Category: MyFBAPrep Interviews

Monitor Your Return Reports: A Chat With Lesley Hensell of Riverbend Consulting

In this video, Rachel Go chats with Lesley Hensell, Co-Founder of Riverbend Consulting. Rachel and Lesley discuss her background, what brought her to start Riverbend Consulting, how she became known as “the suspension lady,” her advice for merchants to protect their accounts, and much more.

Transcript below.

Lesley’s background

Rachel Andrea Go: To kick things off, would you mind sharing a little bit about your background and how it led to where you are today?

Lesley Hensell: Sure thing. So, I’m co-founder of Riverbend Consulting, also known as the Suspension Lady by a lot of people out there. But I actually got my start selling on Amazon way back in 2010. So, I was one of those “Mommy-preneurs” that we all know now that have grown through Amazon over the years. I had a special needs kid who was not doing well in school, and we decided to homeschool them. And at the time, I was an old-school consultant and I could not maintain that schedule of doing client calls all day long and homeschool a special needs kid, and I had a toddler, too, so that wasn’t gonna work. So, I found Amazon, started selling nights and weekends when my husband was home, and did that for many, many years. Then, I started meeting people at conferences who were having challenges on Amazon, so I started using that old-school consulting background to help them out when they would get suspended and other challenges with their accounts.

So, now we’ve grown Riverbend to more than 85 employees and we help thousands of clients all the way from the biggest sellers on Amazon all the way down to mom and pops like me because I still have a small seller account that my family runs now to pay college tuition for that special needs kid.

Rachel Andrea Go: Can you tell me more about that trigger event that led you to start Riverbend Consulting?

Lesley Hensell: Absolutely. I had actually, on my own, been working on suspensions for sellers. So, it was all word of mouth; people would get referred to me, and I would help them write their plan of action and get reinstated. And one of the clients that was referred to me was this guy from New York named Joe Salta, and I got him reinstated really quickly, and he had already been using someone else [and] been hitting a wall. And a couple weeks later, he called me up and said, “You know, I’ve got this really strong sales background, and you know how to do this suspension thing, so we should do this together.” So we did. So now, we’re like the “Mutt and Jeff” of the suspension world. So, if you ever see Joe, he’s, like, a super tall, skinny guy, he’s got the Brooklyn accent, he’s really young, and then you’ve got me: I’m not so young, I’m a lot shorter, and I’m from Texas. So, we’re kind of an odd couple but we’ve done really well and we have a great time helping Amazon sellers.

Account & listing suspensions (and how to avoid them)

Rachel Andrea Go: What are some common reasons that accounts get suspended?

Lesley Hensell: So, that’s an interesting question because it kind of cycles depending on what Amazon is focused on at that particular moment in time. Right now, we’re seeing something kind of wild because, back when suspensions first started really picking up around 2012, 2013, everything was for inauthentic. And then, for many years—the past many years, that’s backed off, and you would get inauthentic suspensions for ASINs, but not for a whole account. Well, golly gee, guess what they’re doing now? They’re taking down entire accounts for inauthentic. That’s been happening more. 

Also, there are so many for linked accounts. These are very frustrating for sellers because it’s usually one of two things. I mean, there are bad actors who have multiple accounts for bad guy reasons, but those aren’t my clients and the people who need help. It’s usually either you actually are connected to another account that got suspended, but it was from 10 years ago when you were in college, or it was a roommate you had at one point in time who screwed up and it wasn’t you — those are really frustrating — or you can’t figure out who it is. They’ll even tell you the name of the account. You’re like, “I’ve never heard of that,” and so proving a negative is always really difficult. Those are frustrating, but they usually do get solved.

Rachel Andrea Go: Do you think that this new emergence has anything to do with AI and how people are posting using AI?

Lesley Hensell: That’s a great question. Actually, I think where that’s going to have more impact is on listing suspensions — things that are related to how you’re creating your listing detail pages, because AI doesn’t respect things like the rules about variations. And so I think that is going to be problematic for some sellers who are over-dependent on AI to create their listing detail page. I also think AI is going to be used by bad guys to attack sellers. So, black cats are going to use AI to insert words into reviews and store feedback to try and get their competitors taken down.

Rachel Andrea Go: So, how are—what are two to three steps that you recommend merchants take to avoid suspensions or avoid being attacked by those “bad actors”?

Lesley Hensell: So, the first one is to really pay attention to returns reports. I know that sounds so basic, but you would be surprised at even large sellers that I say, “Hey, have you pulled your returns report?” And they’re like, “What returns report?” So, they don’t even realize it’s in there.

There’s a great FBA returns report you can download, and you can sort it by the reason for the return, and you can find out—I know, I know that a lot of buyers lie, I get it, or they don’t understand the product or they made a mistake, but there’s also a lot of buyers who buy your product and can tell you straight up what you’ve done wrong. So, like, I had a client who—they were getting complaints over and over for this particular item of clothing, and when you looked at the returns report, almost every complaint was, “It runs too small.” Well, that’s not some conspiracy — it runs too small! And so you can learn so much from the returns report to improve your ASINs, because, remember, every time you have a return, it costs you so much money and it impacts your profitability. So that’s number one.

And number two is, actually, advice that goes against the advice that I used to give and it’s because of how Amazon has changed their enforcement, which is you really have to appeal every ASIN that is suspended now. It used to [be] you could just say, “Whatevs, I’m not gonna sell that anymore. I’m ignoring that.” Or you could click the button that says “Acknowledge.” You do not want to click “Acknowledge,” and I’m going to tell you why, and this is new and it’s really bad. We’ve had sellers gated out of selling brands because they either didn’t appeal or they clicked “Acknowledge” too many times. So Amazon is saying “Oh, you’re not trustworthy on this brand. You had three ASIN suspensions for this brand.” And when they gate you out, it is so hard to get it back. It’s not like a regular appeal; we’re going outside of all of the usual channels, and they are really difficult. 

We’re eventually getting them solved most of the time, but not all the time, and it sometimes is taking three, four, five months. So, you really do have to appeal all of the ASINs, ignore if you’re still in the green on that account health, because, you know—I had one seller who sells a beauty brand that’s kind of a nicer brand. They’ve been selling it 10 years. They had three ASINs suspended over the summer, didn’t appeal, and then they got gated out. So, we had to first appeal the three ASINs and we got all of those resolved, Amazon accepted the appeals and invoices — we’re still working to get the brand ungated again.

Be explicit to prevent returns

Rachel Andrea Go: You mentioned returns. I’m curious: Do you have any tips to avoid returns or prevent returns in the first place?

Lesley Hensell: Oh, another great question. So, this is where I like to use my “phone a friend,” especially for small and mid-sized sellers. You know how, when you’re really good at your business and you have conversations, you’re talking to yourself or you’re talking to your company, and if you have that same conversation with someone outside the company, they’d be like, “She’s speaking a foreign language. I don’t know what she’s talking about”? A lot of times, that happens when you create listing detail pages and even when you create product packaging. So, a whole lot of returns are because the customer didn’t really understand what they were going to get. So, if you can use someone outside of your circle — not your brand manager, not your agency — and have them look at the listing detail page, look at the product itself, and say, “Yeah, I would feel like that’s what I’m getting,” that’s really important. 

Also, on product packaging, we all know that Amazon FBA returns grading is really bad, it just is. So, when they get an item back that was returned, they’ll put it in “unsellable: when it’s sellable, and they’ll put it in “sellable” when it’s unsellable. [It’s] really important to put seals on the packaging if it’s any kind of package you can put seals. So, if it’s in a box, you can put a sticker on it that says, “If item is opened, it is not new.” You’re not saying that for the buyer, you’re saying that to the people at Amazon FBA.

Handling Amazon & Walmart account appeals

Rachel Andrea Go: What is the most complex, interesting, or funny account reinstatement story that you’ve done?

Lesley Hensell: Okay, so, the funniest is really a head-scratcher because this client never should have been reinstated, in my opinion. I had a client who was selling in the Sports and Outdoors category and he was dropshipping, but he was doing the dropshipping you’re allowed to do where you have a distributor who—they are dropshipping with your name on the item. It looks like it’s coming from you, right? So, he would get these sports and outdoors catalogs from these large sports distributors, and he was just uploading the entire catalog to Amazon instead of going through and vetting the listings. So, he was taken down because he had listed hand grenades. His supplier was also a supplier to the federal government. 

And so, when he uploaded the catalog, it was full of gun parts, it had mines and hand grenades, it had things I had never heard of, weapons I had never heard of, and knife parts — all the things. And, shockingly, Amazon reinstated him on our first appeal, which I will never understand. They had to do a lot of work scrubbing to get all of that mess that he threw in the catalog out, and then, obviously, he scrubbed the catalog a little better in the future before trying to sell federally restricted products.

Rachel Andrea Go: I saw on your website you also do Walmart appeals. So I found that really interesting. Are there any big differences between how Amazon appeals work versus Walmart appeals?

Lesley Hensell: You would think there would be — until I tell you Walmart hired people who work at Amazon to build out their enforcement division. So, if you ever go through enforcement on Amazon, whether it is appeals or ASIN level — which it, at Walmart, is the item level instead of ASIN level — you’ll find that, aside from just different terms like that, it’s really very, very similar. And even a lot of the reasons for suspension: They have the same problems with dropshipping that Amazon does. 

They are not—they have not gone through the big identity verification stuff because they do verify your identity when you onboard, but they don’t circle back to that the way Amazon sometimes does. But otherwise, so much of it is the same inauthentic complaints, condition complaints, late orders, dropship violations, it’s—oh, and related accounts — it’s really all the same thing.

Rachel Andrea Go: If you ever write to them, do you ever hear back from Walmart saying, like, “Oh, I remember you from when you were, you know, when I was at Amazon”?

Lesley Hensell: Oh my goodness, they’re—okay, so, first, I have to tell you, they’re actually much more responsive than Amazon at the seller performance level. But when I write escalations for clients, I write them in the voice of the client and the client actually submits them. But you know what is funny? I have a lot of ex-Amazon employees on staff at Riverbend and some of them do remember cases that I worked on in the past. Sometimes when we write escalations, we try to make them entertaining or amusing or we use funny subject lines, we use big drama; sometimes we use what we call “bad words,” which are things like, “You’re breaking the law.” We’re very careful about saying that, but sometimes they are. So, I have had a couple of employees who recognized sample appeals in our training process because they evaluated them when they were at Amazon. That was kind of wild that it was that memorable.

