Ryan Flannagan is the CEO and Founder of Nuanced Media, an international eCommerce marketing agency. On this episode, we talk about growth driven advertising, the importance of transparency and research, strategy development, and much more.
How Nuanced Media started
Ryan Flannagan: Nuanced Media was founded in about 2010, and honestly, we, we started out as more of a WordPress website development shop. Quickly moved into marketing and B2B market. And then in about 2017, and we are doing e-commerce kind of all along the way, but working on a number of different things. But 2017 we had a client that we've been working with and we made them about 18 and a half million dollars and about six weeks on Amazon.
And at that point we said, hey, there's something to this. Why don't we start looking at this a little bit more and building out from there. So ever since then, we've been focusing just on Amazon, building out Amazon. We do things in the Shopify ecosystem as well, but we're basically e-commerce marketing agency that help people really grow and scale on Amazon and take your business to the next level. And we do play a little bit on multi-channel, but more than anything we're advising on some other prior providers to work with and how to do that.
Growth driven advertising
Alex Bond: You're also an advocate and kind of an expert on growth driven advertising, which to my knowledge and the bit of research I did is, is the fact that brands generally should be concentrating on marketing the 20% of their products, which account for 80% of their revenue.
Can you expound on on that concept and how do you came to figure out that importance of that?
Ryan Flannagan: Yeah, so I think there's some factors that we have to look at and why growth driven advertising really focuses and works in the Amazon ecosystem compared to not that I wanna work on Shopify or Google or Meta or any of the social media networks, but Amazon's a little bit different.
So what Amazon does is by the more you sale on Amazon, the higher you rank organically for keywords. Amazon's about 48% of product search. Google's about 35% of product search but on Google, Google doesn't care if you sell one item a day or 5 million items a day, it's not going to increase how you rank in Google. Or how you show up organically.
It's different on Amazon. So because Amazon's getting a referral fee or commission on everything you sell, the more you sell, the more you're going to rank based on your listing, your optimization keywords you're converting for, and those type. So when you look at growth driven advertising for Amazon in particular, it really does make sense to look at your catalog and we, we like to focus on growth driven advertising, which is the 2080 rule like you're talking about before the Prada principle.
But on Amazon, it almost goes to the Parrado principle on steroids, if you will. We've seen catalogs that 2% of their catalog is making 90% of the sales. That's because each listing that you have and each individual SKU that you have. Let's say you have a black shirt. A black men's t-shirt, that one can get organic rank and really start selling while the blue men's t-shirt on the same side isn't gaining traffic on it.
Right. But because that black men's T-shirt is selling, let's say 5,000 units a day, or 300 units a day, or whatever that number is, it's going to rank higher organically in Amazon. So you wanna focus on those products and doing those really well because then you can get the flywheel effect working on Amazon and really spike your organic rank and really increase your sales.
And the best way to do that is to look at your catalog, what you're already selling on Amazon, say what are the things that are making a majority of our sales with the appropriate margin? And then like, let's double down on those and do the split testing, the copywriting, all the other things that are really, well increase your conversion rate on. So we really can kind of take you to the movement.
Alex Bond: And as part of the hope there, that if hypothetically your black t-shirt is the first thing that pops up on Amazon when someone search searches for black t-shirt, then people will see the other products that you sell and kind of bootstrap all of your products all at the same time.
Ryan Flannagan: Yeah. So, so there's definitely a method of the madness with that. So, Amazon is fundamentally going through kind of a change. So Amazon for the longest time has been a department store. Right. You come in, you buy one thing, you don't really know the brand you're buying from and all those things, but Amazon's transitioning into more of a mall and, and with that, you know, they have Amazon storefronts, which you typically had to click on the brand link and then go see the storefront.
But what we're seeing them do is integrate more things into the listing themselves for cross selling. So the first opportunity that you get with that is your product family. So in this case, the black T-shirt case, you could have a number of variants based on sizes and colors, right? So they click in for the black T-shirt and they're like, oh, I really like the blue T-shirt.
