Episode 4 – First Profit Multiplier Leads or Sessions

Treehouse Metrics Podcast

In your Amazon business, the first multiplier of your business is Sessions – the number of unique people that visit your product listings.

As an Amazon business owner, you are striving to continually increase the number of people who visit your product listings. The great thing about Amazon is that there is no shortage of people – there is masses of traffic – the trick is getting more people to see your offerings.

We can increase sessions by:

• Keyword and listing optimisation – to get seen for more search terms and ranking higher for those search terms.
• Adding more products. If you have one product, two products might double your sessions.
• Advertising through Sponsored Product Ads in Amazon.
• Sending traffic to Amazon through Google Ads, Facebook Ads, Facebook groups, Youtube & your own email list and website.

Transcript

Welcome to Episode 4 of the Treehouse metrics podcast

My name is Arnie Shields and I am your host, bringing you the skills and knowledge to work ON your Amazon business rather than IN your Amazon business.

In the last episode, i introduced the 5 multipliers of business and how just small increases in each of those multipliers can deliver you exponential growth

In this episode, I am going to discuss the first multiplier – leads or for Amazon businesses -Sessions

The First Profit Multiplier – Sessions

You cannot get a sale until someone visits your listing.

If sales are falling it is either due to sessions falling (less people visiting your page)

or conversions (unit session Percentage) falling

or both. By the way – if sessions and conversions are falling then have massive drop in sales.

To find the underlying reason why sales are falling, you need to look at both because it will highlight the problem that needs to be fixed.

Sessions falling means that:

• your listing is not showing up on search results which points to keywords and listing optimisation, or
• your listing is ranking well, but people are not clicking on your listing which points to Price, Images, Titles & Reviews.

Sessions is the primary measure of leads for Amazon sellers.

you could use Page Views but Conversion Rate data from Amazon is on basis of Unit Session Percentage at ASIN level or Unit Session Percentage or Order Session Percentage in overall Account View.

So if using PageViews, you end up with a mismatch between the measure of the first and second multipliers as reported by Amazon.

PageViews represent each time a person views the page and A session represents the period that a person is active on Amazon before exiting. So a person may visit you page multiple times in a session before making a buying decision.

Sessions is not reported via API, so services that report Amazon sales & profitability via API will be not able to report Sessions data. It is only available through Seller Central Business reports.

Remember we discussed that your business does not need to get a massive one thing but actually just small consistent increases to acheive exponential growth – 1% increases each month rather than the big 10% increase. In the case of sessions – it culd be 10 1% increases

Having said that we are looking at 1% increases, sessions is one area that we can get big increases easily and cheaply.

What we want to make sure is that those leads actually convert but more on that later.

The First Multiplier being Leads or Sessions also links to the 4th multiplier being Gross Profit because we need to consider the cost of acquisition of the sessions.

We include the cost of acquition of leads as part of the gross profit

The first Cost of Acquistion that applies to all your Amazon sales is the 15% Amazon commission – this is the fee that Amazon charge for access to their traffic.

The good thing about the Amazon Commission is that it is only charged on when you make a sale (no lost traffic that you pay for but doesn’t convert)

and you pay for the traffic at the same time that you get paid so there is no cashflow cost (no paying for traffic that takes weeks or months to convert to a sale).

Other Costs of Acquistion will include advertising – sponsored products, google ads, facebook ads etc but will also include the costs of your marketing department – like content creation, website, videos, hosting costs, VA’s.

Thus we have to be aware that increasing the first multiplier sessions might have a cost in decreasing the 4th multiplier, you you could move on multiplier up but the other down.

So lets look at the different ways that we can increase the number of sessions in your Amazon business.

Firstly, we will look at ones that have little or no cost that you can implement.

You always need to innovating in your business, it’s how you get to continually increase your business rather than one step forward and one back or just all backwards.

You know want will happen to you business if you just do the same as last month.

Innovation is not just new products or a better product – it is innovation across every part of your business – marketing, sales, production, admin, systems – a process of continual improvement.

So we want to increase our sessions – the number of people that are visiting your product pages.

Keyword & Listing Optimisation

A simple way to increase your sessions – Getting extra traffic from a new search term

Implement a regular process of examining your back end keywords, titles and bullet points to find more searches that your products are relevant too.

Establish a system – write down the process that you use to optimise your listing and keywords and diarise it in your calendar to address each month.

Remember this new search term might not be a massive search term but does it result in a 1% increase.

Your relevant search terms will change over time – seasonality or auto suggest from Amazon and your rankings for search terms over time will change as well.

You might be focusing on a niche of main search term in the beginning but you might start to rank for major search terms that means it might be time to re-focus your titles, keywords and bullet points.

Keeping track of those keywords might require a low budget auto campaign with the main purpose being to track possible keywords.

Better Rankings & Best Seller Badges

Getting better organic rankings for your search terms – in my opinion – rankings is linked to your conversion rate – products that have a higher conversion rate for a particular search term will rank higher.