Introducing Amazon selling through The Amazon Incubator

Rachel Andrea Go: Honestly, I’m not surprised. By the way, congratulations on your new book! Can you tell me a little bit more about The Amazon Incubator?

Lesley Hensell: Thank you so much. I am super excited. I am most excited because it wasn’t even my idea to do this. I spoke at a conference, and after that, I was approached by the publisher because they had wanted to do a book about how to sell on Amazon for a long time and wanted someone in the industry who had a voice and, honestly, they had the same feeling I do. 

Okay, you know how you go out on YouTube and you search for how to sell on Amazon and you get all the “Lamborghini guys,” is what I call them, that they’re like, “Buy my course for thousands of dollars and you’re gonna have this great Lamborghini!” And then they show their Lamborghini that’s rented in front of their mansion that’s rented with a girl draped across it — she’s probably rented — and they’re trying to get you to buy into their system and it’s only 5,000, no, 12,000, with the coaching, twenty-five thousand dollars! 

And the publisher had the same feeling I did, which is, “Ew, that’s kind of gross.” And, “Is there a better, nicer way to introduce people to Amazon or to help existing brands on Amazon — you know, [a] twofer — in a book?” So, I wrote The Amazon Incubator, and it is very much about helping sellers where they are. So, the goal that it should help a seller reach is the goal the seller wants. So, it really starts from the beginning of, what is your goal? What kind of seller do you want to be on Amazon? How do you pick the products you want? How do you choose your fulfillment method? So, it’s a—it covers all the basics, all the different categories of how to sell right up to, how do you outsource? How do you pick an outsource provider? How do you hire a VA? And the goal is, instead of paying $5,000, it’s a 25-dollar investment.

And I think it can help a lot of people decide, “Is this how I want to have a side hustle? Is this how I want to expand my brand? Is it something I can do?” I still think — and the reason I call it “the Amazon Incubator” — Amazon is the most successful business incubator in the history of the world. There has been no other platform or method that has launched so many small businesses, so many millionaires, so many people making a great living — it truly still is a great opportunity. And I think that, by providing this as kind of a blueprint or a guidebook, it’ll simplify it for a lot of folks. And also, you know, I really envision—there’s a lot of entrepreneurs out here who should give this book to their kid. You know, your kid wants to make money, they want a side hustle — give them the tool, make it easy for them to understand and to get started.

Rachel Andrea Go: You mentioned what kind of seller that, you know, different people might want to be on Amazon. Can you tell us a little bit more about the different kinds of sellers that you mean? Is it, like, dropshipping, or is it, like, a lifestyle business versus all-in?

Lesley Hensell: So, a lot of it is about mindset. So, are you the side hustler that you really never want to grow your own personal brand? You just want that extra $4,000 a month net that you need to pay your bills or save for college or go on vacation or whatever it is. That’s one example.

Another is the brand impresario. So, these are the guys who are building their own private label brand, and a lot of them will then build another brand and another brand. And a lot of the decisions that flow from which of these archetypes you are — these “seller avatars,” if you will — it impacts the decisions that you make about how much you outsource and how you fulfill products. So, I think I have seven different avatars that, in chapter 2 — it’s my favorite chapter of the book — I describe each of these avatars. And then, as you work through the book, you can see how—“Well, I’m kind of a combination between the guy who wants the lifestyle thing and the brand-building thing,” and then it helps you make the decisions of how you build out that business.

Rachel Andrea Go: That sounds super interesting. I feel like everyone who even has already sold on Amazon for many years would benefit from reading that just because there are so many changes as well that people who have already established businesses on Amazon may not know about that they can learn about from the book.

Lesley Hensell: Well, and let’s face it: Amazon is changing all the time. And so a lot of people who launched on Amazon kind of did the “seat of the pants” thing, right? So, you just bought some product and list it and go! And that’s great because you get the cash flow moving, which gives you the freedom to do some more things. But is it time to back up and really think through, “What are my goals? Am I really doing this in a way I’m gonna reach those goals? What are some alternatives I should be thinking about?” So, I find that in any venture that I have — whether it’s business, personal, charitable — it’s good to have that time where you kind of back up to the basics. So, I think it could be a good tool for that, yes.

Turbulent times in eCommerce

Rachel Andrea Go: Thinking back on 2023, was there anything that happened last year that was particularly memorable or [that] you think is going to have really long-lasting impacts on eCommerce?

Lesley Hensell: Wow, such a great question. So, on the macro side, the changes with all of the aggregators — I think we are all going to be seeing some shake-out vibes from that for some time. I would caution people, though, who put too much weight on that — I think there are people out there in the media who are trying to make it, like, “Ecommerce isn’t any good,” or “Selling on Amazon isn’t any good because these large aggregators are failing.”

But that’s not necessarily true, because you have to remember: The average eCommerce seller may have a little bit of debt, but these guys were super highly leveraged. So, if you saw that an aggregator took out—got 50 million dollars in equity investment, what you need to know is, they then went and got 50 million dollars in debt, so they had an equal amount of debt and equity. Why does that matter? Interest rates have been going up for two years; their business plan did not include, “What if my interest rate quadruples?” 

So, just understand, yes, were there some fundamental problems with how they set up their business? Has eCommerce been more challenging the last two years? Yes. But there is another layer to that story that is all about, “I can’t service my debt and afford all these people.” So, I just wanted to throw that out there because I think that it is a cautionary tale but maybe for the wrong reasons sometimes. 

And then on a micro level on Amazon, they have had a tremendous number of layoffs over the last year and they are going to keep laying off people and they’re also not replacing people — which is essentially a layoff, right? That you just don’t hear about? So, the way that impacts sellers is that the enforcement is really bad and seller support is getting worse. And I know, you know, when I say that most people roll their eyes and say, “It can’t get worse!” It can. I’ve seen it before; several years ago, when everything was understaffed there, it was actually worse. It goes through these cycles: Things will turn and grow, they’ll hire some more people, they’ll figure out they can’t muddle through like this. But for now, it’s really bad. And so what that means is, if you’re an inexperienced seller or if you’re running up against an issue that you don’t understand, you’re gonna have to find an expert, a friend, an agency, a forum, a seller group, a mastermind. You’re gonna have to find someone who can walk you through some things because you’re not gonna get the help from Amazon. You’re gonna have to find the answers yourself and then persuade Amazon to help you make changes.

Play it safe and outsource your headaches

Rachel Andrea Go: What is your advice for merchants coming into 2024?

Lesley Hensell: Oh goodness, so…to me, this is a year to be a little bit conservative. And that is not an answer anyone ever wants to hear, but there’s some—you know, inflation is still happening. There are some shipping issues right now, which makes all the costs go up.

And there’s, you know, political drama because it’s an election year. So, I don’t think it’s necessarily a year to be super crazy aggressive if you’ve already got an established business. Now, that doesn’t mean you don’t invest in new things and try new things, but it’s all got to be based on data and testing. It can’t just be like 15 years ago when you’d just throw products up there and they sell; everything needs to be based on data and testing. So, you want to launch a new product? Get 5,000 units instead of the 15 [thousand] you were gonna order. Get them on Amazon. Test. Try different A/B tests on everything — on your ads, on your pages, on everything — and really improve before you go all in. And that’s my really boring, unsatisfying advice.

Rachel Andrea Go: What are some of the most beneficial things to give to a VA for them to do?

Lesley Hensell: So, anything that you can outsource is great to outsource. And the most important things to outsource are the things that make you mad or unhappy. So, give you an example: Everyone knows that doing customer service messaging can make you mad and unhappy. I know that’s a very basic thing, but when you have people lie to your face about your products, complain about the condition they arrived [in], or that they didn’t arrive when you have the tracking in the picture, that will make you very mad and very unhappy. And as an entrepreneur, you really need to be focused on the things that will make you money, and being mad about that customer isn’t going to make you money. So, the number one thing to outsource are things like that that disrupt your flow, disrupt your emotions, and create problems for you.

But then, after that, you can write an SOP for a VA on almost anything — including that returns report I mentioned earlier. They can calculate your return rate for your products. They can look and tell you which ones are the most problematic that you should look at, serve up that data to you, and then you do the decision-making. So, I’m a huge fan of, “Reimbursements have to be outsourced to a VA or an agency.” They have to; they’re complex, time-consuming, and frustrating. Customer service messaging is a big one. You can use them for sourcing if you are looking through catalogs because you source wholesale, they’re great for that as well. So, those would be my top three.

Brand = Consistency: A Chat With James Thomson of Equity Value Advisors

In this video, Rachel Go chats with James Thomson, Managing Partner of Equity Value Advisors, among other roles. Rachel and James discuss his background, early days of FBA, investing, and advice for brands.

Transcript below.

James’ background

Rachel Andrea Go: Thank you, James, for joining today. For my first question, I wanted to know if you could share a little bit about your background and how it led to where you are today.

James Thomson: Thank you, Rachel, for having me today. I have had the good fortune of being able to work at Amazon back in 2007 through 2013, when the marketplace was really starting to pick up and the FBA program was still in its nascent stages. I got to work as Amazon’s first FBA account manager trying to sell FBA into brands back when the discussion was more around, “I have a bigger warehouse than you do, so why don’t you use our warehouse?”

One of the fun things I got to do at Amazon was to take sellers on tours of some of the facilities and show them the vastness of the network that we had, and that convinced a number of sellers that, even if they had a decent-sized warehouse of their own, the fact that Amazon had a network of warehouses across the country and could support Prime — that was a major differentiator, and brands got excited.

After I worked at Amazon for a number of years on the marketplace side, but both marketplace recruiting as well as FBA recruiting, I left Amazon and started an agency with my business partner, a company called Buy Box Experts, which became a large agency for supporting both 3P and 1P brands. And I also had the opportunity to found the Prosper Show, which is an educational conference that Amazon sellers today still frequent.