I'm gonna go over here and actually buy the blue T-shirt instead. But the other thing that they've done is they've recently introduced what's called a brand story. So you can scroll down the page and it's kind of crazy, like if you look at Amazon right now, it's only like maybe, maybe 5% of listings have integrated the brand story.
And you scroll down on there and you can see a little bit more about the brand. And it's not the a plus content area, but you can see up to, I think there's about 18 different modules you can put in of other things that you can buy from that particular provider. So that really kind of opens up the capability and the opportunity if you have a larger catalog to cross-sell and upsell accordingly.
Their research process
Alex Bond: And so in your brand's pitch, there's a great emphasis on research, which you've already kind of displayed. What does your research process look like and how can a startup, an entrepreneur, Conduct their own research efficiently?
Ryan Flannagan: Yeah, a hundred percent. So it depends on where you are, the face of the company and what you're doing. So we typically work and we do work with clients that are launching, but we always set up expectations through going through an Amazon action plan to say, Hey, if you're going to do this and you're really going to give yourself a go.
You can't do this with $5,000. So anybody who's telling you is trying to take your $5,000 and not really setting you up for success. Right. And unfortunately in today's world where there's a whole bunch of Facebook ads and get rich quick schemes and all this type of things, those things happen. So before we work with anybody, either that's an existing seller, existing sellers, we typically like to see them over minimum of like about half a million a year at going up from there to really qualify for growth driven advertising.
Or if you're launching, we basically sit down with you and we look at the category, we look at the segment trends, we look at if it's growing, if it's not, and and these other things. So what we typically do is do a competitive analysis. We look at the keywords. We do advertising when running growth driven advertising.
We do split testing of the images, and I can kind of give you some different things on that. But we wanna track performance in the market share. If you're launching, it's kind of a different level. You wanna see what the market looks like. You wanna look at your unit economics, because Amazon takes a pretty big percentage, right?
And you wanna figure out, well, what's Amazon's fee for your market? Right? Like, what's the referral free fee? And then how much is shipping? And if you're not north of 30%, you're really setting yourself up for failure because when you're launching, you aggressively have to go after ad spend, and we can see sometimes that's 20% of your margins or more when your launching is going towards marketing.
So then you're only taking 10% back, right? Sometimes we see that you're actually losing money for the first three months because you're trying to get that flywheel effect going on beforehand. But that's kind of for the existing thing. You need to look at this and you need to say, well, what do I need to invest if I'm really going to play in this area and really give it a go.
And honestly what we see with the ads spend set up with us doing everything and all that type of stuff you're carrying in the 30 to 50 range to really give it a go over six months or so, market and, and, and do it right with video, with really trying to crack the code and go at it and build and then you can get some praise, sustainable returns.
But yet to identify that that's the sum cost going. Now, if your existing brand, you're already selling half a million up a year. What we typically do is we do another version of the Amazon action plan for growth driven advertising. First of all, if you're at that 500 plus level, we do a free quick analysis.
We call it the Amazon checkup, where we just before g a software login or anything like that, we just look at your brand, we look at your listing optimization, we see how many people are advertised on your brand. We look at your catalog stuff and we say, Hey, it looks like there's an opportunity here or not, or there really doesn't.
So you know, we should probably not continue. If we qualify, it makes sense. Then we go through the plan and we do a deep dive into the competitive research. What's going on? Gain the segment analysis going on. So the segment analysis is because Amazon has so much. Right. We can actually find for that black t-shirt if the market's up or down, and we need to set ourselves accordingly to that market being up or down.
Right? That that's the real key that you're looking at, and that's actually something that's p possible on Amazon compared to not. The reason that that's so important is you can be celebrating, saying, Hey, we're 20% up month over month on Amazon. We're killing. But then you can look at the market segment for those black t-shirts and find out the black t-shirt market.
