Customer Equity Accelerator Podcast

Ep. 84 | Amazon - Customer-Centric Sales Channel

 

"Advertisers on Amazon can target shoppers based on what we’ve researched, looked at and bought, or not. This rich audience targeting is not available elsewhere and you don’t have to be selling on Amazon to use it." - Kiri Masters

 

This week Kiri Masters, founder of Bobsled Marketing joins Allison Hartsoe in the Accelerator to discuss ways Amazon can be used as a more customer-centric retail strategy.  Amazon’s sales volume is highly attractive but how does the lack of customer data affect a retailer’s ability to grow? Are there strategies that can be employed to make use of this platform in a customer-centric way? There are, and Kiri Masters knows them. Hear her valuable Amazon insights on this week’s episode.

Please help us spread the word about building your business’ customer equity through effective customer analytics. Rate and review the podcast on Apple Podcast, Stitcher, Google Play, Alexa’s TuneIn, iHeartRadio or Spotify. And do tell us what you think by writing Allison at info@ambitiondata.com or ambitiondata.com. Thanks for listening! Tell a friend! See the full transcriptView all episodes.

 

Links:

Kiri Masters' Book - Amazon for CMOs

The Marketplace Institute
Kiri Masters LinkedIn Profile 

 

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Show Transcript

Allison Hartsoe: 00:01 This is the Customer Equity Accelerator. If you are a marketing executive who wants to deliver bottom-line impact by identifying and connecting with revenue generating customers, then this is the show for you. I'm your host, Allison Hartsoe, CEO of Ambition Data. Each week I bring you the leaders behind the customer-centric revolution who share their expert advice. Are you ready to accelerate? Then let's go! Welcome everyone. Today's show is about Amazon as a customer-centric sales channel, and to help me discuss this topic is Kiri Masters. Kiri is the founder and CEO of Bobsled Marketing, a digital agency that helps establish consumer brands grow their Amazon sales channel. Kiri, welcome to the show.

Kiri Masters: 00:52 Hi Allison. Thank you so much for having me. It's great to be here,

Allison Hartsoe: 00:56 Amazon as a sales channel is one of those things that I think we never get a degree in that topic. So how did you come about this particular niche? How did you arrive here?

Kiri Masters: 01:06 Yeah, well that's a great point. I guess with all things e-commerce, there's not any worthwhile degree getting because the minute you learn something, it's old news within six weeks and there's no place that's more true than Amazon. I started out my career in banking. I was most recently at JP Morgan Chase, and I started an eCommerce business on the side just for fun, and it was through that little side hustle that I became acquainted with Amazon and realized this is hard. And then I talked with my clients at the bank who are branded manufacturers much, much, much larger than my little company. And they were like, yeah, we can't figure it out either. Maybe you can help us. That's how Bobsled marketing was born, was as a consultancy to help branded manufacturers to navigate their Amazon sales channel and that was back in 2015 that I started out as a solo consultant, and today we're a team of 25 Amazon experts across advertising operations, brand protection and organic marketing. So if there is a lot to it, I can't proclaim to know everything. There are people on my team that know vastly more about very specific and important areas of Amazon. It really is a team effort

Allison Hartsoe: 02:19 And it sounds like a fairly complicated channel. And just the areas that you cited can you go through those again for the specific topics that your team covers?

Kiri Masters: 02:27 Yeah, so we'll start with what I like to refer it to as an iceberg. So everyone says that there's only 10 or 20% of the iceberg visible above the surface. And the stuff that's visible to us as consumers is product content, product information, so that all of the content on the page, when you look at it, maybe some advertising, maybe some promotions that you see, all the stuff that's visible on Amazon either falls into organic marketing, which is SEO content. Amazon's rolling out different types of content all the time. So now they have videos and spin images, and they're starting to do even video advertising now as well. And then the advertising areas as whole Facebook and Google of the oligopoly of the digital advertising market right now. But Amazon is really starting to give them a run for their money, not just with CPG brands, but in a broader sense.

Kiri Masters: 03:19 And we're going to talk about that a little later on, but then below the iceberg, below the surface of the water with the iceberg, this oldest operational and brand protection processes that need to be taken care of in order for your products to even just show up on Amazon. So that includes making sure that you have inventory available on Amazon because then your products don't even going to show up in search results or in advertising if you don't have products in stock or if you have areas that prevent them from showing up or if Amazon does some machine run audit of products listings, and they decide, hey, that face mask that you're selling is a hazardous material, and so we're just going to suspend it and then you have to prove to us that it's not a hazardous material. Like all these kind of crazy stuff happens on Amazon that can cause your products to not show up in search or in ads that need to be reviewed in the background either with an internal team or outsourcing to an agency or however you decide to run that part of your business.

