How to 2x your Amazon sales
Summary
TLDRThis video script delves into strategies for Amazon sellers to boost sales, discussing the balance between higher sales volumes and conversion rates. It emphasizes the importance of understanding the sales funnel, identifying controllable factors, and optimizing 'choke points' such as click-through rate, conversion rate, sale price, and average units per order. The script suggests using data and ad insights to enhance the funnel, cautioning against merely increasing ad spend without strategic adjustments. It concludes by highlighting the potential for significant sales increases through small, strategic optimizations, offering a spreadsheet tool for sellers to model different scenarios.
Takeaways
- π Amazon sellers aim to increase sales, but understanding the factors they can and cannot control is crucial for optimizing the sales funnel.
- π The sales funnel is influenced by various touchpoints and interactions that shoppers have with a product, which can be difficult to understand and optimize.
- π‘ Higher sales or conversion rates are often debated, but the ultimate goal is sales. However, conversion rates do affect sales, creating a 'chicken or the egg' situation.
- π The script suggests that increasing sales can be achieved even with a lower conversion rate by understanding the sales equation and optimizing the funnel.
- π Impressions or views are the top of the sales funnel and can be influenced by ads, search queries, and other visibility tactics.
- π Click-Through Rate (CTR) is a key choke point that can be optimized by improving product images, reviews, pricing, and promotional offers that shoppers see.
- ποΈ Conversion Rate Optimization is vital as it determines how many detail page views result in orders. It involves listing content, product appeal, and market positioning.
- π° The sale price and average units per order are other choke points that influence total sales revenue and can be optimized for profitability.
- π Using ad data can provide insights into 'choke points' in the funnel, which can help in understanding where to make improvements.
- π After optimizing the funnel, increasing impressions through ads can exponentially boost sales without necessarily changing rankings.
- π The provided spreadsheet is a tool for sellers to experiment with different scenarios and understand how tweaks in the funnel can impact sales.
Q & A
What is the main focus of the video script?
-The main focus of the video script is to explain how Amazon sellers can increase their sales by understanding and optimizing the various touchpoints within the sales funnel.
What sparked the discussion in the video script?
-The discussion in the video script was sparked by a post that questioned whether higher sales or higher conversion rates are better for ranking on the Amazon platform.
What is the 'sales funnel' mentioned in the script?
-The 'sales funnel' refers to the process that potential customers go through from the initial awareness of a product to the final decision to purchase it. It includes stages such as impressions, clicks, conversion rates, and sales.
What are the 'choke points' in the sales funnel?
-The 'choke points' in the sales funnel are the areas that can be influenced and optimized by the seller to improve sales, such as click-through rate, conversion rate, sale price, and average units per order.
How can Amazon sellers increase their sales without affecting their ranking?
-Amazon sellers can increase their sales by focusing on optimizing the choke points in their sales funnel, such as improving their click-through rate and conversion rate, without necessarily affecting their ranking.
What is the importance of understanding the sales funnel for Amazon sellers?
-Understanding the sales funnel is important for Amazon sellers as it helps them identify areas of strength and weakness in their sales process, allowing them to make informed decisions on how to improve sales effectively.
What role do ads play in the sales funnel?
-Ads play a significant role in the sales funnel by increasing impressions or views, which is the top of the funnel. They help get the product in front of more potential customers, potentially leading to more clicks and sales.
How can a seller's click-through rate impact their sales?
-A seller's click-through rate impacts their sales by determining how many people who view the product in search results or ads actually click through to the product detail page, which is a prerequisite for making a sale.
What factors can a seller optimize to improve their conversion rate?
-A seller can optimize various factors to improve their conversion rate, including listing content, product images, reviews, price point, and any special offers or discounts that may entice customers to complete a purchase.
How can understanding the competition influence a seller's sales strategy?
-Understanding the competition can help a seller identify market trends, pricing strategies, and promotional tactics that competitors are using. This insight can inform the seller's own strategies to stay competitive and attract customers.
What is the potential downside of increasing the sale price of a product?
-The potential downside of increasing the sale price of a product is that it may decrease the conversion rate if the higher price makes the product less appealing to potential customers compared to similar products in the market.
