Amazon Product Failure Part 6

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Gary Huang joins us from to talk through his amazon product failure, the impact and how he went about fixing it and preventing the mistakes happening again.

The product was a posture corrector brace to correct your posture and stop you from slumping when using a computer.

Why this product?

  • It was early 2016 and this was no amazon product failure
  • Used Jungle Scout to validate demand
  • Was low competition
  • Looked into reviews and found ways to improve on the product
  • Sold quite well early 2016 with 10-15 sales/day
  • Early 2017 things took a turn and dried up to 2-3 sales/day

How much Time and Money did you put into?

  • Still have hundreds of units and they are not selling
  • Invested thousands of dollars
  • 9m of cashflow tied up in inventory on this Amazon Product Failure

Where it went wrong on this Amazon Product Failure?

  • External
    • Selling well in 2016 but a rush of competitors came into the space
  • 1. Jungle Scout released a post at the start of 2017, the recommended list of products to sell
    • Our product was highly featured in this Jungle Scout post and list which led to an influx of competitors with this product
  • 2. We hadn’t maintained a high enough ‘Customer Feedback’ rating on the account as we were focussed on building SKUs
    • Got negative reviews for sizing issues and comfort
    • We dropped to 3.6-3.8 stars feedback
    • This enabled new competitors to come in with better quality prduts and higher BSR and took away sales
  • 3. We made a typo on the product SKU when we inbound shipped into Amazon on one shipment
    • There was one letter difference between two of our product SKUs
    • This led to Amazon incorrectly shipping the wrong product when customers ordered
    • Caused many negative reviews scores as people received the incorrect items
    • To fix this we had to pull everything out of Amazon’s fulfillment centre and re-label everything
    • This was in the US and was hugely expensive
    • Created ourselves a logistical nightmare in this problem

We tried to salvage this product

  • We created a 2nd Generation of the product with improvements with the factory
  • But it was too late
  • The market was flooded by this time
  • We couldn’t get back onto page 1 with the old or the new products
  • Also, we did not have a list to be able to re-target customers
  • We are currently experimenting with Facebook giveaways to stimulate this product to try off-Amazon traffic

Danny has had experience in this space

  • Size and shapes of people
    • Small, Medium and Liar are the sizes 🙂
    • A number of customers for this product are overweight and the unit doesn’t fit people in this position
    • Variation is sizing and colours can cause issues
  • Returns
    • People send them back
    • But when they go to return they are covered in sweat etc.
    • Reduced poor return states by including an infographic insert
  • Negative Reviews
    • Did inserts to show people how to wear it properly
    • And also, how it should be packaged and wear it over a t-shirt first to test in case you need to return (helps reduce return rejections)
  • Got it to a medical grade product too which helped

Cash stuck in the product?

  • Unit cost was not that high so less than tens of thousands
  • It’s not just the cash but it’s the time and energy that it sucks out of you
  • You can’t polish a turd – if it’s not great it’s hard to push it
  • 2nd Gen product is moving and getting better
  • Selling in US and expanding into Europe

Mitigate mistakes in the future

  1. Maintain a 4.5 Feedback rating – otherwise competitors can come in and steal your customers
  2. Product Research – don’t just follow the crowd, don’t do a me too product
  3. Didn’t build a list – thousands of sales but no customer emails, we couldn’t re-target back then

Building Lists – Difficulties

  • Yes, of course it is possible
  • The amount of people you need on the list, AND you’ve got to keep it active
  • You build a list of 100 and get a 10% conversion list – you hit the ten and then your new product comes out in a year – a long time between with a dormant list
  • Hard to keep it warm and effective
  • Lists become more important when you have a wider range and more than one product

Power of the Factory

  • At least getting three products out of the  factory
  • This makes the factory search more worthwhile
  • Gary has visited his factory several times and has a great relationship with the owner
  • There are other products from this factory and Gary’s variations are all from the same factory
  • Less hassle, logistics and time in using the same factory

Gary’s 3 Main metrics now for Product Research

  • 1. Strong demand, low competitions, low margin
    • Retail 3x Factory cost unit price
  • 2. Create unique content to market to customers
    • Recipe book, guide to fix pain pointes
  • 3. Is the product trending or just a fad?
    • Don’t want to do a fidget spinner that burns out quickly

One Piece of Advice

  • If product is selling well, don’t be lazy and rest on your laurels
  • Play offense and be proactive
  • Build a moat around your product
  • Maintain a 4.5 feedback score
  • Build a list
  • Diversify off of Amazon – don’t put all your eggs in the same basket

Contact Gary


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