Allison Hartsoe: 04:16 That reminds me very much of my eBay days where the sellers are putting so much into the platform, but unlike a storefront, a physical storefront, you've got a shopping mall that can be closed on you when you don't even realize that all of a sudden where did everybody go? And I think it's very challenging for sellers who sell on a platform to constantly stay up with whatever the platform wants as well as what their customer wants and what they're trying to do with the business. Right? And so this is where I get into Amazon as a customer-centric sales channel because Amazon clearly in their mission statement they say they want to be the most customer-centric company in the world. I get that. On the other hand, we have all these retailers who are using Amazon as a sales channel, but I think they would be hard-pressed to call it customer-centric because of the way Amazon operates. Is it actually a contradiction in terms to think of Amazon as a customer-centric sales channel for retailers?

Kiri Masters: 05:11 Yeah, I think it is fairly contradictory because as consumers, and I'm sure everyone listening to your show has bought stuff on Amazon at least once. It's a great experience that will replace anything that you buy that didn't work. They'll refund you. They have one-day shipping now in most markets in the US. They have very responsive customer service. It is a great shopping experience for a consumer. And so I think when they say we want to be Earth's most customer-centric company, I think that they have met and set a very high bar for that. So I think that delivering on that side, but if you want to be the most customer-centric company, something has to give. And in my opinion, the policy that gives the most is the suppliers to Amazon brands that sell their either on a wholesale basis or on a retail basis because they are then required to meet all of Amazon's very strict operations and brand requirements.

Kiri Masters: 06:10 And then the other piece, which I think that we're going to talk about in a bit more detail, is that there is not a whole lot of data provided to these brands who sell on Amazon, which they might get well that absolutely do get through their own e-com channel. And I think that there are two challenging areas for brands selling on Amazon. One is all of the requirements that Amazon has very strict. There's a lot of rules. The rules change all the time. There's a lot of programs, programs come and go all the time. And then there's the database. And the frustrating thing to so many brands and vendors and merchants selling on Amazon is that we know that Amazon has this incredible wealth of data, but they don't really share a whole lot of it with us.

Allison Hartsoe: 06:50 And I think that's exactly the rub that you hit on. And here's what gets me as we had mark Mahaney from RBC capital on the show a while ago, and he was talking about the quality of Amazon's prime customer base and some analysis that they had done. And so what I thought was compelling about what he said, particularly for retailers is here is this great group of customers that you can sell to that are high quality, and they buy again and again and but they buy from Amazon, and their relationship is with Amazon. So as a seller, yeah, who wouldn't want good customers, but yet this inability to get the data is very challenging. So, on the one hand, you're getting good sales. On the other hand, you have no idea, or maybe you have some idea, but not much of what's coming through. Can you talk more about the data that you can get and what's allowed and what's not allowed, particularly for people who might not be familiar?

Kiri Masters: 07:44 Yeah, absolutely. So Amazon knows so much about us as consumers. They know all about my household. They know that I have a cat, they know that I have a toddler, they know what I've been researching, which to be honest, is probably pretty puzzling because of all the different things that I'm tracking on Amazon. So I'm not sure how much of an idea they really have, but I've seen, I've been targeted with ads for baby products and things where it's, I know that I've been specifically targeted because they have this idea of who I am. So they know what we're buying, what we've researched, what we looked at but didn't buy and a lot of inferences that they can make about out a demographics as well. So some of that information we need to separate out sort of by platform or by program, what Amazon makes available.

Kiri Masters: 08:32 So as an advertiser, using their demand-side platform and with DSP, advertisers can target shoppers down to that level of detail down to the demographic level. Like I want to target women aged 25 to 35 because I'm a beauty brand and I want them to be in this sort of household income range, things like that. That so fairly basic table stakes stuff that's available across any digital advertising platform. But Amazon takes it a step further because they know what we have research and products that we've looked at and products that we bought before and how long ago we bought them and maybe we need to replenish them. So that type of information is available to advertisers who run display ads through Amazon's DSP. So this is your previous guest's point is this is the rich kind of audience targeting that you can only do on Amazon.