How can a seller determine the optimal number of units per order?
-A seller can determine the optimal number of units per order by analyzing customer purchasing patterns, market demand, and the suitability of their product for bulk purchases or bundle deals.
What is the purpose of the spreadsheet mentioned in the video script?
-The purpose of the spreadsheet mentioned in the video script is to serve as a tool for sellers to model different scenarios, calculate potential changes in sales based on adjustments to the choke points in their sales funnel, and forecast the impact of these changes on overall sales volume and revenue.
Outlines
π Boosting Amazon Sales: Understanding the Sales Funnel
The script introduces the topic of increasing sales on Amazon, emphasizing the importance of understanding the sales funnel and the factors within a seller's control. It discusses the balance between higher sales and conversion rates, suggesting that while conversion rates affect sales, the ultimate goal is to increase sales volume. The video aims to clarify the sales funnel on Amazon, including the touchpoints shoppers have with products and how to identify and improve 'choke points' within the funnel. The speaker also cautions against simply increasing ad spend without understanding the funnel dynamics.
ποΈ Influencing the Sales Funnel: Choke Points and Strategies
This paragraph delves into the concept of 'choke points' within the sales funnel, which are areas that sellers can influence to improve sales. It explains that while metrics like click-through rate (CTR) and conversion rate are results of other factors, they can be manipulated to increase sales. The script discusses how to increase CTR by optimizing product images, reviews, pricing, and promotional deals. It also touches on the importance of considering the market context and competitor actions when analyzing and adjusting one's sales strategy.
π Optimizing Conversion Rates and Sales Price for Maximum Impact
The focus shifts to the optimization of conversion rates and the sales price to enhance sales volume. It illustrates how an increase in conversion rate can lead to more orders and, consequently, higher sales. The paragraph also addresses the potential trade-off between raising the sales price and maintaining a competitive conversion rate, emphasizing the need for a balanced approach. The importance of understanding the entire shopping funnel and the shopper's perspective is highlighted, along with the suggestion to use ad data to identify areas for improvement.
π Fine-Tuning the Sales Funnel for Profitable Growth
The script concludes by emphasizing the importance of fine-tuning each aspect of the sales funnel for profitable growth. It discusses the impact of increasing the average units per order and suggests strategies like 'subscribe and save' or offering incentives for multiple purchases. The speaker provides a hypothetical scenario using a spreadsheet to demonstrate how small optimizations in the funnel can lead to significant sales increases. The video aims to empower sellers with a clear understanding of the sales funnel and actionable steps to drive sales profitably.
Mindmap
Keywords
π‘Sales funnel
π‘Conversion rate
π‘Impressions
π‘Click-through rate (CTR)
π‘Amazon Seller
π‘Product listing
π‘Price point
π‘Ads (Advertising)
π‘Sponsored products
π‘Competitive analysis
π‘Optimization
Highlights
Amazon sellers aim to increase sales, focusing on controllable factors within the sales funnel.
The video discusses the balance between higher sales and higher conversion rates, emphasizing the ultimate goal of sales.
Understanding the sales funnel is key to identifying points of influence and areas for optimization.
The video explores the concept of 'choke points' in the sales funnel that can be influenced to improve sales.
Ads can increase impressions and views, but other factors in the sales funnel also play a crucial role.
Click-through rate (CTR) is a significant choke point that can be optimized through various listing elements.
Reviews, price points, and deals are highlighted as important factors affecting CTR and ultimately sales.
The importance of considering the entire shopper experience and market context when optimizing listings is discussed.
Competitive pricing strategies are examined for their impact on a product's attractiveness and sales.
Conversion rate optimization is identified as a critical aspect of the sales funnel, influencing the number of orders.
Listing content, including images, title, and reviews, is emphasized as essential for improving conversion rates.
The video demonstrates how small increases in conversion rates can significantly impact sales volume.
Sales price and average units per order are identified as factors that determine the total sales revenue.
The potential negative effects of increasing sale price on conversion rates and overall sales are discussed.