Orange is the new, black is a New Black again, just came out and everybody's buying more black T-shirts, right? And the market segment's up actually 50% a month over month. So you're losing 30% market share on that, but thinking you're doing a great job. Or the inverse is going on that you're down 10% month over month and you're losing your hair going like, why am I losing all my sales?
To find out your segment's actually down 50% and you're actually gaining more market share. Right? So those are some of the analysis that you wanna do to break down and build that. We do have pretty comprehensive paper click analysis and those type of things that put together a really strong strategy for moving forward with growth through and advertising if you're established, if that makes sense and you're doing that.
When we do growth driven advertising, it's not just about advertising, right? That's the misnomer that everybody kinda has on Amazon. Everybody thinks it's a singular ecosystem its not. We look at what you're doing on Amazon, what you're doing off of Amazon, and we can recommend multi-channel strategies that we've seen work for our providers over and over and over again.
Now, the reason that this is important, is the typical customer on Amazon is pretty price elastic, meaning that if it's a dollar less and the reviews are about the same, I'm well spend a buck dollar less to buy. Right? But if you're focused on Amazon, on how it works as your brand overall, Well, I could maybe charge $5 more if there's more brand awareness and they saw your ads on Facebook or Instagram or TikTok or whatever.
First, that buyer's Journey is going to a be directed to your website where they should be doing the purchase. But sometimes they'll do a literacy test and say, well, let me see the reviews on Amazon first and make sure if it's working. Or not. Right? And based on that, we see that our typical client has, it's anywhere between the 30 and 70 split, meaning that 30% of their sales are on Amazon, and 70% are on their website.
Normally Shopify, or 70% of their sales are on Shopify, and 30% are on the website. Right? But you have to look at holistically. If you're just doing Amazon by yourself, it's gonna be significantly harder to win that gamble. because there's extra external forces that will drive that sales velocity to get you to rank higher, to get you that organic spot that's in the, you know, top three on it.
Alex Bond: There's just too many factors that are outside of your control.
Ryan Flannagan: Right, right, right. And you just wanna take like a holistic look at this, and this is why really, we really call it growth driven advertising because you need to look at what's happening on Amazon, what's happening on your listing, or your image is good.
Are you doing split testing? So some things that we've found for some of our clients is Amazon's been pretty stringent with their terms of services. That has to be an image with the white background and all these type of things. Well, Amazon has recently found out, well, maybe we should start playing this, playing with this.
So toy store company we work with, that's a premium product. Their toy swords are about $50 compared to the traditional toy sword being a foam sword of $10. Right? We basically tested putting a, having a kid holding the sword. Compared to it just being a sword on a white black background. Increase, increase, click-through rate by a hundred percent.
The kid with the sword did, right? Yeah. The kid with the sword. And you could do split tests in the back of Amazon, right? If you get more there, then you get higher more conversions and conversion rates stay consistent. We tested this for the kind of personal safeties market. The sirens market the little siren that you can pull if somebody's attacking you on your key chain.
And we got an increased rating of about 678%, right? The click through rate went up by 678%. The conversion rate dropped by 10%, but you went up by 6x, so you can drop 10% and be okay with that. Right. So there's some interesting things with going and then split testing and focusing on that. So those are some of the things that we can control within the Amazon ecosystem.
We run Amazon demand side platform, which we can do streaming tv, we can do a variety of things like that. And really strong competitor conquesting. But the other thing that you wanna look at is how are we doing with all of what we're doing, the optimization, the conversion rate, the split testing. And then also what are we doing off of Amazon and how do we advise on best practices for that too?
So you're literally focusing on growing your Amazon sales in a holistic manner compared to just kind of the tactics that worked really year good five years ago, but they just don't work anymore.
Alex Bond: I think it's interesting when you start actually talking specifically about these products and split testing them, have you found that there are some products that are more difficult than others or, or industries that are more difficult than others in your research, in your practice and your experience?