Kiri Masters: 09:27 You can't target people on Facebook based on what they've bought in the past because Facebook doesn't know that only Amazon knows what actual research and purchases ran through their platform. So that's one piece of data. And then if we look at, and that advertising platform is open to both endemic brands or brands selling products on Amazon as well as non-endemic brands. Yesterday I was browsing on Amazon, and I saw an Ad for a college saving fund, but can't buy that on Amazon.

Allison Hartsoe: 09:56 At least not yet.

Kiri Masters: 09:57 Yeah, exactly. So that company knows something about these Amazon shoppers that they are often fairly affluent. They know that I have a young child. Right? And that I might be thinking about college savings. So they've been targeting me on Amazon where I visit frequently where they know a lot about me, and they're using that real estate to get in front of me as a consumer.

Allison Hartsoe: 10:20 That's pretty interesting. I actually wasn't aware of that non-endemic brands were really pulling through that way, and that makes sense because of exactly what you said. They know what you're researching and that gives a very strong signature of who you are.

Kiri Masters: 10:32 Yup, exactly. So the other area of data that we can access is for the endemic brands who are selling on Amazon either as a vendor, so on a wholesale basis to Amazon or as a seller, which is as a merchant where you're listing products there. Maybe Amazon is even fulfilling those orders for you, but the sale goes directly back to you as the merchant. And so in this case, what CPG brands or branded manufacturers want here is not just sales information, but they want to know who they sold to. They want to know if there are repeat customers, they want to know just general demographics about those shoppers. And this is where being a supplier to Amazon gets painful because that information is quite hard to extract from Amazon, particularly if you are a vendor. So this is where I don't want to go off on too much of a tangent that may not be super relevant to all of your listeners, but there's two platforms, vendor and seller.

Kiri Masters: 11:23 And what's emerging now is that if you're a vendor selling to Amazon, you generally like a strategic relationship for them that you might have a buyer who you can in theory contact and you get limited data, and they're rolling out a lot more tools and reporting to the marketplace. Merchants who are very numerous and if you're a registered brand on Amazon's platform, they're starting to open up really interesting datasets like how many from all the customers that bought through one of your ad campaigns, how many of those customers were new to brand as in they had never bought from your brand before. So that's a really interesting dataset because Amazon has been quite skimpy in their data sets in the past. It's like, wow, that is, that's pretty revealing. But you can tie it back to their ambitions as a advertiser because that information, for me as a merchant, if I'm looking at that report and saying, wow, from this ad campaign, 40% of those shoppers were new to brands that then it allows me to look at Amazon as an acquisition channel and I might be prepared to pay more for ads because I know, hey, once you buy my face mask, I know that you're gonna be introduced to my brand.

Kiri Masters: 12:34 Hopefully, you like it. Hopefully, you start buying other products from my brand and maybe even stopped buying from me directly rather than just on Amazon. So I think a lot of these initiatives kind of come back to their ambitions as an advertiser.

Allison Hartsoe: 12:46 That makes sense. And I think that the angle is very interesting one where you're getting a little bit more information through the ad campaign than you might have gotten on the regular vendor relationship. Would you call that the regular marketplace relationship?

Kiri Masters: 13:00 Yes. The marketplace is sort of the open platform where you can sign up and start selling pretty quickly.

Allison Hartsoe: 13:06 I liked what you said at the beginning or the end of that about the acquisition channel because I think a lot of sellers think about Amazon as, well I can dance with the devil a little bit and then I'll just pull people over to my site, and yet what I saw from a presentation at e-tail earlier this year was just the opposite and the research was that they were finding brands independently on the internet, perhaps through social channels or other channels, other acquisition channels, and then buying repeatedly on Amazon. Do you think is that true? Is that what you're seeing too?

Kiri Masters: 13:41 Yeah, that's exactly what the research suggests so the best study on the came out from salesforce and publicist sapient and they've just redone this analysis. It be good to get, I'm going to get my hands on this soon, but a year ago they did a study to find out whether consumers would prefer to buy in-store or on a marketplace for a first time purchase and then for a repeat purchase. And they found that the majority of people if they're going to buy a product for the first time, they would prefer to do it in a retail store as opposed to a marketplace like Amazon. But when it came time to repurchase, they would prefer to do it on a marketplace more than a retailer. So this makes sense. Like if I am going to Sephora because I'm looking for a new type of makeup, I want to try some things out. I might want to talk with an associate. I'm going to test out some different products, but by the time I've purchased something, and I've been using it for the last couple of months, I know what I want to buy the next time. I know the brand. I know the shade, I know the formulation. And so I'd rather just like grab that product, type it into Amazon, go and buy it there because I don't want to drive all the way back to Sephora to buy something I already know that I have. Exactly I want.