Strategies for increasing the average units per order are suggested as a way to boost sales volume.
The video concludes with a practical example of how optimizing various choke points can lead to increased sales.
A spreadsheet tool is introduced to help sellers forecast and optimize their sales funnel for maximum impact.
Transcripts
all Amazon sellers want to make more
sales let's be honest but how do you
actually increase the amount of sales
what things do you have control over
what things do you not have control over
and how can you understand the sales
funnel and how to improve it this is
what we're going to be going over in
today's video
all right so this topic or this idea was
actually sparked by this particular post
I'm not hating on this post I think it's
really thought provoking so the question
was like what's better higher sales or
higher conversion rates like what helps
you rank better or what's better for you
on the platform now my kind of like
contrarian View and comment uh here was
like if I'm making more sales why should
I care about ranking because sales is
the ultimate goal but then it got me
thinking because this higher sales or
higher conversion rate is kind of a
chicken or the egg thing right we all
know that conversion rates affects sales
so how is it possible to get higher
sales even if you have a lower
conversion rate like what's the equation
here and so what I wanted to explain
today and help sellers really understand
is this whole sales funnel when it comes
to Amazon because there's certain touch
points so there's certain interactions
that Shoppers have and then sometimes
something on one end of the funnel it
feels like it's hard to influence for
instance everyone wants to say I want to
have increases in sales right that's why
we started this concession that's why
you're still watching but how you can
influence sales what parts of the funnel
should I tweak where am I doing well
where am I not doing well oftentimes
it's really difficult to understand so a
lot of sellers will backtrack into
ranking or they'll say hey I need to run
more aggressive ads which may be the
answer but it honestly may not be the
answer and what I want to sort of
caution against is this sort of ultimate
throw more dollars at this problem
because that's how we're going to fix it
now ad dollars definitely are going to
help with this problem and I'm going to
show you how and also how you might use
ad data to sort of get information on
some of the sort of what I'm going to
call Choke points in the funnel but that
being said I think it's really helpful
if we sort of walk through this funnel
because there's sometimes where if your
funnel is working all all you should be
doing is throwing more people into the
top of it getting in front of more
eyeballs and that's definitely something
that you can use ads to increase but the
entire rest of this funnel is something
that is not influenced by ads yet has a
very heavy influence as to how many
sales you actually get at the end of the
day which in reality when we're talking
about growing Amazon businesses that's
all we really care about can I drive
more sales now can I drive more sales
profitably that's another conversation
at the end of the day all we're looking
to do is drive more sales now can I
drive more sales profitably that's kind
of a different conversation right now
we're just going to be talking about the
sales funnel the choke points and how we
can drive more sales through data okay
what we're going to do is we're going to
start at the top and I'm going to show
you product a and product B and if you
would like access to the spreadsheet to
just kind of play around because this
spreadsheet can actually be used as sort
of a Ford costing tool if that's how you
want to use it but what I I want to do
is kind of walk through the different
choke points in the funnel and then show
you how the top of the funnel as we go
down it sort of influences what happens
on this sales level so you can optimize
any part of this funnel and it's going
to influence what happens in sales that
being said let's just go chronologically
here so the first thing we're going to
start off with is Impressions or views
now when you think Impressions you
definitely are thinking ads and running
more ads and getting more Impressions
and it's definitely something that is
important however I also want you to
think this as used in the search grid
now there are some ways that you can
sort of get an understanding of this
from a total account standpoint using
the search query performance however a
search query only includes views that
you get in the search grid it doesn't
include widgets it doesn't include
places that you show up on product pages
it's not going to include like off-site
traffic or if you're running sponsored
display ads and showing up off-site it's
not going to include anything except
just a search that's why a lot of people
get kind of confused because they say I
thought there was more search volume for
this particular search term yes that
would be the case but again search query
performance only includes the views that
happen inside the regular typical search
grids here but again think of this as
the top of the funnel think of this as
everyone kind of flowing in these are
people who kind of run across your
product in their day-to-day Amazon
shopping searches right you could show
up in the search grid you could show up
at a product page maybe you're running
sponsor display ads and you kind of show