Ryan Flannagan: Yeah, a hundred percent. We work with a number of supplement brands. Supplement brands. Like you'll be selling a $17 elderberry, right? And the cost per click is $6, right? So unless you're converting at 33%, You're not even a break in even. And 33 percent's a bit high. Yeah, that's a bit high. Yeah. Although you see some things with the right reviews, you can get a high, high conversion rate.
Amazon typically converts five x the conversion rate than your website does. So whatever your conversion rate is on your website, think of multiplying that by five. And that's probably the conversion rate you'll get on Amazon if you're optimized. But, so when you're looking at that, those are all very intensive and that's when you do wanna say, well, maybe for elderberry we should look at a multi-channel strategy.
With our website and we get some of that halo effective people coming to Amazon to purchase from us as well. Now, the thing that people don't talk about enough with this is that Amazon plays a pretty important journey for the rest of your marketplaces as well. So we have a client that just launched.
They have a lightning cable that's revolutionary and they also have a cable that's revolutionary for Android. Doesn't tangle beautiful piece, very well certified. They're Indiegogo for about 600,000 and we have 4.9 star reviews for them. They've done it extremely well on their launch, but they're a $37 lightning.
For charging her phone. So maybe they'll never be successful on Amazon, because the average lightning cable on Amazon goes for about $10. Now, is that really MCI certified? Is there some other thing? Well, who knows, right? With looking at that, every other channel that looks at this client now, Before I spend $37 on a lightning cable, if it's in Best Buy or it's from a Facebook ad or anything like that, I will look at an Amazon and if it doesn't have a 4.7 or higher review status, I'm not gonna buy.
Right? So that's the thing that people don't look at with the Amazon journey is that on a premium product level, it's really important to have that credibility queue from Amazon, cuz then they're gonna still purchases from your website, but wanna make sure that they're buying it that way. Now, Alex to answer your original question cause I did have a tendency to go off on a tangent there.
What we typically see when you're looking at total returns on ad spend, now getting back to that kind of flywheel effect that I was talking about before. When you look on ad spend on Amazon, you will look at it a little bit differently compared to just Realo or ACOs on there because for every one sale I make attributed to a advertising sale, I can make three organic.
Because the more sales you get, the higher ranking velocity. So instead of just when you look at your Facebook ads, you look at your return on ads spend, say, Hey, we're doing a 5x Facebook to my Shopify website. That's great, but that doesn't get you higher organic position in Google. Amazon, it gives you higher organic position.
So what you really wanna look at is ad spend to ad sales and your organic sales or total sales. So in that initial example, I said, you know, you spend $1 in advertising, you sell one good of products on that, then that would be you know, one, one x one return on investment. But if you sold three organically, that would be a 4x on.
So what we look at on Amazon and our typical clients that we have up and are mature, either are making a five x meaning for every $1 they spend on advertising on the Amazon platform, they're making $5 on Amazon to a 20 x. Right, and some of them are actually doing it better than a 20 x if they have really good brand and they're not in a competitive category and these type of things, but that's the way that you wanna look at it.
We literally have some clients that we're spending, you know, 20,000 for a month and they're. Taking home profit 120 plus thousand.
Alex Bond: No, I mean, that's absolutely beautiful to see how that operates. And it really makes me think like, are there certain marketing avenues that you generally lean toward or away from?
I mean, Things are obviously constantly changing. So what might be in vogue today might not be tomorrow. So are there certain things you are torn or away from in terms of, I don't know, tv, social media, billboards, that's that sort of thing? I know that's kind of all over the place, but.
Ryan Flannagan: Well, no, no, I think that's a great question.
So I think that comes down to a pricing question, right? So we know the buyer on Amazon's pretty price elastic, right? They're going go for the least costly priced or the lowest priced item on Amazon, they can get away with it unless there's brand awareness and they've already been convinced on the brand.