Allison Hartsoe: 14:51 Yeah, I think that's where the rub is. Right? So for a retailer, it's not really an acquisition channel or is it? Can it be?

Kiri Masters: 14:59 Well that's a good point because this Amazon might say, well this customer is new to the brand, but that only means that they've never bought from your brand on Amazon previously. So yes, maybe they got introduced to the brand in Sephora. Maybe they got a store and ad on Facebook, and this is something that we say quite often as well, is that other marketing channels influence Amazon pretty directly. So we would often have clients who ran a really successful Facebook ad campaign or any type of external marketing PR influences, but especially with paid media on other channels, they'd run a campaign, and if it was successful we would see their-selves on Amazon jump, and they weren't doing anything different on Amazon. But what was happening was a consumer would see an ad on Facebook for a product I think. Huh, that's interesting. I think I want to buy that.

Kiri Masters: 15:50 But instead of clicking-through on that ad and going to the e-comm store, which is where the ads were running to, they would open up a separate tab, find out if it's on Amazon, and then they would buy the product on Amazon rather than taking the quote-unquote risk of buying through a site that they may not have heard of before. The whole concept of buying a product on Amazon is really familiar to most people, so they would prefer to buy it there first. So this is where all of these walled gardens in the advertising world are creating an issue because attribution is really difficult. I don't know if that customer first saw my ad on Facebook and then bought from me on whether they're buying in stores before that. I don't think there's ever going to be a perfect science to matching up all of these different acquisition and purchasing channels.

Allison Hartsoe: 16:35 So it sounds like whether your advertising externally, just as you said, or advertising on Amazon. The bottom line is people still want to buy products on Amazon. I've heard some retailers say, well, we'll just put part of our inventory on Amazon, and we'll put the rest of it on our site so that we can kind of bait people a little bit and have them understand that there's more available somewhere else. Is that a successful strategy and if not, what kind of strategies have you seen that are successful for retailers?

Kiri Masters: 17:07 Yeah, I understand the logic of this because the economics are usually better through your own channel and you're an Ecom side, and you also get a lot more information about the customer that you can use later. So I understand the preference that most brands have to shift customers from the Amazon channel to their own channel. But I think it's a false economy and it can end up frustrating the customer. So in that example, and just as a, you know, to call out an entire category, I think that big beauty brands have been very slow to adopt Amazon, and that can create a very frustrating experience. When I have a makeup product that I want to buy on Amazon, and I searched for it and it's not there or it's being sold by a junky looking third party who's put an iPhone photo up there and I'm like, am I ever going to get that if I order it or does it going to be out of date?

Kiri Masters: 17:56 Then this not only a, there's a branding issue because I'm like, that's a high-end beauty brand that has this junky looking photo, and inaccurate product information or whatever's going on there so to tracks from the brand and then also it frustrates me as a customer because that's where I want to purchase the product, and I don't think that it's worth just save the economic margin that you might get through your own channel or the extra customer data, which you better than anyone probably would see companies collecting all this data or never doing anything with it anyway. Right?

Allison Hartsoe: 18:32 We like to help them do something with it. But I think on Amazon, I imagine, I mean I've heard there are some very strong restrictions. You can't match. Like I might know who I shipped it to, but I can't take that address and match it to other data sources to basically say help me get a comprehensive 360 view of my customer base. Right?

Kiri Masters: 18:51 Yeah. I think that the restriction there is that you can't contact that customer through the information that you have about them. So you can't send out direct mail. You can't, like you said, appropriate targeting groups and target them on Facebook. I mean people do, but it is against their terms of service and again, coming back to the vendor versus merchant discussion that we would just have that information where it's customer level, it's auto level information, or I get to see someone's address and what they ordered. That's certainly available to merchants as well. So that data set in and of itself can be quite interesting because even if you don't compare it to any other data set that you have, you can still get a view of what zip codes are people ordering from. So you might be able to get a view of demographics, you might get a view of repeat purchases. So how many of that group from the last six months have reordered products or bought different products. So you can certainly extrapolate a lot out of that Data set by itself. But I think if you're very careful with that data and you're not using it to try and remarket or contact those customers, then of course, you could look up to say, did someone with that same address order from you through your ecom site in the past and uses that information just internally.