More Products

One of the easiest ways to increase the number of sessions in Amazon is to launch new products. This will have of course a cashflow effect – being buying new product and the costs of launching the new product plus it will also have risk .

If you have one product with say with 10,000 sessions per month, a new product with even 1,000 sessions per month will be a 10% increase.

Continual innovation and launching new products is essential because the life cycle of products in Amazon is so short. If you have a best seller, competition will arrive and drive down your profits.

The caveat of continually launching new products is that the complexity of your business will increase – you will need to spend more time and money on measurement – accounting systems, inventory control systems.

We see that as businesses grow and their complexity increases, the likeihood that something is missed due to so many other things going on in the business. As the complexity of your business grows, it becomes imperative that you have measurement and systems in place to ensure that you are not taking one step forward and one back.

Sponsored Products

Buying traffic through sponsored products. This of course has a cost decreasing the fourth multiplier – gross profit.

With sponsored Ads , again it is continual improvement – small increases continually applied – more search ters, removing unprofitable search terms, lowering cost of acquisition and increasing reach.

Other Paid Advertising & Traffic Sources

Of course you can increase sessions by directing traffic from outside sources like Google Ads, Facebook Ads, Mailing lists, Blog Content.

Whilst Google Ads and Facebooks Ads may have a direct effect of sales in that the cost of advertising is incurred at the same time as the sale, building email lists and blog content will take time so there is a cashflow delay between the time that costs incurred and a sale results.

Anything that involves time there is risk so you need to consider the risk in your decision making.

With sponsored ads and paid advertising you can get a pretty quick validation of whether the ads are working and at a profitable price.

Email lists and Blog content can take a months to build up.

Look for easy wins first – keyword & listing optimisation. If sales are falling or increasing, examine you Seller Central data to find out whether it is a sessions issue – Price, Rankings, Image, Titles or a conversion rate issue.

It is about continual improvement looking for many small wins continually applied.

A 1% improvement is a win – look to where it is leading you. Might get 10 1% wins – Improve keywords, rank for more search terms, get better organic rankings, buy traffic. Next month the same thing.

Now the multipliers apply to every business and as an Amazon seller you will most probably have your own eCommerce site so how do we measure the first multipler – leads in other types of businesses.

We need to find a measure of leads that is applicable to the conversion multiplier.

So some basic rules in determining what your measure of leads is:

1. Identifiable make decision intent to buy – total visitors to your site including the blog or just to product pages
2. You define what leads are but it should be easy to measure and have a common definition.
3. If define leads to high up the sales funnel then may focus on wrong area
4. Can add another level of measurement being visitors to your site and visitors to product pages and number of people who go to checkout page
5. Series of micro yeses leading to the big yes being the sale.

Depending on your business, a lead should also be measured by someone that you can continue to contact – name and address. A prospect could be an anomyous person but a lead is someone who has shown interest – subscribed to mailing list where you can staart to work them through your sales funnel.

A common problem with many businesses is that they don’t have enough leads and a system for consistently generating more leads.

1. Primary problem – not enough leads
   1. Effect:
      1. Have to convert every lead
         1. Reduce prices
            1. Effect average sale value multiplier
         2. Poor negotiating stance
         3. Take clients don’t like
         4. Provide terms of payment
         5. Customise work when should be systemising
         6. Affects thinking in respect of forms of lead generation
            1. Too expensive
            2. No converting enough
            3. Because don’t utilitise lead generation, don’t split test different method to optimise
            4. No sales funnel
         7. Pressure on business
         8. Halts entire business in its ability to grow
      2. Cannot optimise conversion methods
         1. No systems
         2. Reactive rather than proactive
2. What happens when you have an abundance of leads
   1. No pressure convert every lesd
   2. Increase prices
   3. Test conversion
   4. Test and optimise channels
   5. Systemise service offerings
   6. Start asking for payment Upfront or reducing payment terms
   7. More sales
   8. Rest of the system starts working

1. Start: Where are leads coming from
   1. Where is greatest leads
   2. Is that where you spend time resources, money, manpower
   3. What source of leads is converting to sales
   4. Look through customer list
   5. Where did you get your most valuable ideal customers
   6. Cost of those leads in terms of time and money
   7. What is working now before chase latest new idea

Conclusion

In your Amazon business, the first multiplier of your business is Sessions – the number of unique people that visit your product listings.

As an Amazon business owner, you are striving to continually increase the number of people who visit your product listings. The great thing about Amazon is that there is no shortage of people – there is masses of traffic – the trick is getting more people to see your offerings.

We can increase sessions by:

• Keyword and listing optimisation – to get seen for more search terms and ranking higher for those search terms.
• Adding more products. If you have one product, two products might double your sessions.
• Advertising through Sponsored Product Ads in Amazon.
• Sending traffic to Amazon through Google Ads, Facebook Ads, Facebook groups, Youtube & your own email list and website.

In the next episode, we will look at the 2nd Multiplier being Conversions and you can increase your conversions on Amazon and when combined with the first profit multiplier achieve exponential growth.

Until next week. Happy Selling.