I’m long gone from both Buy Box Experts and Prosper Show, having sold both of those businesses. But nonetheless, I’m still very much entrenched in the eCommerce space, helping brands think through, how do you build a strategy to either launch on eCommerce, or how do you think—help them think about what it takes to migrate from being not only a brick-and-mortar brand but a brick-and-mortar brand that also has a cohesive eCommerce strategy. So, that’s what I do today, and I’m very fortunate to have accidentally landed in eCommerce, because it turns out—I hear it’s going to be a growth business.

Rachel Andrea Go: You were really on the ground floor of FBA right at its Inception. Can you comment on how FBA has grown as a program?

James Thomson: Well, back in 2009, 2008, FBA was a money loser for Amazon. Amazon was trying to figure out, “How do we get sellers—third-party sellers excited about putting their products into the warehouse?” This was before everybody realized that, “Oh, if you’re in FBA, you’re Prime eligible. Oh, if you’re Prime eligible, your products are gonna have a really good organic search score. Oh, those kinds of things actually matter.”

So, it turns out it’s not really about whether Amazon can shift your product faster than somebody else or cheaper than somebody else; it’s really about how do you play the Amazon game effectively. And, certainly, the FBA program—by the time we got to 2011 or so, brands were starting to realize whether they had the capability to ship products themselves or not. It probably made sense for them to look seriously at using FBA, at least for the Amazon portion of their business.

Brands need an Amazon channel strategy

Rachel Andrea Go: What are some key ways businesses should choose their acquisition channels?

James Thomson: So, I have a little bit of a biased response here, because most of the companies I’ve worked with in the last 16 years decided that Amazon was a good place to go because it was a big place with lots of customers, and if they could go in there and grab a piece of pie, the piece of pie was probably bigger than the piece of pie they’d have to create if they were to build an initial DTC business.

Now, lots of the companies I’ve worked with started on Amazon and then diversified into other channels, including DTC, including other marketplaces, including international marketplaces. But, really, the world—my world has been divided into two different groups of brands: One is the brand that was already alive and well in physical retail, and the other one was the entrepreneur who decided, “I want to run a business, I want to build a brand, or I want to be a reseller and I’m gonna start on Amazon to make that happen.”

In either case, I like to say that every brand needs to have an Amazon channel strategy, whether you’re going to sell on Amazon, whether you’re going to advertise on Amazon, whether you’re going to use Amazon as a data source, whether you’re going to use it as a place to experiment and learn about new product development ideas.

Amazon’s an amazing place to leverage, and for brands that say, “Gosh, I really don’t want to be on Amazon,” okay, that’s fine. So, you don’t necessarily have to sell on Amazon, but you had best be looking at Amazon, thinking about, what can you learn about your competitors? What can you learn about potential customers? There’s really no other huge destination like this that has so much public data that brands can leverage to learn more about what it is they’re actually trying to build.

So, when I think about choosing acquisition channels, often, it’s not even an explicit discussion, because the brands have already said, “I’m going to start on Amazon. Help me grow on Amazon,” or, it’s brands that say, “Gosh, everybody else is on Amazon. I guess I should be there,” or, worse yet, “There seem to be a bunch of unauthorized sellers selling my product on Amazon. I’d like to take control of that channel and figure out, is there a way that we could do better than what all these other sellers are doing for our brand?” So, the more interesting question for me is, once a brand gets to a stable state on Amazon, how do you help that brand think about expanding into other channels?

And that’s a really scary thought for a lot of brands because they get really good at the Amazon language. The language of, “What do I need to do to perform well on Amazon?” And then, lo and behold, you say, “Well, if you want to talk about DTC, guess what? Go find your own traffic. Guess what? Figure out how to do, you know, proper funnel management.”

It was a lot of stuff that entrepreneurs don’t have to learn how to do in order to sell a lot of dollars on Amazon. And once you start looking beyond Amazon, you’re probably going to have to become a much more sophisticated marketer or even just a basic comp—you have to learn a lot more of the basics of what it takes to build a business from scratch where Amazon hasn’t taken a lot of the complexity in-house and chosen to manage it for you.

When I think back to the 2010-2011 days, I can’t tell you how many sellers I met where it was one guy or one gal and they’re running a multi-million dollar business sitting on a bar stool somewhere just sort of enjoying life. Life was easy back then: They could bring in a bunch of stuff from overseas, slap a brand name on it, sell it on Amazon, and make a bunch of money. Now the world’s not quite that complicated. Or, excuse me, it’s not quite that simple today as it was back then. But if you learn how Amazon works, you actually can make a lot of money without fully understanding what it takes to run a business. You can’t do that if you’re running a DTC business.

So, when brands ask me about how to diversify into other brands, I need to look carefully at what kind of in-house capabilities they have and help them understand that, just because it takes 40 hours a week to run an Amazon business, it’s going to be another 40 hours a week to run a DTC business. And by the way, you might make 10% of the sales that you’re making on Amazon. And so, the question around why are you looking to expand into other channels — if it’s purely for more revenue, you’re probably not going to be excited about diversifying, but there are lots of other good reasons to want to potentially diversify into other channels.

Success requires active branding efforts

Rachel Andrea Go: Tell me about some of your biggest client wins. So, how did your clients implement your advice for big results? And what was that advice?

James Thomson: When I look at brands that have done well on Amazon, I would say most of my biggest successes have been brands that woke up one day and realized their products were being sold by lots of unauthorized sellers: lots of poor branding content, probably a bunch of price erosion, and they realized, “My goodness, this is negatively impacting our core business and physical retail.” And so, [in] helping these brands think through, “How do you clean up your channel? How do you take back control of that channel? How do you take back control of the branding contents that you have consistent branding across all channels?” I’ve had many brands that basically never evolved properly to adjust to a world where eCommerce was a reality and in fact, a major, major player in their overall distribution.

Once brands learn how to make that shift and grow up and recognize they have to adapt to a world where eCommerce can have a lot of negative impacts if they don’t actively manage the channel, those are the kinds of clients that I’ve enjoyed working with the most, because the light bulb goes off and they go, “Oh, okay. It’s not about whether I want to do this; it’s about whether I need to do this because, if I don’t, someone else is ultimately going to end up controlling my brand. Somebody else is going to end up telling the story about what my brand stands for, and I don’t really want someone else to have to do that. I want to be the one that does that.” So helping brands make those difficult shifts — those have definitely been the biggest successes.

It’s not to say that I’ve had clients that have sold more dollars. Yes, I’ve had clients that were pure Amazon sellers that sold a lot of product, but helping a brand make that shift from, “I’m an old-school physical retailer,” to “I’m an old-school physical retailer who learned a new dog trick,” — you know, old dogs can’t learn new tricks — well, actually, you can; it’s just really scary because you have to make a lot of changes. Those are the kinds of clients I’ve really enjoyed working with and, you know, they’ve been able to go on and do very good things with the Amazon channel.

Rachel Andrea Go: Speaking of brand consistency, what are some big mistakes that you see when it comes to brands who are trying to keep their image consistent?

James Thomson: So, there are brands that start off thinking, “Well, I’ve been around as a brand for decades. Everybody loves my brand, everybody knows my brand so, therefore, I assume that people come to Amazon and they’re gonna look for my brand.” Well, right there is probably the single biggest mistake. Most search activity on Amazon is not branded, and so, even if you have a well-established brand, that’s not the way consumers behave on Amazon. And so you have to learn how to play the organic search game using typically generic keywords. That’s hard for a lot of brands who believe that there are millions of customers out there just running around looking for their brand. And when you’re competing against brands you’ve never heard of who know how to play the organic search game better than you, that gets really frustrating for a lot of brands.

So, you know, that’s one major mistake. The other major mistake that I would say is, when brands have gone through the exercise of getting brand registry, locking down their content, for a lot of them, they walk away at that point. They say, “Well, I’ve got the content in place. It’s locked down. I think my job is done.” Well, the reality is, if somebody’s not monitoring not just the listings that the brand locked down but listings that somebody else randomly may have created, that consistency of your brand message has to be monitored throughout all content that’s put on Amazon or, if we’re looking beyond Amazon, all content on other channels as well.

If we just stick with Amazon, you’ve got to be continuously monitoring, saying, “Is the system breaking down? Are people still going in and changing my content? Or, worse yet, are they creating duplicate listings and creating confusion for customers on Amazon?” So, recognize that your brand has to be raised like a child. You can’t just raise your child one day and then go away for a month.

And for a lot of brands, they raise their child — they’re like, “Okay, you’re all set. We’re sending you to school. You’re done. See you later.” Well, guess what? You need to continue to nurture that brand, and part of the nurturing exercise is consistently monitoring and making sure that all of your brand, not just the listings you created, but all of the listings for your brand across the Amazon channel continue to be delivered to customers in a way that’s consistent with what you’re trying to communicate in your brand.

Look for markets that check all consumer boxes

Rachel Andrea Go: I noticed you’ve invested globally. How do you choose which markets you want to invest in?

James Thomson: I’ve had the good fortune of meeting a number of entrepreneurs who are doing eCommerce in different ways. Most of them are what I would call brick—our “picks and shovels” businesses helping eCommerce—enabling eCommerce for brands. You know, I’ve had the opportunity to work with a number of entrepreneurs in the United States and Canada. I do have one company that I work with in the Philippines. It’s a former colleague of mine who happens to be based in the Philippines, and I like what he’s doing and made a very small investment to help them there. At the end of the day, customers around the world—everybody wants lots of selection at low prices delivered quickly to them. That’s kind of the Amazon promise. Well, there’s lots of companies that are needed to enable that functionality all over the world. And so, if someone’s tackling one of those issues — you know, lots of selection, consistently low prices, or fast delivery — those are all really good ideas.

And so, to the extent that there are companies that do those kinds of projects, you know, I’m certainly interested in hearing what they do. That being said, there’s an awful lot of “Me too” activity going on, and so you have to ask yourself, what can you do that’s different enough from what everybody else is doing that somebody’s going to get excited [about]? And with this particular company I’m working with in the Philippines, you know, they’re building a new type of marketplace for a wildly underserved audience in that particular country. It turns out it’s a very big country with lots of opportunity. And so, if somebody goes and finds a white space and figures out how to capture that white space, that’s exciting.