Allison Hartsoe: 20:03 So I recently did a different show with a woman who writes about Alibaba, and I think it's very interesting how Alibaba views their position in the market and how they're kind of slowly coming on to the US market. When I've pulled it up before, basically it's like, do you want to buy 30 flat-screen TV? Is this massive supplier market, but it's not so much that anymore, they've gone down to Singles day, they'd gone down to other ways that they're doing more direct to consumer selling. And the interesting thing that I find in the difference between the two platforms is Alibaba doesn't sell any of their own products unlike Amazon, and they seem to be enabling that seller to customer communication. They have, in fact, many platforms where you can reach out and talk to your customer. Is that an area that you see Amazon shifting or is Amazon's model really about we want to be the satisfactory sole procurement place for you?

Kiri Masters: 21:01 It's such an interesting question, and I would go back to the origins of each company, and I've read a fascinating biography about Jack Ma, the founder of Alibaba about a couple of years ago.

Allison Hartsoe: 21:16 Was it The House that Ma builds or something like that.

Kiri Masters: 21:18 Oh, it was written by his PR guy at the time.

Allison Hartsoe: 21:21 Yeah, I read that too. It was really good.

Kiri Masters: 21:24 It was really good. And knowing quite a lot about the origins of Amazon and the origin story of Jeff Bezos and Amazon. Some of the differences and similarities were really striking, so similar in many ways in their ambition and their ability to capture this market really quickly in their respective markets. But I think the difference is Amazon's always been extremely customer-centric to going back to what we talked about at the beginning and Alibaba has been extremely supplier centric and that's where I think their philosophies diverge significantly and that's why the experience is very different and Alibaba in the US has been primarily like you said, a B to B platform for finding suppliers in China. Typically that's the use case of Alibaba in the US, but like you said, they're getting into more of this B to C kind of situation. What people complain about with Alibaba is the customer experience that they get from the sellers like if you've got a problem with the product or it didn't arrive, or it arrived damaged or something like that, the supplier, because they've got all the control can be like, oh, well too bad I'm not going to talk to you.

Kiri Masters: 22:37 I'm not going to fix your problem, and then that's their prerogative. Whereas with Amazon is the complete opposite extreme. If you're a customer and you've got a tiny little problem, I'm amazed whenever I contact Amazon about an issue with an order or something, I just got a new one shipped out to me right away, and I know who's paying for that. It's not Amazon. It's the brand. Right? So I think that's the difference is the orientation towards sellers or marketplace participants and customers in the case of Amazon,

Allison Hartsoe: 23:07 Well, and we've seen this before, if you think about iPhone versus Google's droid product, it's really the same thing. Do you level set the playing field and really control the experience so that you end up with a very consistent brand satisfactory customer experience? Or do you prioritize those independent app developers that may not all work together if you let it be hog-wild and it's very much the same?

Kiri Masters: 23:30 That's a great analogy. Various too. I think that's right on the money.

Allison Hartsoe: 23:34 Do you think then, I mean we've never really seen Google or apple shift their philosophy, but do you think that we, if Alibaba puts enough pressure on the US market that Amazon could be pressured into taking their customers centric gold and sharing it with more retailers?

Kiri Masters: 23:54 Possibly. And I think the other catalyst for that is just market scrutiny or scrutiny by regulators. And at the time of recording this, there's a lot of, at least a lot of talk about investigating Amazon for some of their practices, which some people view as anti-competitive. So the private label, you know, the private label brands that Amazon has and whether they're giving their own products, preferential treatment in search and stuff like that. So I think that maybe the pressure to open up a little bit and treat suppliers better frankly could come from competition. Maybe Alibaba, maybe Beaumont, maybe Target who recently opened a marketplace as well. But I think that the immediate pressure is probably going to come from a bit more regulatory scrutiny.

Allison Hartsoe: 24:42 I, you know, there's nothing that gets action like regulatory scrutiny. And so if that does come through, what do you think the effect will be?

Kiri Masters: 24:52 Well, a big problem that brands have is with these private labels that Amazon is launching and they have at this point well over 400 private labels and exclusive brands.

