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Anthony Lee returns and speaks about Amazon Failed Products and how his product failure unfolded.
There is nothing wrong with a product go sideways – product failure this stuff happens
Everyone will get a dud product at some point in their career
- Anthony has had more than one dud product
- Sometimes it can be nature of the beast
- Sometimes it can be because you are being stubborn
- This one product failure cost Anthony the most money lost
- It was in the Baby space and it was a baby-carrier
- Entered the space when no-one was in the space as it was heavily regulated and expensive to insure it
- Anthony entered the space and it was lucrative for a time
What made you choose that product?
- Been in the space a while
- I had seen this product and niche work
- So I thought I could build a better product
- I put sweat and tears into the product
- Rationally – he picked it because he was too emotionally involved
- I had green-eye monster and saw lots of money in it
- It was expensive to make and therefore justifiably more expensive to sell
- Private labelling is a fantastic business model
- All the big brands had their own designs and I wanted to copy them
- I thought the sky was the limit when i came up with this concept
Where did it all go wrong?
- Intentions were good
- Making a better product was good
- I made the rookie mistake and believed if I build it it would come
- I did not listen to what my customers wanted
- Anthony is very data-driven so this is a complete shock
- At the time Anthony had been struggling through some difficulties with other products and he wanted something more innovative
- Instead of looking at the market and analysing it – it was more important to Anthony at htat moment to get a novel innovative product
- Guess he was blinded by the product at that time and didn’t do his usual analysis
Started going sideways when…
- Anthony started with the modifications that customers wanted
- Waist strap needed padding all the way around with velcro, etc.
- He made a better product but it turned south when he added interchangeable panels with different designs
- Meant people could buy one carrier and have multiple panels to change the design
- Anthony chose the most popular colour ‘grey’ for this an his design of panels that screwed it
- You had to like ‘elephants’ and there is one neutral, one boy and one girl colour
- That’s how Anthony messed this one up
How much did it cost in time and then financially?
- Spent 2.5 months in design cleanup for this product failure
- Attempting to recover was an additional 5-6 months
- The financial blow was the biggest from the product failure
- The product before shipping and amazon fees was $22k wasted with next to no recovery
- At least $4-5k in shipping and customs
- So many promotions etc it was probably about $35k in total
- You can re-earn money but you can’t buy back time
The emotional thing
- If you’re not careful, you can run a promotion and rank
- Getting there is fine but sticking it therre is harder
- Out of the gate on this product ranking was fine
- Product was priced too high and it wasn’t a product people wanted
- Although Anthony has access to lots of data – This made Anthony learn so much through his own failures
- When you make a few sales and it’s consistent and then you do promotions then it’s a stepping up and slight correction and then stepping up again effect
- The more zero sales days you have the harder it is to rank – even with promotions it won’t do it
- Anthony saw his product keep sliding and basically every sale he made on that product has been a promotion sale
- He watched the Amazon algorithm just crap all over it
Key takeaways
- How I started was great
- Anyone selling today has a valuable resource already – customers
- Find a way to ask them what they want
- Don’t deviate and think your ideas are better
- Don’t make concessions
- Find out what the y want
- Find your current or another manufacturer that can do it
- Run smaller tests
- Keep control on product costs
- If you ‘think’ the margins are there or you can sell higher – it can be a trap
- Don’t only allow big brands to be your standard – they can fool you
- Keep your magins realistic, manage your costs
- Don’t get an ego
- Start small and build up from there
- Danny did a similar thing with a product and had to pull it off the shelf when it was selling 80 units a day
- Danny spent far to long building the brand and everything around it for 6 months where he could have launched a couple more products
- You can get 95% of things people want right, but that 5% can trip you up
- Ranking and getting there is only one part of the product – if customers are not voting with their wallets then you need to make a call
- THE MOST IMPORTANT THING – you have to be able to recover and dust yourself off
What are the three key criteria for sourcing now?
- Following this great lesson
- Anthony’s approach has changed
- 1. Never lose sight of keeping cashflow – no unique design brand driven I’m keeping the cashflow open
- 2. Keep everything lean now – rather play the game of putting 1,2,3 initial orders in for 1,000 units and scrambling to keep in stock than jump in for 5,000 units after 2nd order and getting caught out and paying long-term storage
- 3. If I’m brand building products I’m going to do a ton of market research or listen to his customers and don’t deviate
- Using a new spreadsheet with the data points that are needed for product methodologies that work
- Anthony is working on this and will look to share when it’s ready
Final advice – The One Thing
- The one thing is communicate with your customers, your audience and keep the lines open and LISTEN TO THEM
- You will not get more valuable information than from people who are voting for these products with their wallets
- Give them what they are asking for – billion dollar companies know this and do it
Best way to reach Anthony
FaceBook – The Unofficial Anthony Lee page