So, I don’t typically work with companies unless they’re somehow involved in eCommerce because that’s the space I know. Somebody wants to get into Cannabis, Bitcoin, I’m like, “I don’t know, that’s not something I know anything about.”

Amazon expands off the marketplace

Rachel Andrea Go: What happened in eCommerce in 2023 that you’re most excited about?

James Thomson: I am most excited about what Amazon did with starting to send out different ads to different people on some of their off-Amazon traffic. We certainly saw this with their Thursday Night Football being able to test how do you take some of the Amazon DSP content and show different ads to different customers who are at different stages of their purchasing—learning or purchase. That’s really interesting to be able to target different customers in mass media and send them different messages, and, certainly, in the last few days, we’ve seen Amazon acquire broadcast rights for more major league sports. And I think all of this is going to bode for how do we move away from the old-school “everybody turns on their TV and sees the same ads” to a model where somebody uses first-party data to be able to recognize that, “I’m at a different stage of the purchase exercise than you are and so I want different messages than you do.”

If that, in fact, rolls out in a way that we start to see the response rates, you know, much higher than what we would expect with just broad-based “everybody sees the same message,” you know, to me, that’s very exciting because all of sudden, you’ve got all this first-party data that historically has never been used in print, in radio, and TV — all of that is stuff now that a company like Amazon can use. What’s a little scary about it is that I don’t know anybody else that has this level, the mass and the granularity of first-party data that Amazon has.

And so, if Amazon figures out how to do this — there’s like, I think there’s, like, a hundred billion dollars a year in advertising dollars available in the U.S. — I can see Amazon taking a very large part of that, because advertisers will recognize that Amazon can do a better job of sending the right message to the right customer at the right time versus what everybody else does in standard print and media—or for standard print and television. So, [I’m] excited to see where that goes, also a little scared because there’s not really a good second option for companies that have that level of first-party data. And, certainly, some of the changes Google’s making to its own cookies — that will only reduce the ability of a company like Google to be a large competitor on the first-party data side.

The importance of controlling your brand

Rachel Andrea Go: So, you advise a lot of businesses, a lot of, you know, brands and businesses that target brands. What’s your advice to B2B eCommerce companies going into 2024?

James Thomson: Well, I don’t think 2024 necessarily brings a lot of huge, new challenges that 2023 didn’t have. I think we still have to look at a lot of the basics, and we’ve talked about some of this already: Brands need to control their channels so that they don’t have price erosion across channels. They need to make sure they control the branding so that the message is consistent; a brand is just consistent promises across all channels, and if you don’t have consistent content across all channels, then you don’t really have a brand.

And, certainly, we’ve seen brands get more interested in potentially selling their businesses down the road. If you’re gonna try to sell your business and you don’t have consistent content across different channels, then what exactly is it that you’re doing? You’re just selling a bunch of widgets in a box. So, control your branding, control your channel (and, hence, your pricing), be a position where you’re telling the same story to customers no matter where they are, start to test out some of these different forms of advertising so that you can see if you can capture new audiences of customers that you didn’t realize were actually potentially relevant to your products — all that kind of stuff is stuff that we need to be looking at. I don’t think I would have said something wildly different a year ago because all those basics were still in place.

For the 16 years that I’ve been fortunate enough to work with brands that sell online—what I just finished saying around the things that brands need to control, 16 years ago, we were having the same conversations. And so I don’t care what your widget is that you’re selling; if you’re putting a brand on that widget, you have to be a very good brand strategist, and the most important strategies for brands are consistency and making sure that you have control of your brand.

So, those are the kinds of impactful things that I would like to see brands continue to focus on. It’s easy even today to look at Amazon and get excited about, “Oh, we’ll just throw our product on there and we’ll grab some share. We’ll grab some sales, and it’ll be exciting.” Unfortunately, you know, Amazon’s much more competitive today than it was five years ago and certainly 14-15 years ago, and the opportunity for companies that know what they’re doing—even brands you’ve never heard of , those brands that know how to play the game on Amazon and hence know how to play the game more likely in eCommerce in general — they’re gonna have a much better opportunity to eat your lunch. And no stable, well-established brand wants to have their lunch eaten by a bunch of brands they’ve never heard of. That comes down to: Do you know how to play the game, and are you playing the game properly?

Build Relationships and Keep Learning: A Chat With Scott Needham of SmartScout

In this video, Rachel Go chats with Scott Needham, Founder of SmartScout. Rachel and Scott discuss how the Amazon landscape has evolved, his learnings from running BuyBoxer and SmartScout, the dangers of overhiring, building relationships as a growth channel, FBA fees and the bigger picture, and much more.

Transcript below.

Scott’s background

Rachel Andrea Go: Can you share a little bit about your background and what—how it led you to where you are today?

Scott Needham: Sure, yeah, good question. How far back do we want to go?

Rachel Andrea Go: As far back as you feel is relevant.

Scott Needham: So, I, you know…I studied how to be a software developer and then, when my brother was selling on Amazon, I was paying attention. I helped out a little bit, but when I started to see the problems that he was having, it was all around scaling — something that software can help out a lot with — and so I jumped in and I’ve been selling on Amazon for 11 years.

And, you know, I jumped into all things technical, [I] really tried to improve our operations, and it was fun. It was a lot of fun in those first years, just learning so much, and we were able to just grow quite a bit. And then, I transitioned. As we figured out that business model, we’re like, “What services are we using that we think we could do a better job with?” So, yeah, we started—let’s see, an agency; we built a reimbursement service; and then, in about 2019, I started a podcast of my own to learn and to share my learning.

And that podcast experience led me to lean in further into the community. And actually it motivated me to build what I currently spend most of my time doing now, and that’s working on SmartScout, which is a research tool for sellers and brands alike. And that’s what I wake up thinking about.

Rachel Andrea Go: And what was the landscape in Amazon at the time?

Scott Needham: I wish I knew better. I knew what my perspective was, but you know, we—it was a fun time to sell. There were some categories that were just so open to—yeah, it was…. There were some categories [that] if you just put a product up, it didn’t matter the price you put; it would just sell. So, we would find a lot of wide open space. And there were a few large sellers already, you know. We saw the top sellers, they were usually resellers, you know: A brand, they’d buy wholesale and sell to other brands. And what’s funny is I didn’t really notice too much or pay attention to private label. And that’s probably a mistake because we were so early. I think we could have made a dent in some categories.

It would have been a lot of fun, but we were having our own efforts of growing our business. We ended up with, you know, over a hundred employees and there was not a lot of software tools, so we kind of had to build our own stuff.

Rachel Andrea Go: I see. So, did building your own software for your business kind of pivot into one of your software or SaaS businesses?

Scott Needham: Yeah, absolutely. We did—when we were researching what brands to work with, that was kind of the beginnings of what became SmartScout. We built a tool to research brands, and I was like, “No one else has a tool like this. I think we can share it.” So, that was—yeah.

Building (and learning) from the ground up

Rachel Andrea Go: I noticed you spent quite a while building BuyBoxer. Can you share some prominent takeaways from your time there?

Scott Needham: So, that was, like, our wholesale reselling business, and…[there were] a lot of takeaways, you know. We grew and did a lot of things right, and there were a few mistakes that we lived with that were like, “We probably should have just solved that a little bit more thoroughly. I, for one, I think our finances…there was a few times that we had to look back and, like, realize, “Hey wait, you know, our inventory says this, you know, our inventory value that we count says this, and then our QuickBook says this,” and, like, we’d have to write off inventory. Now, I wish we would have just had a little bit more clarity on our finances and kind of have that discipline on a monthly basis so that we can make right choices.

I think—we actually did build our own prep. We had our own warehouse and while we put in a lot of effort and got it in a really good spot, I think it kind of forced a few decisions that were a little awkward. For example, we’d have 75 employees. We would buy product just to keep them busy. That seemed to be a theme and kind of puts a wrong pressure on your business. I think what we should have done is just have a smaller warehouse and be okay that we can’t ship everything. And that would have—that means we would have only bought the best of the best, you know. You never want to be in a position where you’re buying just to keep people busy, because the most important decision you’re making as an Amazon business is, like, is your purchase orders. You have to live with them, you have to live with them for years, or, sorry, six months, you know, so you always want to make sure that they’re very— that they’re the right mix. Yeah.

Rachel Andrea Go: So, I didn’t realize that you had such a big team both in the warehouse and in your Amazon business. Can you share a little bit more about what managing that many people was like?

Scott Needham: The truth is most of the employees were in the warehouse. So, we didn’t really have to worry too much about, you know, the purchasing that was—we used software to simplify that process. Now, another challenge that we faced with our warehouse and the staff was we actually had a warehouse in a different state than we lived in.

And, there were some cost savings reasons for that. But actually, I think by not being close to the warehouse, us owners and managers, we missed things, you know, and the motivation wasn’t there, the discipline. Or, maybe not even just discipline but, like, you know, problems would kind of get bigger than they had to, so I would totally recommend, you know, have a facility close to you.

Rachel Andrea Go: Was there any specific event that triggered the launch of SmartScout or did it kind of evolve off of what you were already creating?

Scott Needham: So, it was…like I said earlier, it was an idea that we had built a bit, you know. BuyBoxer built an idea of how to look at all the brands on Amazon. And so I…when I wanted to build a tool to serve people, I had an inventory manager and I thought that could be a really good business. But then that wasn’t innovative, whereas this research tool, to be able to look at every brand at once, you know (there’s a million brands on Amazon), and see them all, and you just be able to filter around — that was kind of a difference maker that we got really excited about. And so I’d already worked on it, connected with a front-end developer, and within two months, we had a product and we went to market so that’s—that’s how that tool came about.

Scott Needham: And because I had a podcast, when I went live, day one, we had 75 paying users. So, it was—we hit the ground running. And still, to this day, you know, we’re well past that. We’re close to 3,000 users, and it’s been a lot of fun.

Leverage all kinds of acquisition channels

Rachel Andrea Go: Congratulations! So, speaking about, kind of, podcasts as an acquisition channel, where would you say SmartScout has seen the best growth in terms of how you get paying—how you acquire paying users?

Scott Needham: That’s a good question. I really—you know, we don’t have funding and so, you know, we don’t spend a ton of advertising dollars. I think the best growth channels for us have been investing in things that can be a long-term benefit.