Allison Hartsoe: 25:03 Is that right? I didn't realize it was so high.

Kiri Masters: 25:05 Yeah. So with their own private labels where they're sort of the OEM as of just over a hundred, and then the exclusive brands are companies that Amazon's partnered with and basically locked in to say, hey, you can make this skincare product and sell on Amazon, but let's have an exclusive relationship so you can't sell to other retailers or anywhere else. And so then you're going to get a bit more of a marketing bump from us as a result. So if you're a national brand, let's say if you own the brand, Scott, the paper company, toilet paper and industrial, they do a lot of industrial products as well. And Amazon just launched its first-ever B to B paper suppliers, companies. So they're making like bulk boxes of toilet paper and hand towels and wipes and stuff like that for a business or industrial environment. Then that's going to be concerning to you because you've got this player who's, you've got this new brand that came into the market that is isn't really concerned with profitability on that product line, and they are able to give themselves, in theory, all of these preferential placements in such results and with you know, their own advertising products and things like that.

Kiri Masters: 26:13 So if you're that brand, you might feel quite strongly that Amazon shouldn't be allowed to give themselves a preference in search and advertising and stuff like that. So I think that's going to be an interesting one to hash out because it is their platform and retailers have been doing, have been creating private labels since forever using similar data sets and things like that and putting their own private brands in premium spaces on shelves and adding them to this doraculous and all of this stuff has been done before, but Dick has, it's Amazon people seem to feel very strongly about their practices.

Allison Hartsoe: 26:50 I can see where it's been done before, and yet Amazon suddenly seems like it has a slightly different treatment. That makes sense. And so if you're a retailer today, what would you recommend that people think about doing? How should their relationship with Amazon be shaped? And is it different for different categories of product?

Kiri Masters: 27:10 Yeah, so in my book that's coming out in September, there's sort of, I talk about the spectrum of engagement with Amazon, and so you can be actively invested with Amazon, and I would put the electronics brand anchor into this category. Do you use any anchor products? I don't think so. Oh, okay. They've become a big brand in the electronic personal consumer electronic space with charges and cables and things like that. And they were Amazon native brand. They were only selling on Amazon. They got really, really good at it. They use Amazon's product review ECO system as a market research environment. So they would read all the reviews, harness all of that data and figure out, okay, people are moving boards, people like this feature but not that one. And here's what they're saying about this. And so they have their, what I would say is an actively and invested company in Amazon's ecosystem.

Kiri Masters: 28:04 Today, they sell in 30 countries. You buy them in best buy, you buy them at the airport, so they've moved beyond that, but they're a company who's really embraced Amazon and harnessed the day that space made available to them. Then I would say like moving through the spectrum towards sort of anti Amazon brands, we would have friends who are semi invested and so they would, one example of this is a footwear brand who allows their, and this is very common in footwear, they allowed their retailers to sell, actually fulfill orders on Amazon, sell their products, but the brand itself might control the branding. Some of the advertising set some like conditions and set the reseller agreements with these retailers to say, okay, for this style you can only sell it for 69.95 or above, things like that. So they're involved with some aspects of selling on Amazon, but this still very much involved with shaping that brand experience. And then I would say is sort of this big chunk of ignorant brands who say, what's this Amazon thing? I don't want to hear about it. I never shop on Amazon. This is all going to blow over in a few years?

Kiri Masters: 29:12 And what usually to those brands, I would say search for your brand or products on Amazon. You will find them on there. There'll be being sold by third parties who may not be representing your brand or products correctly. And if you think you're not on Amazon, just be prepared for a reality check when you search for them. So this is the category you don't want to be in. And then there's a final category of actively uninvested with a strategy. And two examples here. One is there's a hair care company called Madison Reed. They make at-home coloring kits. Yeah. And they don't sell on Amazon, and they have a good reason and a moat around their products because you have to complete those questionnaires to find the right product for you. It's a very personalized product. And so the only instance I can think of this is like a repurchasing instance where I know if I'm shade nine nine one zero two, and I just want to buy it on Amazon, maybe that would be an instance where it would make sense, but they genuinely have a personalized product and a whole buying experience for those customers. In a similar vein, there's another company that I interviewed for the book called care of. They are a supplements brand, and they have a similar kind of thing. They have a personalized questionnaire to find out are you vegan? What kind of work do you do? Like do you need more or less of vitamin D for energy or something like that? So these are companies that have a genuine moat around them that enable them to keep their products off Amazon with a decent strategy.

