Case Study #1: Growing A Business on Both Vendor And Seller Central

 

Executive Summary

A home goods company came to us as an established company with multiple brands that have had success on many retail channels such as Walmart, Walmart.com, Target, and eBay. They sold product to Amazon as a vendor for five years prior to meeting with Velocity Sellers. They had several staple brands in the home goods category and while they had sales on Amazon.com, the total sales volume was not reflective of the reach and capabilities of Amazon’s Online Marketplace. Velocity Sellers came up with a strategy to increase sales while implementing advanced tools and processes that benefit both vendors and sellers on Amazon.

The Challenge

As a vendor to Amazon (through the Amazon Vendor Central program,) they relied on Amazon’s marketing to build their listings and manage their marketing. They had limited communication with Amazon and no plan to grow sales. Their listings were set up with minimal optimization and they were losing out to their competitors, even having lower prices for the same product category.

The Goals

The goals were to:

  • Increase sales for their existing products
  • Beat their competition,
  • Increase their marketing on Amazon
  • Start their own 3rd Party presence selling direct to consumer through Seller Central.
  • Clean up their catalog
  • Optimize their listings
  • Establish successful advertising campaigns
  • Increase the number of 5-star reviews

How Velocity Sellers Helped

When Velocity Sellers joined the home goods company’s team, we made several initial improvements to their listings on Vendor Central to optimize for search and conversions, took over the Sponsored Ads and Promotions, and started up their 3rd Party Amazon store (Seller Central) to be used with FBA (Fulfilment by Amazon.) Velocity Sellers addressed several issues first. These improvements included: (ads report)

  • Removing Unauthorized Sellers
    Actual Results

    Actual Results

  • Adding enhanced images
  • Creating strategic Bundles
  • Improving product content
    • Improving keyword relevance across their line of products
    • Updating titles for SEO
    • Updating Descriptions to better describe the product and for SEO
    • Utilizing A+ content
  • Implementing Lighting deals
  • Reducing Out of Stock Rate
  • Adding new products to 3rd party store

Results, Return on Investment and Future Plans

The Numbers:  

  • A 80% increase in revenue from Sponsored products advertising within 2 months
  • A 20% increase in organic conversions within 4 months.
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    Actual Results

  • Gross margins of 35% with Seller Central
  • Created sustainable and profitable advertising campaigns averaging 10% of retail price.
  • Increased sales of ~40% over the first 6 months

Other achievements

  • Removal of unauthorized 3rd party competitors
  • Streamlined customer service
  • Gained valuable customer and category data
  • More accurate inventory forecasting and projections
  • Increased product count by 20%
  • Cleaned up and consolidated listings for better brand presence and customer experience

At the time of this case study, April 2017, we are trending to record a 50% increase in sales with overall increased margins. We are now managing the next phase which is the entrance into other Amazon markets.

Case Study #2: Taking a Seller to the Next Level

Executive summary

An Established Sporting Goods company which has had success on its online store as well as a strong distribution network came to us to establish a stronger presence on Amazon. They had the best products in the market and the only one in their industry that was made in the USA. While their business did in excess of $10 million a year, their Amazon business was less than $200,000 annually. They had hundreds of listings with little organization or marketing strategy.

The Challenges

How do we convey the higher quality of the product? How do we get their items to the first page of the search results? How do they manage a catalogue of hundred of items on Amazon? How do they determine the products to focus on and invest marketing dollars? How do they keep their margins when Amazon is considered a price-driven market and their product is a premium version to their competitors’?  How do they manage their inventory and shipping on the merchant-fulfilled network (MFN) and Fulfilled by Amazon (FBA) at the same time?

The Goals (after strategizing with client)

We targeted a sales goal of $350,000 for the first year with a gross margin of 30% after advertising expenses. We wanted to maintain MAP pricing policy and ideally grow the business without impacting sales from their own website.

How Velocity Sellers Helped

We looked at the business holistically and considered the what was already working with their Amazon store. We learned more about their customer and started optimizing and marketing their best performing items to get them to higher search ranks. Then we looked at opportunities for under-performing items with high potential.

We focused on all the aspects of Amazon that were operating inefficiently for their business and created a structure around listings optimization, marketing, brand presence and fulfillment practices.

In managing their Seller Central business we:

  • Optimized all existing listings for organic search (starting with highest volume items)
    • Improving keyword relevance across their line of products
    • Updating titles for SEO
    • Utilizing enhanced content
    • Updated content for conversions
  • Wrote listings for their new catalog of products
  • Removed Unauthorized Sellers
  • Added enhanced images
  • Creating strategic bundles
  • Product development research (new categories)
  • Managed fulfillment
  • Converted seller from Merchant Fulfilled (MFN) to FBA
    • This secured the prime badge for their listings
  • Reduced out-of-stock rate
  • Created profitability reports

Results, Return on Investment and Future Plans

The Numbers:  at_ads

  • A 45% increase in revenue from Sponsored products advertising within 2 months
  • A 20% increase in organic conversions within 4 months.
  • Created sustainable and profitable advertising campaigns with costs averaging 13% of retail price. (This number decreases month after month)
  • Increased sales ~40% over the first 6 months

Other achievements

  • Gained valuable customer and category data
  • More accurate inventory forecasting and projections
  • Increased product count by 5%
  • Cleaned up and consolidated listings for better brand presence and customer experience

We are currently developing strategies for new products specifically for the Amazon channel based on customer demand, entering into new markets, including Europe, and improving margins.


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