And so, here’s a way to think of my strategy (I learned this from Russell Brunson, he’s an entrepreneur and a writer): He talks about the Dream 100, that every industry that you are in, there’s, let’s say, a hundred people that are influential that kind of make up, you know, the movers and the shakers of the industry. These can be people on YouTube, they could be on other social media channels, they can be business owners, you know, other businesses.

And Amazon, the FBA world, the seller community — absolutely, there’s a lot of people that make up the Dream 100. And I have spent my time building relationships with them. And the best way I build relationships is I just try and make them look good. I serve them, I give them more than they give me, and often—sometimes it works: I get shout-outs; I get them on my podcast; they reshare my podcast. That was a big turning point for my podcast, was getting the right people to share it as a—and recommending it, and then my numbers went up.

So, really, it’s been a crucial part just, like, working on that Dream 100 and figuring out a way that we can work with each other and help each other. And, you know, a podcast is part of that. It’s a great way to serve people, but there’s plenty of other ways. I give shout-outs all the time and actually I wish I did more.

How SmartScout draws in leads

Rachel Andrea Go: I noticed you have a really impressive email list at SmartScout. So, how did you grow the SmartScout newsletter?

Scott Needham: You know, the SmartScout newsletter — it has been fun for me to write myself. It definitely changed: For a little while, I had an employer write it, but then when I took it over, I enjoyed it, I leaned into it, it was a way to keep myself sharp about the news but also in my voice. So, for some people, it has been interesting because, you know, I’ve been around for 11 years and so I have a perspective. The true reason why we’ve grown emails is just because anyone that jumps into the SmartScout world — we get their email, and they join it and some of them stick around and some of them don’t, and that’s okay.

The seller map tool that we have built — after people use it for about two minutes, to keep using it, we ask for their email. And early on, we had built the tool that was, you know—we collected a few thousand emails right off the gate, so free tools can be a great way to collect emails and then people that just jump in and do a free trial. So, we give a free trial to our tool and, you know, in that process, we get an email.

Rachel Andrea Go: SmartScout has an AI listing architect. Can you tell me more about what that does and how you get the data and make sure all the listings are really optimized?

Scott Needham: Yeah, so, we’ve been tracking keyword data for two years now. It’s been an interesting angle. I’m not sure if we do everything best with keywords, but we do have a few unique perspectives that no one else has. And then—so, when we matched that keyword data with, you know, the capabilities of AI we’re like, “Well, we just have to build a listing builder,” and so that’s what we did. We connected with the new AI technology and leveraged it, layered in our keyword data, and together, that’s what makes up the listing builder.

A focus on business model and customer engagement

Rachel Andrea Go: What are some things that you’ve noticed the most successful brands have in common?

Scott Needham: You know, this may be annoying to some people, but I do think that idea, the business model, the core of what drives your business matters, you know. Not all businesses are equal. I know the reselling business pretty well, lived it for years, and I really jumped in, but I have come to find out, you know — that’s not a business that you can sell very well.

And so I think people that are in that business: You should be profiting, you should be taking home money. The most important thing. Now—but, when I look at other brands like, you know, their business model matters, what they sell matters, their competitive advantage. Are they just buying generic products from a manufacturer in China, or do they have their own manufacturing process? Do they—what’s defensible about their business? Because that ultimately can lead to your margins. That can lead to having less competition. And so it doesn’t matter how good of an operator you are; if you—if the first steps of your business aren’t amazing, you know, it’s gonna be tough.

Rachel Andrea Go: And then on the flip side, are there any interesting growth or revenue opportunities on Amazon that you notice a lot of brands overlook?

Scott Needham: The latest one—it just depends what phase you are at. Let me give one—let me give two phases, depending on where you’re at: If you’re a larger business, one of the low-hanging fruit would be… actually, what’s the…”tailored?” I can think of every word but the right word…

It’s customer engagement. They’re customer engagement tools, and the first one that they’ve built is called Tailored Audiences, where it allows you to reach new customers. And so, if you have a sophisticated brand, like—you totally gain everything by doing this. I think that, then…yeah. I’ll mention another one is, if your product has a video…well, if you have a brand registry, you should have a video on your product. Why? Because it actually opens up your product to affiliates that they can monetize your product.

So, if you look—say there’s a product with a video. Usually, Amazon will show there’s gonna be, like—they’ll open up five slots of videos for influencers to promote your—and talk about your product. They actually monetize that, they make money off of that. And so, if you have one video, it actually opens the gates for five videos. And it’s been a solid conversion lift for several people that—to do that.

Rachel Andrea Go: So, what are some prominent changes in eCommerce—last year, in 2023, that you found the most interesting or that promises long-term impact?

Scott Needham: I mean, the most obvious change was actually in December, when Amazon announced that their new FBA fees, which kind of incentivizes you to help Amazon’s—they help their Amazon supply chain to be more efficient. So, they’re like, “Hey, you can shift to this one warehouse and it’s gonna cost you this much. But, if you ship to three warehouses, we’ll give you a discount.” And so, some people were annoyed by this, but I just look at it as just common sense in that, if you’re going to be a good partner to Amazon, they’ll be a good partner back. And if you do this, your FBA fees don’t even go up. So, it was a great way. I think that’s probably the better way to look at it than to just be annoyed at Amazon and their fee structures changing every year.

Scott Needham: I think, on the landscape of things, TikTok Shop, I have, you know—in December, I sold 12 units on TikTok Shop, and we have plans to do more. It is a—I personally am hesitant to learn new business models. It’s tough. It’s tough when you have an existing business that’s doing really well. You have it figured out, and then to, like, jump into a new one? It’s hard. But we had the right product that was, like, in the right spot, we were motivated — Let’s go TikTok shop.

And, oh, what I was gonna say I like the most about TikTok Shop is it kind of—it’s just everything in one box. The reason we like Amazon is, like, everything that we need, we can solve through Amazon’s services. Same thing as on TikTok, you know? They have an advertising portal, they have an affiliate portal, or, like, an influencer portal, and then, you know, their seller center. So, it’s just nice to have it all there and so they could play nicely with each other. Whereas, if you are on Shopify, then you’re like, “Well, I have to bring traffic through Facebook or Instagram.” Then you’re dealing with two different platforms. So, I like simple, and TikTok Shop so far has been fairly straightforward.

Rachel Andrea Go: Have you noticed any pricing concerns between if you post an item on TikTok as well as on Amazon and they’re a different price?

Scott Needham: No. We had a higher price on TikTok and then we would discount, you know, here and there, so, that’s not so far that—it works, you know? It’s just kind of—you’ve got to match the—it has to be a reasonable price of what people will pay. But I think, you know…I think you could actually take advantage of that, the arbitrage of knowledge.

Rachel Andrea Go: What’s your advice to merchants going into 2024?

Scott Needham: Really, it’s—what I wish I would have heard my second year of selling is that there is so much more to learn. And so just take—you should have a few learning opportunities every year, and, you know, I explain one, TikTok Shop can be a learning opportunity, and there are—there’s gonna be a lot. So, just make sure that you’re not, like, too stale in your knowledge and that you keep pushing forward.

Amazon Influencers Focus on Conversions vs. Traffic: A Chat With Liz Saunders of Fluencer Fruit

In this video, Rachel Go chats with Liz Saunders, Founder of Fluencer Fruit. Rachel and Liz discuss Liz’s journey with Jungle Scout, how she learned to communicate with both creative and technical teams, and her journey building Fluencer Fruit. They also talk about the differences between Amazon influencers and social media influencers, how UGC affects conversions on Amazon, and more.

Transcript below.

Liz’s background

Rachel Andrea Go: To start off, could you please share a little bit about your background and how it led you to where you are today?

Liz Saunders: Absolutely! So, I started years and years ago as a brand working with bloggers. So, if you think about, like, the influencer brand space, I started in the early 2000s as the brand. And then, as time went on, I started as an Amazon seller in, like, 2016, and then went to work for Jungle Scout in 2017, [I] was there for six years, and so I’ve spent a lot of time in the seller space. And then about two years ago, a friend of mine was like, “Hey, you like all the Amazon stuff. You should take a look at the Amazon Influencer Program.” And I was like, “Sweet! Yes, let’s talk about it.” And so she showed it to me, and so I started it as a side thing just to play around with. But then — and I know you’ve spent some time in the Amazon space as well — it became really obvious that, like, there were no tools for it, and there was nobody talking about it, and it was just kind of like this weird side thing that was happening.

And so it was like, there’s a lot going on over here that nobody’s talking about. And so, from the seller side and from the brand side, I was like, “We can proactively work together [to] help sellers make more sales.” And then also, on the flip side of it, it was—for the influencers, it was like, “This is like anything else on Amazon,” which is that it comes down to product research. Right? Like, if you want to make money doing this, it’s about picking the right products. And so [I] built a tool for the Amazon influencers and then started working with sellers who wanted to proactively work with Amazon influencers.

Rachel Andrea Go: Cool, that’s super interesting! You mentioned you were a Jungle Scout for around six years. Can you share a little bit more about your time there and what you learned?

Liz Saunders: Sure. So, I was there for six years, and it was interesting because I joined—I think I was, like, team member number 38, right? And then, at the height of the market, we were up over 300, and when I left, we were a little bit below that.

But it was really cool because you go from—everybody does everything, right? So, of course the engineers are not necessarily doing marketing, but, like, I worked directly with the founder and CEO, Greg, as his brand manager and assistant and then as his chief of staff, so kind of like all the way through. And it was like, I realized that, when you start at that size and you scale up, that most of what I was doing was, oh, initially, I would handle a project, put it together, and then they’d hire a specialist who would come and be like, “I do this one thing,” and they’d take that over. And so I had an opportunity to really work kind of, like, across a ton of different projects, which was really, really fun. If there was something that, like, didn’t have an owner, maybe we were gonna continue it, maybe we weren’t; that stuff usually ended up with me. And so I got to do a ton of really cool things.

Rachel Andrea Go: Awesome. Do you have a very memorable one or a favorite?

Liz Saunders: Let’s see…. Towards my last two years, I did a lot of stuff where—so, my background is more on the marketing side, that’s kind of, like, my home base — so, affiliates, like, that kind of stuff. And, I think, my last two years, at some point in there, the product and engineering teams were like, “Hey, we could use somebody with your skill set to kind of, like, help us manage these cross-team, cross-departmental situations.”