Right? So what we typically see for companies that are exclusively successful on Amazon is they're competitive price-wise. They have their reviews, they're being 'em out, they're doing those type of things, and then they can really scale. Those are the ones that are doing the 70% on Amazon and 30%.
Now the ones that are doing it, 70% on their website and 30% on Amazon are the ones that have more premium pricing. And with the premium pricing, that's typically when you get into the video ads, social media, TikTok, Google Shopping, all these other type of things with that. Because that's, people will skew with that and they have more brand recognition.
Now, I'm not saying that you don't do that if you're price elastic in your time, lower price on that, but you also have less margins, so it's harder to spend a lot of money on those other ads as well. So that's kind of the skew of that. And honestly, we typically recommend working with an agency that'll walk you through.
Your unit economics, what's your profitability on this? What's it gonna cost to do this? Sign up those real, expect realistic expectations. Cause if you don't have those upfront then, then everybody's gonna have a really hard time. And I didn't, you know, found nuanced media via churn in burn agency. And those are the things that you just, if you're upfront and say, Hey, this is a $50,000 risk. And everybody knows that, then everybody hopefully can sleep within at night if it doesn't work. Right. But ideally it'll work if you're doing that.
Importance of transparency
Alex Bond: Can you expound on that part of things? I mean the transparency piece? Sure. Because I know that some people struggle with that. They want a client, they want to get 'em in the door.
They need to keep their business running. But you seem to have a lot of value on that transparency. Maybe not necessarily tough love. Building that relationship. Can you kind of dive into that a little bit for me?
Ryan Flannagan: Yeah, to be candid, you know, I had a company that failed before.
I'm an entrepreneur, but I lost a lot of money at one point, and I really just don't wanna do that with people. And if you really look at it at the level with business, it's self-serving to some levels too. Because if I can go in and make you. Then we have a longer term relationship. Everybody's happy and we both make more money together.
It's a win-win, that type of thing. If I bring you on and I can't make you money, then we work together for three to six months, have a really rough breakup. No one's happy. My employees aren't happy cuz they've done a ton of work. You're not happy cause you spend a ton of money. No one's happy at all, and there's less value in it in the long term for both of us.
So honestly, I'd just rather bet on winners that have a chance to win, cause it's a win-win. And if I can win for you, then we all win together and if I can't win for you, then there's a hit on our side too. So that's really kind of where we come down. Now our projections aren't a hundred percent, but where we're finding the most success right now, to be very candid, is brands are selling at least to half a million plus.
And them getting there, getting established, and then just missing a lot of low hanging fruit. We brought on some brands recently that. You know, 10x or sales and five months, you know, just because their stuff wasn't done. They weren't aggregating their product families appropriately. Like, I'll give you a quick example of this.
So reviews is one of the biggest things that you can get on Amazon, right? So we have a client that we brought on, we started working with them in I think June, and they had one product that had 60,000 reviews. Now you don't have to have 60,000 reviews to work with us, right?
But I'm just giving you the example. And or we have another client who had a thousand reviews on one of their products and they had two other products that could go in that product family that had, you know, 300 and 100 reviews. So what we did in this case is we put them all in the same product, family, the reviews aggregated, we did the optimization, we did the split testing, we did all these type of things, and they go through the roof.
Because everybody is seeing these now, see the reviews, they're like, Hey, that's the one I wanna buy. That may be a little bit more expensive, but the next one is $5 less expensive, but they only have a hundred reviews while this guy has now 1500 reviews. So there's some low hanging fruits, there's some catalog analysis that you wanna do.
You wanna come up with a recommended strategy, and then you wanna choose your like hero products that you're going to go through. The split testing, you're going do all those type of things compared to every listing that you have completely, equally because Amazon doesn't treat 'em that way. So why should we?
Nuanced Media vs. their competitors
Alex Bond: So your business model also emphasizes, and as you've explained to me heavily that one of nuanced media's strengths is analyzing what kind of strategy to use when, you know, we hear about the split testing all these different strategies, but actually figuring. Which one to use, where is extremely interesting to me.