up on the home page somewhere maybe
you're showing up again sponsor display
ads can also run offsite you might be
running DSP ads these are all kind of
like the views people running across the
products right and then what I want to
do is kind of go through these so
anything that are these are in blue
these are what I'm calling your choke
points or basically the things that you
can influence and the reason why I think
this sounds somewhat or is somewhat
confusing to sellers is a lot of times
people say Okay I want my more traffic
meaning I want more clicks on my product
right I want to drive more orders I want
to drive more sales these are sort of
what's often referred to as like lagging
measures or end results of other things
happening on behind the scenes but the
thing is that the things that are
happening behind the scenes again these
blue ones so your click-through rate
conversion rate what your sale price is
and the average units per order
oftentimes those things are calculated
using these other metrics so for
instance our click-through rate we
calculate this as our clicks divided by
our impression so everyone who's seen
the product what percentage of those are
actually clicking onto the detail page
so sometimes it can seem like your
click-through rate is an end result of
your clicks and your impressions but
that's not actually the case your
click-through rate is what drives or is
determining the amount of people who are
clicking through once they see your
product and as you can imagine
click-through rate is more easily
understood as to how you can influence
it so for instance if I said oh I want
to drive more clicks you know people
might think oh increase my bid get more
Impressions which is true you could
increase the amount of people seeing
your product but really when it comes
down to it the way that you get more
clicks is by having more people who are
viewing the product pop themselves in
for a click and the things that you can
optimize here would be things that the
Shopper is going to see when they run
across your product so think of your
Shopper interactions right you they see
your main images they see your reviews
so your reviews are so important they
see your price point they also might see
coupons or deals that you have in your
product most places in the search grid
or also in the advertising showcase
deals and coupons so that can be another
way to improve your click through rate
which is I want to entice more people
onto my page also think about it as in
what is the total view of the Shoppers
oftentimes what we do is we narrow
ourselves in and say like oh my image my
price point my reviews and we failed to
take a look at the entire Shopper
experience meaning what are my
competitors doing what is the context in
which I am showing up this can be really
insightful when maybe all of a sudden
you see a drop you might also see it in
the conversions as well but definitely
in your click-through rates when you're
all of a sudden your competitors
everyone's running coupons and you
haven't kept up the market and you're
not running coupons all of a sudden all
of those other products became way more
enticing to Shoppers and you'll notice
your click-through rates may be
declining or maybe other sellers their
click-through rates are increasing and
so relative to the market you've had a
decrease and so that might be something
for you to optimize so don't only take a
look at your product in isolation you
want to take a look at your product
relative to the market unfortunately I
know we're stuck between a rock and a
hard place a lot of times when it comes
to profitability and if our competitors
are significantly dropping their prices
it definitely becomes a major pain point
so I thoroughly sympathize with us that
being said when it comes to Shoppers
they're not really concerned about your
profit margins let's be honest they're
concerned about can I get a deal so if
all of a sudden all of your competitors
have decreased their prices well maybe
your product is no longer as appealing
as it used to be and I see a lot of
sellers with a lot of spreadsheets and
say okay my margins are this and my so
my price point must be this I completely
get it and I completely understand
because at the end of the day yes we
don't really need seals we need to have
net profits available to continuously
run our businesses but that being said
we can't take our eyes off of what the
competition is doing and how our
products are positioned in the market
and how interested Shoppers are in our
particular products and that's what our
click-through rate is going to tell us
now click-through rates aren't super
visible in the organic searches you
definitely can see click-through rates a
little bit more intently when you look
into the ads so oftentimes ads a really
good place to start when you're trying
to get an idea of what your
click-through rate looks like that being
said you can use a search query report
to do some calculations and identify
kind of click-through rates on
individual search queries which you
might find helpful as well okay so that
was a huge bill on click through rates
which again how many people are viewing
what does our click-through rate look
like we'll determine the amount of
clicks so I could take this and I can
include so I would have to double my
click rates but I would go from a 0.5
click-through rate to a one percent
click-through rate and you can see how
my clicks essentially doubled because it
doubled my click-through rate I doubled