And so I ended up moving from where I was mostly interacting with, like, marketing and soft skills and those sorts of things to, like, the tech people in the company. And it was one of my favorite things that I’ve done because it was learning an entire new skill set around how to communicate with people, how to get things done, and I loved every part of it. Then I was like, “Okay, so now that I’ve worked on this side…” after that, I was able to then help in the pieces, like, the projects that were both marketing and product and end, and all these different pieces. And it was like, “Okay, so, how do you help the projects that need buy-in and need, you know, people on every part of the company moving forward on it?” But there’s not, like, one person who owned the entirety of it, so sometimes things would get lost.

So I would come in and help move those things forward with tons of different, you know, stakeholders, which was—I think that was my favorite thing. So, it wasn’t necessarily, like, one project per se as much as it was this whole new way of communicating and then helping to bring everybody together to move things forward.

Managing creative vs. technical teams

Rachel Andrea Go: Amazing. Are there any big differences in how you communicate with a largely creative team versus a largely technical team?

Liz Saunders: I think—and this is just going to be observations, so if anybody on either of those teams is listening to me, it’s just my experience. But I think, interestingly, in the marketing and that side of things, a lot of times, it was…I don’t want to say “touch….” It was, like, that you would explain things and make sure that people were bought in and it felt a little bit more, like, emotional, you know what I mean? Like, making sure that people were in and that they got it and everything else, whereas the product and end team, they would be like, “No, we disagree with that,” and you’d be like, “Oh.”

Initially, I was kind of taken aback. I was like, “What do you mean?” and I would take it kind of personally. They’d be like, “No, no, but that’s just not the best way to do it.” Okay, got it. But sitting in those meetings actually has helped me because, moving forward, I’m like, “Oh, I get it. We don’t have time to sit around.” And kind of—it helped me become much more direct in a way that I think helps projects move forward. And I’ll say, from the other side, it was probably, like, my background and my own insecurities more than just this particular team from the marketing side of things. That was just kind of, like, how I interacted with them.

But on the product side and the engineering side, sitting and listening to them disagree but not in, like, a—there never seemed to be an ego situation. It was just kind of, like, “You know what? Mathematically, that doesn’t work for us.” And it really helped move things forward a lot faster. So, being around them for a period of time helped me kind of move forward in that myself where before, I was a little bit more, like, “I don’t know how you guys feel about this, but maybe we could do this,” instead of being like, “Hey, you know what? The data says that we should probably build this newsletter and keep moving forward with this,” you know what I mean? Yeah.

Starting Fluencer Fruit

Rachel Andrea Go: So, you founded Fluencer Fruit last year. Was there a trigger or moment where you realized, “The world really needs something like this, and I’m gonna go 100% in”?

Liz Saunders: Yeah, so, I initially thought that it was gonna be a side hustle, right? I was talking to, you know, Greg, and I was like, “I’m doing this. I built a tool.” And then I was doing onboardings at, like, seven o’clock in the morning and 10:30 at night and I went back to him and I was like, “I think this isn’t a side hustle,” like, “This just got much more intense faster than I thought it was going to.” And so he and I worked on an exit plan and all of these things. But I think that was the moment where I was like, “I can’t do this and my full-time job. Like, it was almost immediately too much once I launched the actual extension to users. I was like, “I need to pour myself into this.”

And then, simultaneously, it was like, “Nobody’s talking about this for sellers and how to proactively work with the people in the Influencer Program.” And so when I made the decision then I, like, simultaneously launched an agency piece as well. But it was just because—it was like…there was this void. Nobody was really doing anything. So, when you go in, everybody’s like, “Oh my gosh, what is this?” You know?

Rachel Andrea Go: Can you tell me a bit about how you built Fluencer Fruit from kind of the ground up?

Liz Saunders: Yeah, for sure. So, I was very fortunate — even though my background is not on the product side of things — in my time at Jungle Scout to read a lot of product briefs, you know, start to interact with that side of the team. And so, once I kind of had an idea of what I knew the tool needed to do, I put together a product brief and then I ran it past a couple friends who are product managers and I was like, “Can you read this for me and just make sure that if I hand it to an engineer, I have enough information for them to go execute on this?” And so [I] did that but then I ended up, on Upwork, hiring a team that actually is still with me. They’ve transitioned a little bit but it’s been like…let’s see, that would have been, like, November ‘22…? So, it’s been, like, 14, 15 months, same team. And, yeah, they’ve been awesome.

So, once I started working with them, you know, any time you work with new people, regardless of skill set, we developed our own cadence, our own communications, and everything else. But I will say, for anybody else who is starting to do this type of work, the mistake that I made was I sent them all the things and I assumed things into the conversation. Specifically, I assumed that they knew that I wanted to be paid for the extension, and they assumed that since I did not scope that into the project that it was going to be, like, part of something else. And so, we finished the extension, and I was like, “This is fantastic!” And then it was like, “There’s no way for people to pay me for this.” So I had to go back and rescope, like, an entire milestone for them to kind of, like, build that in after everything else was built.

So, if you are thinking about roadmapping a project like this, just remember that every piece, like—go through it from the customer perspective. And then hand it over, because it definitely helps if you have all of it laid out initially.

Fluencer Fruit branding

Rachel Andrea Go: Speaking of building Fluencer Fruit, I really like your branding.

Liz Saunders: Thank you.

Rachel Andrea Go: I was on your website for a while and it’s very distinct and really memorable. So, how did you come up with the concept of “fruits” in relation to this kind of line of business?

Liz Saunders: Yeah, great question. So, I basically just kind of joke with people that I’m like an old-school marketing student where I like alliteration. And so, when I was thinking about what to do with “influencer,” then I was like, “What if we cut it and then it’s ‘fluencer’ and alliterated ‘fruit,’?” But from there, I don’t know if you know, there’s an old-school—when Amazon…I don’t know if it was when it was first started, but Jeff Bezos used to put banana carts in, like, yeah. If you Google it, it’s pretty funny. So, he used to have bananas as, like, the snack options. There were banana cards in the Amazon headquarters. And so, once I got to the fruit part, I was like, “Well, we have to go with bananas because Amazon OG folklore,” right?

And so I did that and basically—so I went and, because—I don’t know a ton about, like, copyrights or anything else, but I went [and] I was very intentional about buying this banana, that commercial copyright, whatever I needed to be able to use it in all of my stuff. And then a friend of a friend was like, “Oh, I’ve got this design company.” And so I hired a design company and I said, “Here is my banana. This is the name of my company.” And they went from there; they started with the banana and the name of the company and they did all of the branding that you see.

So any time that I do a one-pager or a sales deck, I’ll send it over to them to make sure that it’s—because I get so many comments and compliments on the branding piece, and it really does, like, kind of set it apart from a startup that’s been around for six, eight months, whatever, since we launch-launched. And having the branding, I’m really grateful for the team that has done this because every time I send them something they’re like, ”Oh yeah, here’s your new whatever it is,” and it matches everything. So, when you see my stuff anywhere, it’s like, “That’s Fluencer Fruit’s stuff.” It stands out.

Rachel Andrea Go: It’s so memorable, and I think, for your audience, it’s such a good call because I’m sure influencers work with so many different, kind of, partners [that] they all fade together.

Liz Saunders: Yeah, and it’s fun! I’ll go on TikTok or Instagram or, you know, pick your poison for social media, and people will be talking about the tool. And it’s funny, because people will be like, “Is that the banana tool? Is that the fruit tool? Is that the—” but they know, right? And then you know what they’re talking about. It’s like “Is that the yellow one?” But all of it, like, even if they can’t remember the name, like, “Fluencer fruit,” they know that it’s part of that ecosystem, right? So it’s really kind of fun to watch.

Deciding on a target audience

Rachel Andrea Go: So, looking through your website, I notice that most of your pages are targeted towards influencers.

Liz Saunders: Yes. I do.

Rachel Andrea Go: You do have a page for brands, but why did you choose to focus on that side of, kind of, the relationship?

Liz Saunders: Yeah, good question. So, the—a lot of the site is specifically for the tool, right? And so, since that’s where I get most of the questions, it needs the most explanation because there are, when I launched, no other tools for influencers, right? So, it’s crazy for me coming from the seller side to think about a part of the Amazon ecosystem that didn’t have any tools, right? But, because of that, a lot of people in the Amazon Influencer Program didn’t come specifically from the Amazon background. They just like our content creators. And so they also may or may not work with a lot of tools off of Amazon as well. So, the focus was specifically around that.

Now, the seller side of things with the brands needs a little bit more conversation. And so, when you look at, like, the pages for sellers, they’re relatively simple, right? It’s speaking to, like, optimizing your listing with video, what the ROI for working proactively with Amazon influencers are — some of those things. But truly, the best way for me to talk to sellers is to be on podcasts, to be where they’re at, and then get those conversations, because a lot of it makes so much more sense once I’m looking, like, at their listing, talking them through where an influencer would show up, what it might do for their sales, how Amazon is prioritizing — all of those things.

Whereas because there’s not a ton of information out about it right now, most sellers come into it thinking that Amazon Influencer’s going to drive traffic to their listing. But really, the Amazon Influencer Program is specific to on-site content, so it’s, you know, on your product listing, in the search results, in Inspired, Discover — all those places. And, usually, people know maybe one out of four of those places. And so, if I can get on a call and show them where it is, it tends to make a lot more sense than sending them through a ton of landing pages. So that’s why the site is heavy for the extension and a little lighter on the seller side because those are a lot of conversations.

About the Amazon Influencer Program

Rachel Andrea Go: Thanks for those insights. And speaking of the Amazon Influencer Program and where that content shows up, can you tell us a little bit more about how everything works?

Liz Saunders: Absolutely. So, as an Amazon influencer, you create what’s called Shoppable Content. So, it can be a shoppable photo, a shoppable video, or a live stream (also shoppable). And then once you do that, you tag the products that you’re talking about. So, you don’t even have to have purchased it on Amazon, but it has to have a listing on Amazon and it has to be the exact listing, right? It can’t be like, “Oh, this is something that people have generically manufactured from Alibaba, it will go with any number.” It has to be the exact, right?

