Klaidas Siuipys
Let’s talk Amazon Strategy | $50M+ in Amazon Sales Growth | Founder @ AMZ bees | Amazon Expert for 7+ Years
We are the team you will hire to grow your business to its full potential.
But words are nothing without actions.
In the following paragraphs, you will know how we at AMZ Bees scaled а 1-product Private Label brand from $0.5M to $30M yearly revenue on Amazon at a 38-40% profit margin.
Loyal to our mission to bring more m(h)oney for our clients, we are proud to be a part of this incredible journey.
Before we dive deep into the case study, discussing some crucial characteristics of a potentially successful product on Amazon is essential (as our client’s product does have).
After the educational intro, it’s time to jump into the REAL brand transformation!
Building Foundations in 2020
We started working on this account on June 1st, 2020. What we initially saw was the brand’s enormous potential. Unfortunately, it was heavily under-optimized.
Regardless of the bad account health, the product was good enough to gain $50K in monthly revenue.
Every new journey starts with the first step.
We began with unblocking a few listings and connecting everything under one variation.
This allowed us to focus on the parent rather than the multiple-child ASINs.
As a result, we had a shot at reaching best-sellers in the subcategory.
Knowing the importance of quality optimization, we dove deep into the back-end SEO (search terms, filters, browse node correction, and whatnot) and started slowly testing the waters with PPC.
Our strategy was to start with a few dozen 2nd level PPC campaigns, which helped us 2x our sales in the first month to $112K.
During the first three months, we upgraded our infographics and created decent A+ content and Storefront.
We also upgraded our listing copies with better SEO and started posting Amazon posts daily.
In July and August, we built and fortified our PPC structure (2nd level optimization).
After we had good Sponsored Products campaign foundations, we started growing Sponsored Video, Sponsored Brands, and Sponsored Display. Our ad spending increased, but this only helped us gather more keywords in preparation for Q4.
As our sales increased, we started facing stock-outs.
Thankfully, our partners have seen the potential and started ramping up production. In September, we had two 15 and 30-day product suspensions because of “dangerous materials”.
Amazon has removed one of the best-selling child ASINs in Japan (at that time, we were only selling in the USA), and the listing has disappeared worldwide. We didn’t even have the option to appeal.
This issue has cost us $1,500/day in lost profit.
We faced one more problem, but it was much easier to solve. Amazon required us to do a few additional safety tests and provide certifications.
Our team solved both issues before the beginning of Q4.
Q4 of 2020 was incredibly challenging but also rewarding. We managed to get the Best Seller badge in our sub-category and move into the top 100 of our main category.
This resulted from our well-built structure for all advertising types with constant everyday testing, improved listing quality, and relatively OK stock limits. They weren’t enough, though.
By the end of November 2020, we were 70% out of stock. Luckily our manufacturer has offered an excellent option to solve this issue. We managed to ship a 4-unit variation from China. We were charging $15 in additional shipping charges when the product cost $80-85.
People still bought out our total capacity every single day. Because we didn’t have a proper FBM shipping structure, all orders had to be filled manually. Amazon was labeling our products which was also expensive at scale.
In December 2020, we realized we reached the ceiling for the 2nd level optimization. After Christmas, we began adjusting our PPC structure with 3rd-level campaigns.
We separated the keyword families into their own match types and campaigns.
On the last day of the year, we were featured on national TV. This move helped us sell absolutely everything we had in FBA and FBM.
We sold $100K, and it was our biggest day yet.
Customers who bought our product on that day, needed to wait 1-2 weeks before Amazon or we delivered it.
We finished 2020 out of stock but with outstanding achievements after only 6 months of working on the account.
2021 – Growth phase
The beginning of 2021 was very slow – we didn’t have any stock after a great Q4, and this problem persisted more or less until the end of August. We were about 90% in stock only in September 2021.
It was time for planning and incorporating new strategies. We were dedicated to this process during Q1 of 2021.
We did a full update for the listing copy, infographics, and A+ content in January. This front-end update looked much better than the first one, and it converted better as well.
In February 2021, we began testing lighting deals. They worked well for us, and I knew that we would greatly benefit from them in Q4.
We also partnered up with TopRated for 2 daily lives on the Amazon Live platform, bringing us more brand awareness.
In June 2021, we had our first ”real” Prime Day. We wanted to test it without any ongoing deals, just with a standard 4-hour lightning deal. It was relatively a disappointment for us. We learned that we MUST have a Prime Exclusive Discount going during these types of holidays in our category. Still, we had a solid $86k day.
To sum up the first two quarters of 2021 – we were optimizing, optimizing, and optimizing.
In Q3, 2021 we went all in for the 4th level campaigns and structure and joined the Launchpad program. This was the real game-changer.
What does 4th level of PPC optimization look like?
In this advertising structure, every target has its own campaign. You optimize individual targets with budgets, placements, and bidding strategy.
The Launchpad program enabled us to Premium A+ content and SAS core manager that would later improve our stock limits for the estimated $6M Q4 (boy, were we wrong again…).