my clicks notice what happens downwind
of this right all I did was double my
click-through rate I didn't mess with my
conversion rates I didn't change my
price point I didn't even change how
many units are being sold but what I
essentially did is they doubled my sales
so you can see how that looking at the
entire shopoff funnel and ultimately
being able to optimize this entire sales
funnel will help us exponentially
increase our sales okay so now we get to
clicks right people opted themselves in
they're on the detail page now we have
this additional choke point which again
is something that we can opt back so so
how many people are viewing the detail
page our conversion rate is going to
determine how many of these people are
actually going to result in an order so
in this case we can see both of these
products have a conversion rate of 10
but also again because I'm getting twice
as many clicks on product a you can see
how that results in two orders so let's
simply put this back let's say Apples to
Apples we want to make everything even
this is going to be a 0.5 click through
it and you can see that at a 10
conversion rate with 10 people clicking
in both of these are resulting in one
order and again this is a choke point
this is something that we need to
optimize that's why a lot of people talk
about conversion rate conversion rate
optimization is important so of course
how you could optimize your conversion
rate is definitely going to be all of
your listing content so where are What
are Shoppers interacting with what were
they searching for how appealing is your
product again they're also analyzing
price point Main image but now we have
them analyzing all of your images maybe
your title which might play into click
your click-through rate as well a plus
content ultimately reviews trying to go
through but then again how appealing is
your product versus your entire Market
also is in play here due to all of the
other uh products that can show up on a
detail page as well um there are
defensive strategies you can run with
ads But ultimately again how much does
your product deliver on the promise of
your main image and what it is that the
Shopper was searching for ultimately
that is going to determine how many
people then opt themselves into an order
so in this case say we improved our
conversion rate by 15 on product a again
everything remains equal we can make a
point five percent increase in our the
number of orders so this definitely will
improve things for us and again you can
see how that increases the sales volume
at the end of the day so let's change
this back to 10 again all things
remaining equal and then we'll go down
the funnel as well okay so here is where
we get to ultimately how much we are
going to make after somebody opts in for
an order oftentimes people will look at
sales volume and they might look at
units sold but really these things
determine how much money was made at the
end of the day one of them is our sale
price right so if we can increase our
sales price providing it's not going to
decrease our click-through rate or
decrease our conversion rate which can
happen there are other things in the
bottom of the funnel mainly price point
that can kind of influence what happens
at the top of the funnel meaning like
how appealing your product price point
is to the market uh that being said
we're just assuming that the product
that you know the market is okay with
taking a five dollar increase here that
is going to result in an increase in our
sales right we're going to making five
more dollars after we drive sales now
there are some sellers who will look at
their price point and say like oh I
really you know if I could just increase
this to thirty dollars and all of a
sudden I'm going to be making you know
10 more dollars for every single sale
wouldn't that be lovely unfortunately
only sometimes what that does is this
decreases the amount of our conversion
rate so as you can notice what if we
went from a 10 to a six because we
increased our sale price we're actually
making less dollars at the end of the
day so you do need to be very cognizant
of the potential downwinds of doing
things like that but all things
remaining equal of course influence
during our sale price is going to
increase the amount of money we get at
the end of the day but the other thing
that is not as talked about is how many
units are people purchasing when they
opt in for a particular order so for
instance say we had both of these
products at well two hundred dollars
would be a lot more say we had a 20
price point for both of these products
but what if for every other person that
purchased on product a we got an
additional sale that actually is also
going to influence our amount of sales
that we're going to create because for
every other person they purchase two so
there are ways you can do this with like
subscribe and save sometimes on
variations you can also like have them
move up funnel to purchase the higher
price product where you can create
incentives for people to purchase
multiple products doesn't always work
out like that but there are certain
times where you can increase the average
units per order if this is something you
can optimize again it's a little bit
more difficult to optimize but if they
say something that you can optimize your
product Blends itself well to that then
you can also increase your amount of
sales here so let's go back through and
let's see what happens when we go
through and we optimize okay so let's do