But then once you do that, you tag the ASIN or ASINs, and then, from there, Amazon handles 100% of the placement. So, if I’m doing a shoppable photo and I have, like, 10 items tagged, it’s eligible to show up in the Inspire or the Discover feed. But if I do a shoppable video, if I tag more than three products, it’s not eligible to show up on the product listing.

So, you have to keep it under three tags in order to show up on the product listing, which is really—when we talk about the return on working with influencers, the shoppable videos with the product page placement is the one that we have the most data around, and even that, we’re, like, working directly with sellers to combine the data to talk about what’s in it for everyone. But that product page—once I upload my video, it takes 24 hours to get published, goes to my storefront, and then, once it’s published, [it] usually within 24 hours Amazon will place it. And that is usually, you know—if you look at a product listing, if you’re brand registered, you’ve got the upper carousel, you have the lower carousel below the fold — those are the places that are the most obvious for people. So, if influencers are creating content for your product, those are the first two places I would look.

Rachel Andrea Go: Have you noticed any big differences between Amazon-focused influencers who are, you know, just focused on Amazon versus influencers on general social media?

Liz Saunders: All of the influencers that I work with are Amazon specific. So, I am very specific about working with the on-site because it’s such a different ecosystem than TikTok or Instagram or anything else. A lot of them didn’t come from an Amazon background, so they were in, like, merch and then moved over or doing, you know—there are some of those but not often. So, they’re learning the Amazon ecosystem as content creators. But, to answer your question, there are some pretty interesting differences between content creators who are focused on, like, TikTok or Instagram and content creators specifically creating content on-site for Amazon, which, if you think about it, it usually makes sense really quickly, right? On TikTok, I have an audience of people, right?

So, let’s say I’m a fitness influencer, right, on TikTok. I want you to go look at this other product whether it’s TikTok Shop or whatever. I’m gonna show you how I’m using it and I can be trendy, I can use music, I can use whatever. But I want you—I’m pushing traffic, whereas the on-site content creators that are in the Amazon Influencer Program — they show up as you are about to make a purchase. So, they’re not trying to drive you anywhere; they’re trying to convert you, right? Think about, like, on YouTube: If you’re an Amazon affiliate or an associate, you’re pushing traffic and you do care if they buy what you’re sending them to but you’ve got a 24-hour cookie for the entirety of their cart. So, your goal is to get them there and then you just hope that they’ll purchase a ton of stuff for themselves and everybody they know that day right?

But the Amazon influencer, because they’re on-site, they want to convert you. So, they’re talking very specifically about a product, about the features, doing unboxings, showing you how to assemble it — all of those things. And so, those are the ways that make the most sense to me about how different they are. I’m not pushing traffic; I’m converting traffic.

Amazon is testing where influencer content appears

Rachel Andrea Go: Awesome, and great summary as well. So, are there any influencer trends you’re seeing specifically in relation to the Amazon marketplace?

Liz Saunders: That’s a great question. So, currently, I wish that I could call this a trend, but it feels more like a test. So, Amazon is currently—it appears to be testing different layouts for the product page. So, for example, if I am in incognito mode and not logged in to my Amazon account, I see both the upper and the lower carousel. But, if I’m logged in and not on incognito, I only see the upper carousel, I don’t see the lower carousel. Now, I do not have any insight into this from Amazon, I’m just guessing by watching over the last, like, six months. It seems like they are testing to see which of the product page layouts converts the best.

At the most optimal cost between affiliates, influencers, [and] sellers. And so, they’ve been doing that for probably four or five months now, where they’ll rotate people through. It seems like they have cohorts where, currently, I don’t see any lower carousels unless I’m logged out and in incognito. I see none, whereas you might be logged in in, like, a track browser and be able to see all of that. So, I think they’re split testing different cohorts. So, that’s kind of the biggest trend that I see is Amazon building for sustainability, right?

So they’re testing for what looks like the long-term because, you know, any time you ride the Amazon wave, there’s always going to be changes, there’s gonna be new things to learn. And so, I know some people who maybe don’t come from the Amazon space initially have been a little discouraged by the changes that Amazon has made to product listings and how it’s impacted. But, if I look at it holistically and think about the seller journey over the last, like, seven years, there’s always going to be those things changing and I think we’re going from—people have been making money hand over fist. It’s just been blue ocean in the influencers space, right? And so, now, Amazon is setting it up for a long-term structure, testing the page types, seeing if they need all of us, testing to see what types of content from us: Is it vertical shorts that do really well and convert—drive more traffic, or is it shoppable photos? And how many on a product listing? So, I think right now, the trend for 2024 specifically for the Influencer Program or the part that is going to make the biggest impact is Amazon (hopefully) finalizing some of this stuff so that we’ve got a little bit more stability to continue building.

Because I think one of the most interesting things about the Influencer Program is, like, merch, KDP, third-party selling right? All of those things exist on Amazon, but there’s not a lot of overlap, right? You can do all, you can do one of them but they don’t necessarily touch each other — retail arbitrage, whatever the case is. Influencers, however—Amazon’s stated purpose for the program is to help buyers make more confident buying decisions. Well, that means we’re helping the buyers make more confident buying decisions, which helps sellers sell more, which helps Amazon make more money, which helps influencers make money. So, it’s this really cool program that overlaps and helps everybody win. So, it’s pretty unique in the space.

Influencer considerations for brands

Rachel Andrea Go: Moving to the brand side of things, are there any key factors to consider—that brands should consider when choosing what kind of influencers to work with or try to work with?

Liz Saunders: Yeah, absolutely. So, I think — to go back to what’s the difference between the off-site and the TikTok/Instagram influencers versus the on-site — if you’re working with somebody that you want to drive traffic from Instagram over, then you want them to be within your niche, right? You have a fitness company, you want a fitness influencer. The difference when you’re working with an Amazon influencer for on-site content is they don’t have to have a niche.

So, you can just find somebody that you want to work with and you like the quality of their content. So, if you’re looking and you’re like, “I really would like somebody who can speak to this supplement, this fitness thing,” whatever the case is, if you look at your listing and/or your competitors’ listings, look in those carousels. If it says next to the person’s name “Earns commission,” that’s an Amazon influencer, and you can click on their name, find their socials on their storefront, and then reach out to them off-site.

Rachel Andrea Go: So, it sounds like, with social media, TikTok, Instagram, the influencers you work with, you’re trying to get to their audience and their network.

Liz Saunders: Yep.

Rachel Andrea Go: But the Amazon influencers that you work with, you’re trying to get them to convert your existing audience.

Liz Saunders: Correct.

Rachel Andrea Go: And so you just need them to be good at selling.

Liz Saunders: Yeah. And if you think about it, every seller is already paying to drive traffic, right? So they’re just there to help you close the sale, you know? You want them to talk about things that you as the brand can’t talk about as authentically, right? Like: How soft is it? Is it painful? How long does it take to work? Those sorts of things. Like, “When I was installing it, I found that this was an issue. So, if you just do this—” whatever the case is, right? Because somebody—it’s basically user-generated content. It’s UGC on your listing to help convert people.

Influencer considerations for 2024

Rachel Andrea Go: What do you recommend eCommerce sellers should know or do or keep an eye out this year?

Liz Saunders: So, I think we’re going to see — I mean, just, you know, of course, in the influencers space — like, that stabilization of the product listings, and maybe I’m just hopeful but I think we’re gonna see that. And I think the thing to be on the lookout for is, do you already have influencers on your product listing? If not, who do you want to be working with, right? Because we know a couple things and they just kind of trickle down, which is, you know—Amazon even tells sellers on the back end of Seller Central, “Hey, add a product video. it could increase your sales” I think is how they say it, right? And then we know, like, if you go from there, that most shoppers prefer video to text, right? So, they are maybe not reading your text bullet points that you have historically been able to rely on.

And then we know that UGC or Amazon influencer content converts better than brand content. So, when you put all of those things together, like, proactively working with Amazon influencers, I think works in everyone’s favor. And you can talk to us, which does set us apart from, like, the Vine Program, right? Where it’s a little bit more black box. We’re FTC TOS compliant, so I think that’s really, like to be looking out for as brands. You’re just going to see more and more and more of this.

AI influencer effects on Amazon

Rachel Andrea Go: There are a lot of AI-generated influencers right now. Is this something you see affecting the Amazon space anytime soon?

Liz Saunders: So, maybe, because it depends on if Amazon will say yes or not, right? But recently, specifically, there—we saw an influencer get banned for using the TikTok AI voice in an Amazon influencer video. So, they repurposed it, which you’re allowed to do. You’re allowed to repurpose Instagram, Tiktok content, but Amazon didn’t like that it was the TikTok AI voice. Now, I also have seen—I was watching a review the other day [and] I was like, “This is an AI voice.”

So, I think it could. But I think, like, with most things, we see this, like — most things in Amazon anyways — we see this, like, push into how far can we push the envelope from people using the platform. And they’ll do, like, reading scripts, they’ll put together AI voices, like, all that stuff. And then Amazon will come through and be like, “No,” and just shut it all down because Amazon does, at their core, want authentic, real content for their shoppers. So, I think it will have a short-term impact, and then I think Amazon will be like, “No, we’re out on that. We don’t want AI people, AI-generated scripts reading,” like, that’s not organic.

The industry is consolidating: A chat with Steven J. Edelstein of Fulfillment IQ

In this video, Rachel Go chats with Steven J. Edelstein, Vice President, Strategy and Partnerships, at Fulfillment IQ. Rachel and Steve talk about his background, where merchants and 3PLs need more alignment, keys to smooth eCommerce logistics, and his predictions for the future of 3PLs.

Transcript below.

Steve’s background

Rachel Andrea Go: Can you share a little bit more about your background and how it led to where you are today?

Steven Edelstein: Sure, sure. It’s interesting, my history. As you can see to some extent in the answer I gave you, I’m quite an anomaly in this business. And the reason I say that is because I spent quite a bit of time on the merger acquisition and leveraged-buyouts side in private equity, which gave me my, I guess, entrèe into health and beauty and logistics as a general rule. Subsequent to that, [I] started acquiring, building, and selling very niche, very scientifically formulated skin care companies. So, I’ve done seven indirectly and directly over the last 20-plus years (knock on whatever).