What separates you from your competitors who say they could be doing the same thing?
Ryan Flannagan: Yeah, sure. So, you know, some competitors a say that they can do it all in-house. Right. And you know, those are the type of things that I'm always a little sketchy on because you only can do so many things so well.
Right. And it takes a lot of process, it takes a little bit of development with that. We don't do social media and how. We don't do those things. We do Shopify, we do Google shopping, we do Amazon, and we do kind of the Amazon side of those things. Those are the main areas that we play with with email marketing such if we're working for really doing TikTok and those type of creations and all those type of things, we have a vetted network that we refer out to to say, Hey, Alex, like you're doing a great job with this.
We recommend that you start working with this company cuz we have all the foundations set up for you to be. We're syndicating reviews at Google. We have all the reviews that were on your Amazon, we've imported them to your Shopify site, so now you look really good from a conversion rate. All the reviews are there.
We're running on Google, we're running on Amazon. This is all a kicking butt. But now we really need to start pushing for some brand awareness here. Here's some different partners. Here's our pricing. This is what we do. This is who we recommend working with, and then that takes all the work that we've done to the exponential next.
They do that very well. They build out on that and they do those things. So when we work with people, we may basically look at the more holistic level and then we know what we can do and we know what we can't do, and we really focus on those things.
Alex Bond: Yeah, surround yourself with the best, the people who are the experts in there identifiable fields. I think that makes sense.
Ryan Flannagan: It's also doing yourself a disservice if you're trying to do everything for everybody. Like, you know, do what you do and do it better than anybody. and if you have other people who do that one thing better than everybody else, get them in on your project because I know by hiring the best agencies to run the social media and all those type of things, they're going to make me look really good if they're doing a good job.
Because, you know, online it's really your foundation, which is your website and your Amazon account, and there's obviously other marketplaces, but typically if you have a Shopify website, it's done well. You can export to Etsy and those other marketplaces. And then any social media marketing or any type of media buying or anything like that that you're doing through those levels just adds more fuel to the fire. It makes that going better, but you have to have the engine build appropriately to be able to drive.
Alex Bond: Yeah, I like that analogy. How long would a client typically work with nuanced media? Do you, do you bring clients on extremely long term? Do they generally, you know, come on until they reach where they want to and then say, I got it from here. What's that kind of look like?
Ryan Flannagan: Yeah. So what we do that I think is pretty interesting is for our full ser, so we offer queue service lines. We have the full service marketing one where we do your Amazon, we build listings. We do copy, we handle bugs, we support an inventory, and then from that we basically can build out your Shopify and do all those types of things, right?
So quite frankly, when you start out doing those things, it's a lot of money. Like, cause you're building this, you're meeting with us weekly. There's just a ton of work to be done. But after that, you know, initial, depending on. If you're doing a website or not and how many listings you're doing, but let's say initial six months, then we go down into the model where we're just basically managing your advertising and doing these type of things.
So when we work with clients, you know, we have some clients I've been working with since 2017 and really dive in further into the Amazon side of things, right? And then we have. Clients that we're just not a good fit for and we don't work. But our average clients significantly longer than the typical marketing agency. I think the typical marketing agency is like a six month lifetime value. Wow. And we're way above that compared to the norm.
Alex Bond: No, that's great. That's great to hear to continue to foster that relationship long term, you know?
Ryan Flannagan: Right. Well, and if we're, if we help you win and it is a win-win, then there's the value to that. And then for the people that we've been working with for years, we can always come back and say, Hey. This is working really well for five of the other clients, we should get you on this too. Then it's a great way to continue to build that, and ideally, they're profitable at this level, so everybody's kind of winning on that.