a very tiny increase let's see what this
is going to look like and again you can
use this particular spreadsheet to
create sort of maybe you want to do
product a or scenario a and scenario B
and just kind of see like plug in your
numbers as to like how many Impressions
you're getting and then just kind of
tweak these conversion rates and sale
price numbers and you can actually see
like oh what if I increase my sales
price by this what would that look like
or if I increase my sales price but my
conversion rate dropped a little bit but
what does that actually end a result
mean and you might be able to play with
a couple different scenarios and then
work towards again optimizing one of
these choke points but I digress let's
say that both of these products are
getting 2 000 views right but say on
product a we optimized our main image a
little bit I'm going to give it a very
small bump I'm not even going to go
crazy here I'm going to say we want from
a 0.5 to an 0.8 percent uh click-through
rate that's actually going to result in
six more clicks which is quite
significant actually if you think about
it which again is going to increase the
amount of sales that we're making
relatively significantly and so say we
did this optimization that's super great
well maybe we added a small coupon or
other discount or something that did
bump our conversion rate a little bit
again I'm not going to go crazy here I'm
going to say hey we bumped our
conversion rate from a 10 to a 13 or
maybe yeah let's do 13 as you can see
this actually because we're getting more
clicks and we have an increased circuit
conversion rate our order volume has
increased significantly without as you
can see has significantly increased the
amount of sales volume that we're
getting well what if we also because we
have an increase in the conversion rate
and we've definitely gotten like
Optimizer listing it's looking Super
Fresh and we're noticing our conversion
rates increasing we're saying I wonder
if the market can take a little bit of a
price increase right we're not going to
go crazy here let's just add maybe we'll
add two dollars I think the market can
support two dollars again we see a
significant increase in our sales volume
providing again that our conversion rate
doesn't fall or we don't have issues
with the market maybe we have this and
then maybe we have like a multiple
purchase coupon where maybe our product
doesn't lend itself very well to
increases but maybe let's say for every
couple purchases we make another you
know somebody orders an additional unit
let's go like point three here again
nothing super crazy
but we did influence a little bit
you can see all of a sudden and
resulting so all we had was same 2 000
people are viewing our listing same 2000
people are running across it so we're
probably running the same ads we're
probably showing up on the same places
we probably haven't even increased our
rankings at all because again same
amount of people are viewing and all
we've done is optimize our choke points
not even very significantly but a little
bit and all of a sudden for those same 2
000 Impressions or 2 000 views all of a
sudden we went from making twenty
dollars to fifty nine dollars and change
with a little bit of tweaks now am I
saying that these little bit of tweaks
are easy no it takes some work and it
takes some understanding and it takes
some empathy for your target market but
providing you can do that you can
significantly increase your amount of
sales that you're getting so again this
is how the whole funnel works together
and then once you have an optimized
funnel and you are you know you're
really honed in and again you can
increase your views and Impressions with
ads so what if we took this funnel and
it wouldn't be too difficult to get an
extra thousand Impressions but again
let's not go crazy let's say hey let's
just get an extra 500 impressions in
this funnel we're going to increase our
ads all of a sudden this funnel
completely blows up because we have
significantly optimized again we're only
sending 500 more people through this
funnel we haven't even doubled it we
haven't even tripled it which again is
doable uh with ads given your target
market and given your profit margins and
what you can afford in ad spend but we
are in a very good position to put our
foot on the gas because our entitled
funnel has been optimized so I really
hope that you found this helpful I
really hope that helped kind of open
your eyes to the different interactions
and how things works and also the choke
points and steps that you can actually
optimize when it comes to your selling
your product on Amazon to really help
influence that sales increase because
oftentimes they'll be like this I need
more sales black box and it feels like
what are the action steps what are the
points what are the things that I can
help to influence what are the moves I
can make to really help me increase my
sales so if you would like a copy of
this spreadsheet there will be a link to
a form down below plug in your email
address we'll send it to you right away
you can get this you can start playing
with it and again you also feel free to
use this as sort of a forward casting
tool that you could then sort of say if
I increased my click-through rates if I
increase my conversion rates if I played
wrong with my sale price what does that
ultimately translate to when it comes to
things sales
[Music]
thank you
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