Selling 7 Figures off of Amazon with Chad Rubin

Chad Rubin joins to talk off of Amazon.

  • Skubana is a software offering from Chad
  • Background with parents owning a Vacuum store
  • Moved to Wall Street and covered internet stocks
  • Took his parent’s business into direct model
  • Vacuum spares and accessories is core product range

Built Software to run his business

  • Moved into Home accessories and an eight figure business with one employee
  • Couldn’t find a software stack to help run his business
  • So built Skubana to power internet businesses

Selling off of Amazon

  • About 50% of business off of Amazon on an eight figure business
  • Started on Magento and then moved to eBay – was a first generation Amazon seller
  • Other marketplaces are like the wild west now
  • Chad’s product is very commodity – not a sexy product
  • Could be doing much more business of Amazon if a sexier product

Tips to Sell off of Amazon

  • Find opportunity that Amazon doesn’t play in
  • Think about Casper mattress, Warby-Parker, Away Luggage, Allbirds shoes
  • All of these disrupt and go super-niche, provide an experience and take customers on a journey outside of amazon
  • What are categories that are ripe for disruption and can sell off of Amazon
  • Vape juice can’t be sold on Amazon and a massive opportunity off of Amazon

Demand driven by Search

  • Switch to new products a lot.
  • Innovative products and going where the market is
  • Driven by search and finding demand and no supply – the white space
  • Where we see a lot of people searching for a product
  • Not fishing in the same pool as others

Marketing on Amazon

  • Most stuff now is just common sense
  • Curating your listings
  • Making them built to sell
  • Focussing on their conversion rate
  • Optimising 50% for Amazon search and 50% so that the customer actually buys that product on your page
  • PPC sensitivity analysis that no-one else is doing
  • Look at what you’re spending to what your making and the correlation
  • No proof that the more you spend the better your rank
  • Tested by spending as much as possible to dominate in his niche
  • Hired a banker to understand the correlation between spend to make – showed a very low R co-efficient between spend to make
  • A connection between what you spend and what you make – get R co-efficient to as close to 1 as possible

Lower ACoS and make money

  • Started to dramatically lower ACoS – really dramatically reduced spend here
  • Not in business to spend money just to get a higher BSR
  • Everyone’s job in my business is to spend money to increase the bottom line
  • A paradigm shift in the company
  • Increasing page rank just benefited Amazon
  • If all things remain constant but adjusting the ACoS what gives the most amount of money with the products that we have with the spend that we have
  • Made the mistake of focussing on increasing rank rather than making profit
  • Have a Tier 1 SKU, Tier 2 SKU and Tier 3 SKU – then calculated the proper ACoS for the SKU Tiers, not all SKUs are the same ACoS

Off of Amazon Marketing

  • Don’t do a lot of social Media as in a commodity space
  • On every channel off Amazon – about 18-20 channels (Jet, Walmart, eBay, Groupon, Overstock, Home Depot…)
  • Like playing Monopoly – you need to be on every square on the Board to win – same with off of Amazon selling
  • This means you show up in all Google spaces via Jet, Walmart, etc. via their Google PLAs

Lots of SEO work

  • Own website lots of PLAs and SEO work
  • Lot of content and backlinks
  • Links and Rich content are key
  • Vacuum parts hard for SEO and engaging content
  • Software SEO v’s Local SEO v’s eCommerce SEO for vacuums – very different approaches
  • eCommerce – Chad’s niche is super hard – nobody cares about it
  • Small DIY blogs and really compelling content – aim is to get a backlink
  • Use guest posts, give discounts to their community for the products

Managing everything

  • Had one person – 30 people in the eCommerce Business – and was a small town to find skills in
  • Going remote opened up skills to tackle the business weaknesses
  • Finding people and using Basecamp made a huge difference
  • Remote culture is built through Basecamp
  • Skubana side – everyone is in New York and 28 people

Time Management

  • Very efficient in time management
  • Chad’s wife is an entrepreneur and runs a Yoga firm
  • Work is integrated into their lives – holiday, etc it’s just part of life
  • Monday is listening day – standup meetings
  • Structure the day with Sun and Moon
  • Morning is best for energy and email is not a good use of energy in the morning
  • Have Lunch and coffee
  • Late afternoon when things die down can go to email and clear it (VAs draft emails through the day in his Inbox ready for review)
  • Wall Street taught how to work very long hours without moving 7am to 2am for 3 years
  • Having Analytics to analyse business and run a P&L

Other Marketplace

  • Why would you go off of Amazon – only the strongest survive on Amazon
  • A Gateway drug – easy to get started and super hard to ever leave
  • Would you invest in a stock with one customer – too much risk, need to diversify your risk level
  • Chad has been suspended on Amazon five times – and it hurt
  • After tasting the bottom of the barrel, Chad diversified through marketplaces and shopping carts
  • How do you manage it – you need a system in place to run and automate your business
  • The system you pick determines how much success you can get in your business
  • Skubana is multi-channel and covers off of Amazon
  • McDonalds in UK versus New Jersey will be systemised nad consistent across the World
  • Automate the channels as you expand with 1 click integrations
  • Do research on where your customers that buy are spending their time
  • Chad’s customers spend their time on Walmart,  eBay, Google, Amazon and Home Depot
  • Smart luggage would target travellers on Facebook and Instagram or Twitter luggage complainers – catch eyeballs and wallet share of those
  • How do you win if you’re doing the same as everyone else – there’s no competitive advantage

Life Time Value of Customer

  • Think about the LTV – Life Time Value of the client
  • How will you dip into their wallet again for a 2buy or 3buy
  • Cost of customer acquisition is key
  • Think about long term wealth versus short term income
  • Go to the dark corners where nobody else goes – be contrary

Going off of Amazon

  • Surround yourself in this circle of Amazon – Understand that there is so much life outside of Amazon
  • Loads of Huge brands outside of Amazon selling thousands and thousands of products
  • If you ‘re going to sell off of Amazon, be prepared and have the budget to build that traffic
  • Off of Amazon conversion rates are 1% not 15% – it takes time to build the traffic to get that 1 in 100 off of Amazon
  • Focus on an innovative product that solves a problem – the only way to go
  • Hit the ground running and make mistakes – learn from the school of life
  • You’re not growing unless you’re failing – you learn from people’s failures as well as your own


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