It took us about two months to prepare stunning Premium A+ content that converted about 15% better than the old one. We joined all available Launchpad promotional programs.
In July 2021, we started using DSP advertising. Our budgets were 80-90% dedicated to retargeting since this was the lowest-hanging fruit in 2021.
DSP helped us bring in an additional $1,5M in sales at 10% ACoS.
We started with a $10k budget/month and kept increasing it every month until December. This part definitely paid off and helped us with visibility and brand recognition.
In August 2021, fully upgraded to the 4th optimization level, and our performance was noticeable after the first month. Our ACoS has quickly shrunk from 15-20% to our new normal (10-12% ACoS).
We reached peak optimization WHILE not pushing due to stock issues. We were never entirely in stock.
We were sure we could have done more, but there was no point. We knew we would go out of stock either way. Since there’s no point in wasting money, we improved our profitability.
During Q3, we introduced a few new designs and created a two-level variation, including purchasing multiple units of the same design. This action helped us bring in an additional $1,2M in sales in 2021.
Unfortunately, we only sent 20,000 units and ran out of stock (most SKUs) on December 13th.
2021 Q4 was the most intense quarter for this brand so far. Every week, we would hit new highs.
We had lightning deals every week, and we were testing every detail, from child ASINs selected for the deal, quantities dedicated for it, and sales built up with PPC and DSP before the deal for more exposure and Deals page ranking.
We would reach the first deals page almost every time.
Our advertising structure was running at the best performance ever, and we were creating dozens of new campaigns every day.
We had a total of 7541 campaigns running at the same time. This required at least 4-6 hours of daily attention to keep things running smoothly.
This structure is highly volatile, but it allowed us to move very swiftly, testing and killing keywords continuously.
Unfortunately, stock problems weren’t entirely fixed.
We’re thankful to our partners (the client) responsible for keeping us in stock, flying in 20-30k unit shipments every week.
We were estimating $10M/year, but we reached our year goal in October thanks to our fully utilized strategies for this revenue level.
A lot of the stock arrived on time for 2021 Black Friday. During the T5, after lessons learned during the “Prime day”, we combined lightning deals and Prime-exclusive discounts, thus hitting our new all-time high day – $675k in sales.
We generated an additional $10M in the last two months of the year. It might go without saying – we definitely ran out of stock. Even with 60 people running two assembly lines and working 24/7, everything we manufactured in 2021 wasn’t enough to cover our sales.
December was relatively quiet. We stopped running lighting deals. Amazon has started selling some of our products at 20% lower prices, thus taking away our Buy box or forcing us to lower the price. After selling all the inventory they had for 2 of our ASINs, they took our Buy box away and forced us to lower the price. We didn’t. This problem goes away after some time, but it is a struggle every now and then.
On December 13th, we appeared on national TV again and sold 95% of our remaining stock. During this day we generated $ 582 148 in total sales with a 44.38% profit margin. The rest of December was about slowing our campaigns as much as possible because we didn’t want to waste ad dollars to send traffic to products that could be delivered only on January 5-10, 2022.
We received a couple of 20k unit shipments by the end of December that helped us prepare for January 2022.
This is what the entire 2021 looked like.
2022 was the year of limitations.
In January 2022, we did almost $1M in sales being generally out of stock.
We were shown on the 1st page of Amazon Deals, which generated over $430K in sales for the brand this is 15x more than normal our daily sales.
.
In Q4 2022, we noticed a big change in customers’ behavior. Amazon introduced the 2nd Prime Day for the year (October 2022). This news was terrible for us. Here’s why:
Christmas shopping usually starts in September because customers are insecure about waiting 2.5 months until Black Friday to buy their presents at a lower price.
What if the items are out of stock?
But in 2022, that didn’t happen. This time, buyers knew there was no need to wait 2.5 months until Black Friday. They could shop 1.5 months prior to the 2nd Prime Day.
Even if they were not pleased with the Prime Day deals, there was only 1 more month until Black Friday.
This is why our Christmas sales began after Black Friday.
In conclusion, even after so many limitations and technical issues (we had a full-time person working only on the technical side of the account), 2022 was the best year for us.
We’ve reached each TOP that Amazon could offer us.
For the majority of the Q4, we were the best-seller in our main category. Our advertising strategy was maxed out and it seemed like the account was performing at maximum efficiency with very little additional room for growth.
That’s why from 2023 we began slowly introducing new products to expand over the $ 30M / year sales.
How is 2023 performing so far?
As I mentioned a few sentences above, we reached the maximum for the brand with what we’ve got.
We 9x our sales running Best Deals instead of PEDs for the Prime Day period (July 11-12th).
These are the results of 2023 so far:
Stay tuned to know how the year will end for the brand and how new products will perform.
If you want to be our next Queen Bee and grow your brand to its fullest potential, just reach out through this link:
AMZ Bees is an e-commerce agency that grows and manages brands on Amazon with advanced PPC strategy, listing conversion optimisation and problem solving.
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