Allison Hartsoe: 30:45 Well, and that seems like it's similar to the stitchfix strategy too. Or You could even extend it to Spotify where you're, you know, where that personalization element products that can be tailored all the way down or should be tailored are in that category of actively uninvested with a strategy. So are we saying then that if your brand is in, and I don't want to call every brand a commodity, but if your brand is a less personalized product, then yeah, it might make sense to have this not an anti Amazon strategy, but to have a strategy that doesn't necessarily include Amazon, but for everybody else then it sounds like they would be smart to think about an Amazon strategy and how they could make the best use of the information that is given. Like product reviews.

Kiri Masters: 31:30 Yeah, 100%. Because if I'm searching, if I'm your target customer, I'm searching for your brand on Amazon, you're not there. There's probably another brand running ads for your brand name taking that top search result and ready to welcome me into their arms. So, um, I think that there are those examples, care of, Madison reed, there's all the other direct to consumer brands of about day will be Parker, Glossy A all the away. They all have this sort of x-factor at a minimum that enables them to sort of have their own channel. If you're a commodity, you don't have that luxury. People are, I might be loyal to a brand of paper towels, but if you've run out of stock and you haven't really planned for that, or Amazon's like taking your product offline for whatever reason and I can't find your product on there, then there are 10 other paper towel brands lining up advertising to me that might tempt me away.

Allison Hartsoe: 32:26 Very much so. Yeah, I get it. Okay, so based on our conversation, let's say I'm a retailer, I'm like, oh gosh, I need to do something. What should I do first, second, third? How should I approach this?

Kiri Masters: 32:38 The first step I think it starts and ends with education. So this is, we're in an era where there's a lot of information about Amazon and how to handle things. I think that there's, to give my colleagues and competitors credit where it's due, there are people have gone to great lengths to publish really good information about Amazon, the different ways that you can get involved with that. So I think the first step is educating yourself on what's possible with Amazon. What is the best platform to sell on whether you have invited to be a vendor on the platform? In some cases, it's actually better to be a marketplace seller because of access that data and a bit more control, but you need to make an informed decision what's best for your company. So sort of wading through all of this content and coming up with your strategy. The next step is getting buy-in from your organization.

Kiri Masters: 33:28 There are some companies who are still like I said, resistant to Amazon. They think it's going to blow over and so you obviously Amazon touches every part of your company. There is the line item profitability I think about areas to fulfillment requirements to think about, so is your logistics really prepared for what's required with Amazon? Do you need to look into some alternatives there? It touches brand and product marketing, so you need to get all of these stakeholders on board if you're a larger company and old the singing from the same song sheet and committed to Amazon, the next piece is assembling your team. So this is, we work with companies who have a digital team or an e-commerce team and it's part of someone's job to handle the Amazon advertising as part of someone's job to handle, content as part of someone's job to review all the POs that come in and dispute inaccurate charges.

Kiri Masters: 34:21 If there's the internal capability. And then there are a lot of providers out there, agencies, consultants, et Cetera, who can fill in the gaps for you if you don't have a strength in one of those areas. Each of those have their own pros and cons. But the important thing is that you identify all the things that need to get done and that someone within your company or an outside provider is accountable for delivering on that. And then you need to keep educating yourself. All of these things that we've talked about, they all change. Maybe if we talked again in 12 months, there are 200 Amazon private labels, and I have a bit of a different perspective. So these are all things that you need to stay abreast of. Programs, rules best practices, they change constantly, and you need to have some kind of mechanisms to stay up to date with all of those things and make sure that you and your team are delivering a best strategy that you can.

Allison Hartsoe: 35:11 I imagine like Alibaba, there's probably an internal blog or some place that Amazon releases basic information about what's changing. Is that true?

Kiri Masters: 35:20 Yes. If you're they have news in seller central, I think that they could do a better job of this to be honest. And there the reality is there's just so many initiatives going on at Amazon changing, and they're not going to publicize a change to their search algorithm. That's something that is discovered by software companies and agencies, and they're like, hey, we just started this like this factor is now playing into SEO that we didn't notice before. Amazon will never like publicize that. So it's not really enough to just follow Amazon's content, which is why I do what I do really. So to help assemble all of that for brands.

Allison Hartsoe: 35:55 I can't tell you how much this reminds me of my previous eBay business where like a change in the algorithm would happen and everybody be like, why aren't my products appearing? Sounds very familiar.