Keeping up with Amazon
Ryan Flannagan: Well, I'll be can on Amazon it's a little easier because they do a pretty, it's in their business interest. Like the biggest threat to Amazon is they're being a ton of fake reviews that people lose their trust in Amazon reviews. So we have a multi-billion dollar, maybe trillion dollar company at this point going, we really need to pay attention to this and crack. Right and on Amazon, because you're playing within the rules and looking at those type of things.
And the risk is if you get caught, you're in real trouble. It's going to be less and less of a concern. Now, where it is a concern, and I'll give you an example of this. Where it is a concern is when you're looking at Facebook ads or meta ads to Shopify or anything like that, or YouTube ads. Cause people can basically do anything, right?
So you know, it's the new year. I was looking at this company. I got served up a supplement ad, I think it was called Arctic, cure or something like that. But the basic concept with supplement was that it simulated people that were, you know, in the Arctic or something like that, and it would raise your internal heat so you would burn fat more quickly.
Right. So I'm like, okay, well I'm going to get, that sounds great. I could lose 30 pounds. It's a new year. Let me do some due diligence. Right? So I searched for that brand name and I looked for reviews, and then there's all these people on YouTube reviewing it that obviously had never taken the product. It was the exact same script for everybody.
Oh, wow. And all these type of things. They weren't on Amazon. I couldn't see anything on reviews for Amazon. I couldn't find anywhere and I didn't buy the product eventually because like somebody basically gave you the pitch. I got stuck in that long form 30 minute video talking about how the guy is from Texas saying cares about everything and wife, and he's Jackson.
All you need to know is this ice hack , you know, and then all your problems will be solved. And then at the end of the 30 minutes, you know, then they're like, buy this $60 supplement to get it right. But those are the type of things that happen off of that, and this is why having validity on Amazon is so important for your brand because what I do, first thing I do is go check Amazon to see if there's a review on there.
If there's good reviews, then I'll buy it. Another example of this, and this is about six months ago when it was more the summer and mosquitoes were everywhere, I got an ad for a 13 year old who had developed this mosquito killer thing, and it was a new sound, well wave and killed mosquitoes for two kilometers around your house and they got 10 million in funding.
I'm like, oh my God, if this is real, I want this yesterday. Right. Never deal with them as keto again. And then I looked at that, I kind of did my due diligence, and then I looked at their Amazon and they had like two and a half storms. On this product. Wow. Right? And I'm like, no, it doesn't, you know, it doesn't work.
If it killed, it would be a five star. So I'm not buying this, you know, product that's twice the, the average mosquito zapper product. So that's where, and this is the bigger conversation, right? When we come to Amazon, we come to brands, is. Amazon is very similar to where social media was in the early two thousands.
You have these bigger brands going, well, I don't know if I wanna be on Amazon. I don't know if I wanna be giving commission. I don't know if I wanna be doing these type of things. But if you're not, it breaks down everything you're doing in the customer journey. Like it or not, Amazon's here to stay just like Facebook is just like social media.
And by not going in there and playing, somebody else will start selling your stuff. Put up bad images, do bad reputation. Just like back in the day if you weren't on Facebook or Twitter, whatever people would start complaining about you and that you weren't there to defend yourself. And there was just a whole big complaining fest.
Right on Amazon. What happens is people will start buying your products, start selling it on your behalf, marking it up, not doing good customer service, and then you get bad reviews on your product and it's gonna effect all of your other chips.
Future of Amazon
Ryan Flannagan: Yeah, well, and like, to be honest, where I'm seeing the different things evolving, there's a ton of things happening on Amazon of course. Cause they always are, they're getting into Amazon lives, they're hanging into the QVC model.
Meta has tried the store, things on that limited success with they're doing. But the, the next big players, I think Shopify and what they're doing. So through Shopify and Shopify play, they're basically building out a market. Right now by being, and this is why we always recommend being on Shopify, or if you're an e-commerce brand, because they're going to have some massive advantages that you have on compared to other platforms because now you can seamlessly integrate and sell on YouTube, right?