Kiri Masters: 36:07 How long were you selling on Amazon? On eBay or you were?

Allison Hartsoe: 36:11 yeah, I had a previous company where we helped eBay’s titaniums work through the platform and understand what features to use, what products to use. It's very similar paradigm.

Kiri Masters: 36:21 Very similar.

Allison Hartsoe: 36:22 Yeah, and I've known that Amazon's been out there for a long time doing this similar process, but I guess what breaks my heart a little bit is the lack of customer-centric, really deep customer data, which I always feel is what drives a business at the end of the day. And yet they are revealing this product-centric information, which is a really great way to do market research, product-market fit. And I think that's an overlooked area of richness that you called out in that example about anchor products. That is really fascinating as it's definitely worthwhile.

Kiri Masters: 36:56 Well it goes to show you an anchor's been doing this for, I'm not sure how old they are, ten years old I think, and they were doing using those tools back when we didn't have half the tools back then that we do today. So I think that it is a really good case studies to share because they've grown this incredibly successful business off the back of Amazon data.

Allison Hartsoe: 37:16 Amazing. Yeah, really good. Well, Kiri, you mentioned that you've got a book coming out, so I definitely like to link to the book landing page in the show notes, but how can people reach you if they want to get in touch or they have questions?

Kiri Masters: 37:29 Yeah, I'm really active on LinkedIn. You can search for me there and send me a connection request, Kiri Masters, and if I can mention what we also talked about with this staying current and just all of the constant stream of information. How do you know what to do? I do have a new project coming out called the marketplace institute, which is really a platform for brands to stay current with what's going on with Amazon, including the ability to actually call us and asked us questions, which sometimes you feel like if you could just talk to someone for 10 minutes and who's a real expert in that area, you would be able to start seeing the forest from the trees. So with that feedback in mind, we created the marketplace institute.

Allison Hartsoe: 38:09 Oh what a great idea. And so they sign up to be a member of the institute, and then they can call or are you going to give out a phone number and get hammered with calls?

Kiri Masters: 38:18 Um, that was the fear, at least when we first launched being a member, we'll give you access to all about processes and best practices that we use on the agency side where I think people will be able to get a lot of their questions answered there. And if you need some extra help, you can call in.

Allison Hartsoe: 38:34 Very good. And so let's include a link to that as well in addition to your book link. And it's been an absolute pleasure to talk to you, Carrie. I think we've covered a lot of ground when it comes to what's the right philosophy on Amazon and a lot of little pockets that I don't think people realize in the general knowledge.

Kiri Masters: 38:51 Good. Thank you so much for inviting me on. It was a really great shot, and I think there's more to come here with on the data side of things, which is exciting.

Allison Hartsoe: 39:00 Yeah, very much so. As always links to everything we discussed will be at ambitiondata.com/podcast be sure to check there for the landing pages and the link to Kiri's institute. Remember when you use your data effectively, you can build customer equity. It is not magic. It's just a very specific journey that you can follow to get results. Thank you for joining today's show. This is your host, Allison Hartsoe, and I have two gifts for you. First, I've written a guide for the customer centric Cmo, which contains some of the best ideas from this podcast, and you can receive it right now. Simply text, ambitiondata, one word to, three, one, nine, nine, six, (31996) and after you get that white paper, you'll have the option for the second gift, which is to receive The Signal. Once a month. I put together a list of three to five things I've seen that represent customer equity signal not noise, and believe me, there's a lot of noise out there. Things I include could be smart tools. I've run across, articles I've shared cool statistics, or people and companies I think are making amazing progress as they build customer equity. I hope you enjoy the CMO guide and The Signal. See you next week on the Customer Equity Accelerator.

 


Key Concepts: Customer Lifetime Value, Marketing, Digital Data, Customer Centricity, Long-Term Customer Value, Marketing Leaders, Analytics, Creativity, Product Development, Audience Research

Who Should Listen: CAOs, CCOs, CSOs, CDOs, Digital Marketers, Business Analysts, C-suite professionals, Entrepreneurs, eCommerce, Data Scientists, Analysts, CMOs, Customer Insights Leaders, CX Analysts, Data Services Leaders, Data Insights Leaders, SVPs or VPs of Marketing or Digital Marketing, SVPs or VPs of Customer Success, Customer Advocates, Product Managers, Product Developers

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