Almost directly because they're partnering with Google. On that, you can click three buttons and integrate your full catalog to Etsy. You can do these other type of things, which really makes you significantly more nimble on. So when I look at those are the two kind of players. It's Amazon and what Shopify's doing.
And Amazon on the other side wants to be the place where everybody goes for e-commerce, Amazon's giving you more capabilities to start contacting the people who've been past purchasers. They're focusing on this becoming a mall compared to a department store. They're doing all these things too. And the biggest thing that's happened is they've opened up the brand referral.
The brand referral program is basically average referral commission to Amazon's about 15%. Majority of time. With this, you get 10% back, so you're writing your Instagram ads and all this stuff you direct to your Amazon page. If they purchase through that link, you get 10% back, right? So now Amazon's fee is $5, 5%, not 15.
Right. They increase their flywheel and you're getting more sales from that, so you're getting a higher rank on that. And then that's really kind of building out that whole thing. And we know Amazon converts five x typically more than your normal website, so that's where Amazon's going.
Alex Bond: Yeah. And on kind of the other side of thing. I mean, full disclosure to all listening, I did work at Amazon in like a warehouse for maybe six months or something like that. And, and what kind of impressed me was that they run their logistics side of things too. I mean, that someone like a, like a Etsy or, you know, your drop shipping from your website or something like that, generally has to go to one of these third parties versus Amazon.
You buy it from Amazon and then Amazon delivers it to you where it's, it's not changing hands as many times. Is that something that you kind of see in the future changing as well?
Ryan Flannagan: Yeah., I mean, Amazon. We don't wanna talk about the car market, which they're getting into, like Amazon's everywhere, right?
Like they are something to be reckoned with and something that they've launched. It's been about 18 months now, so it's been around for a while. But multi-channel fulfillment. So basically they've set this up that you can send all your inventory to Amazon and then you can fulfill all your shipping through your Shopify website or whatever other website that you're using through Amazon's FBA.
Right. So now your whole website gets two day delivery. You have one source where you send this stuff to. It does all those type of things. You're not worried about inventory limits. With Amazon, it's hitting the easy button. So what we traditionally do when we work with a, a brand that's established or not established, we'll do the Amazon first.
We'll go in, make the best listings, we'll build all that up. Well, cause it takes a while to like create the user-generated content, video, do good design, do the keywords, build all that up. But then we'll build a Shopify site. We'll import a reviews that we've gotten on Amazon and then site Amazon back the from Shopify to the Amazon.
And we'll fulfill on the Shopify site through the Amazon inventory that we have, right? So now 48% searches on Amazon, 35% is on Google. You have two marketplaces. So based on that, you have. 80 plus percent of inbound search covered by your Shopify website and your Amazon side. And then once you get those two things flowing, then you can start working on really pushing the pedal through your awareness campaigns and all your things you're doing through Meta and Twitter.
Not really Twitter, but TikTok and these other verticals, right? So that's the, the game plan. When I look at the ecosystem, it's Amazon first because you can get the reviews, you can see it, you can take the time to do the content. For a new brand, then it's your Shopify website. You basically take what you've already done on Amazon, reuse your Shopify site, get Google setups, so you write ads on those levels.
Then you start doing the big media pushes. And that includes YouTube advertising, which we do but through Twitter, sorry, TikTok meta, you know, Facebook and Instagram and all those type of things. Now, the other thing that we see is sometimes we're working with existing clients that already have a really good brick and mortar, a present.
And with this, we see that doing the good Amazon reviews and all these other things really build that out as well. So you know, you're looking at buying a dishwasher. You're at Home Depot. You look on Amazon to see if they're good reviews or not. If they got good reviews, then you're golden. If you don't, then you're not qualified.
Alex Bond: That's how people are gonna check at the end of the day, is again, even though they're in the store. Yeah, right there. They gotta check the reviews somewhere.
Ryan Flannagan: And sometimes you're going just hit by now on Amazon. It's changed the mind.