They have been very successful but, again, because they were so dedicated to the science and knowing exactly who the demographic market is and was and needed to be, it had a very good opportunity for success because of that go-to-market strategy. With that said, everything I did as a CEO, president, [and] owner — interestingly enough, although I spent some time on the marketing strategy side of the business, most of my interest and attention was paid to the back-end logistics because, the way I saw things, I had very smart people handling the packaging, the messaging, the content, the story, the formulation — all of the above.

But in considering that and doing all that right, you must be able to execute on the back end. So, I learned everything I needed to learn about technology, about operations, but more importantly, process and procedures and methodologies and steps and things that you need to take in order to be hopefully, reasonably proficient at what you’re doing. Everybody makes mistakes, everybody has issues. But (and I mean this sincerely) the most important thing you can do in any business segment (and I’ve said this several times throughout the document) is listen, communicate, say what you know, and be true to yourself. And so, coming full circle, the irony is, you’re coming out of the brands, working with a number of notable 3PLs over the years, being involved with brand business obviously, being involved with different types of consulting opportunities — this particular situation was presented to me or vice versa (I think it was a collaborative) and it made perfect sense for me to be part of the commercial team and running strategy and partnerships for this company because it is my personality.

Rachel Andrea Go: So, you found Fulfillment IQ through a partnership of one of your own companies?

Steven Edelstein: I did not, actually. Fulfillment IQ was unearthed to me because of my relationship with Dan Cole. Dan and I have known each other for many years; we tend to laugh and say we’ve run parallel lives. When he got involved with Fulfillment IQ, I was interested because, interestingly enough, I was in the process of starting another company with a very similar business model called the Logic Train.

Rachel Andrea Go: I love it.

Steven Edelstein: So, when I put two and two together and I realized that Logic Train was not going to be leaving the station, okay, and with no passengers, I said, “Let me explore the Fulfillment IQ angle,” and, as it turns out, it was a good fit. It’s become a better fit as time’s gone on. I’ve been here a little less than two years and hopefully contributing to the success of the company.

Where brands and 3PLs need more alignment

Rachel Andrea Go: Amazing. Well, from your background, I’ve seen that you’ve seen our industry — so, eCommerce — from both the brand side and the logistics side. What are a few places that you’ve noticed that brands merchants, you know, and 3pls need more alignment or should have more alignment.

Steven Edelstein: I think, first of all, as I pointed out, cultural assimilation has been critical, and there are people that will disagree with me. But I do believe in subject matter orientation. I do believe that, if you’re going to survive long term in the logistics of Industry, you need to learn how to coexist with your brands. You need to understand what they do on a day-to-day basis. You need to understand their internal workings, both from a marketing but more so from a technology and operations perspective, really aligning yourself in such a way that you don’t create a lot of obstacles.

Okay, secondarily, as I said, not only cultural assimilation but also terminology. You have to have basically a somewhat of an understanding—you don’t have to be an expert but somewhat of an understanding of the words, of the language, of the terminology, of the phraseology of what these people go through on a day-to-day basis because it just makes it easier to have that communication with your provider. If they understand what you do — let’s say 90% — and you understand their day-to-day issues, both pro and con, and you understand technologically what they have in place and can work with that in terms of not only data integration but pure transactional flow, and operationally you align philosophically and otherwise, then you have a good relationship.

I will tell you that the biggest problem that I’ve seen unilaterally with most of the 3PLs, logistics companies, supply chain companies, distribution companies, etc., fulfillment companies all under the same—they do all the same thing — is that they don’t make an effort to get an understanding of what that client goes through. They don’t make an effort to understand the industry in which they live and breathe. And they’re, in some cases, quite arrogant about it. In simple language, if you don’t fit into (and no pun intended) the box that we have, then quite honestly, we don’t want to work with you, which I will tell you more later. But the short answer is also that, as we move into ‘24, ‘25, and ‘26, as I said (and we’ll talk about this a little more as you get that question), they better be careful, because the industry is consolidating.

There are going to be less and less companies out there that are servicing that need. So, if you take a subject matter orientation and you take that niche approach and you understand the ICPs, the clients that you’re working with, and you have an appreciation for their day-to-day and, generally, their philosophical view on business, trust me, not only will you do very well financially otherwise, but you will also have a relationship for a very long time.

Logistics companies that will last through a consolidating industry

Rachel Andrea Go: So, it sounds like the companies that will last through this consolidation are the ones that will actually put in the time to get to know each individual client and so does that mean having a wider kind of menu of services doesn’t mean customizing down to a tee? What does that look like?

Steven Edelstein: I think that’s—first of all, yes, you’re correct. Having an understanding of the client business, their brand, their intention, their go-to-market strategy, all the things that are critical to their lifeline, but I think even more important is, you know, as we have this supposed consolidation — and by the way, it’s gonna happen over the next few years; it’s not gonna be a 12-month event. It’ll be 24, 36, maybe 48 months. But my point is that it’s also a matter of taking a look at your infrastructure. Take a look at your technology. What does your order management system look like? What does your warehouse platform look like? Are you functionally aligned with the clients that you serve each and every day. So, a lot of that “shoring up,” if you will, is more about making sure that you are secure and protected for some of the ups and downs that are going to potentially occur as the consolidation unfolds and make sure that everything that you have in place from an academic perspective is fluid.

Rachel Andrea Go: Perfect, thank you. And I think that’s a good transition into Fulfillment IQ, because I think they’re, you know, a really good partner and solution for all of this. So, can you tell me a little bit more about Fulfillment IQ? And what’s your main focus there?

Steven Edelstein: Sure. As I pointed out in my document, we segment but also integrate. They’re all integrated practices. Commercial starts with a good level of analytics. Deciphering, understanding, listening, communicating what the problem might be. We are practitioners. We provide solutions. We are not typical consultants.

And I mean that sincerely. We are actionable in what we provide and we handle the work that needs to be done. So, when we provide a solution, we don’t stop at the solution and say, “Okay client A, it’s time for you to do the work.” We roll up our sleeves. We build the resources. We handle the program.

So, commercial is one aspect. And, again, commercial is everything from business development from a design perspective; it is looking at business modeling; it is looking at research analytics; it is looking at deciphering different types of processes and procedural issues. But it also involves looking at your operations infrastructure, your technology infrastructure, and also, in many cases, your go-to-market strategy. So it’s very consultative but very collaborative in terms of how we work with our client partners.

Second to that but also equal, as I pointed out: product development, software development, middleware development, algorithms, applications — simply put, everything rolled up into technology. But product dev can be done as a licensed product, it can be done as a standalone custom developed product, it could also be done as an augmentation to existing products. We do a lot of WMS developments, both augmentation as well as design and builds, and it is comprehensive — everything from tier one products,  whether it be I can say names like Manhattan, Corber, Blue Yonder, etc., to tier two’s like the Deposco, Eulogia, Osa Commerce, or Snap Fulfill, or any of the notables out there, and some you’ve never heard of.

But our responsibility is not only to know who these companies are but, because we handle the lion’s share of integrations on behalf of these clients, surprise, surprise, we have to know how they work.

So, a lot of that is in product, a lot of that is in software, and much of what we do, again, is wrapped with a lot of operations advice, a lot of operations influence, a lot of technology advice and influence. But in some cases, on the private equity side of things, we do get involved with some investments — smaller, specific, very strategic investments. And that practice is ever growing. So, FIQ in a nutshell, is a commercially developed company that is an inch-wide, mile-deep supply chain consultancy.

Rachel Andrea Go: I love the execution aspect because, for busy founders, busy companies, that is really the deal maker, I think.

Steven Edelstein: I, selfishly, Rach, I mean, it really is, I mean, for us. And it also puts us into a very unique position primarily because we can see things through to the final actual execution, which is a nice place to be.

Rachel Andrea Go: Yes, absolutely. There are a lot of consultancies where they will tell you what to do and then it’ll never get done and then the company or the client has ended up, you know, wasting their money a little bit for something that they don’t have the resources or time or, you know, manpower to execute on, basically.

Steven Edelstein: Spot on. You hit the nail on the head. The expense is always that albatross that is looming and, if the company can’t realize some kind of return on investment (and that was something also that you might have noted in the document), large focus on ROI, large focus on measurability, large focus on accountability — really important. And it is a mantra, it is a mantra for this company to make sure that, when we do X, we realize X plus something. And that’s a requirement and that is a philosophical approach, honestly, that we have with our clients as well, not just for our own needs but for our clients. To make sure that when they do something, when we do something with them, that there is that return on investment that is part of that process.

Rachel Andrea Go: Got it, and when you mentioned clients, so, this kind of leads to my next question, but your role is focused on both strategy and partnerships…

Steven Edelstein: Correct.

The role of partnerships in Fulfillment IQ’s growth strategy

Rachel Andrea Go: So, can you go into a little bit about how do partnerships play into Fulfillment IQ’s overall, like, growth acquisition and strategy?

Steven Edelstein: As I pointed out, they’re very strategic. We do not have tiers, as I also pointed out. We don’t have levels like platinum, gold, silver, and bronze. We’re not vying to be in the Olympics, kids, we’re a supply chain company and we’re helping brands understand and generate solutions to their problems. Okay. So, with that said, everyone is equal. Everyone is equal. We don’t segment it even in the industry segments. So, for instance, our partners don’t get segmented into operations versus technology versus finance versus this. This is not the case.

And, as I said earlier, it started very selective and the reason why we’re selective vice versa is that we want to make sure that there’s revenue generated through that relationship. We don’t want to be that company that reaches out to three, four, five, six, seven, 10 different companies on behalf of a specific opportunity and have them all competing against each other and creating dissension and, most importantly, good, bad, or indifferent, creating a stigma that tells them that it’s just a fishing expedition. So, rather than do that, we have a very selective process that we go through to make sure that, if we have a partner or two or three in place, not only are they gonna achieve results but they’re gonna make money along the way. Because ultimately, at the end of the day, I don’t care what anybody says: Life, business, unfortunately, is about revenue. And therefore, at least make the revenue achievable is what I’m saying.

So, partners are very important to our ecosystem. Partners are very important to the organic growth of our opportunities, and I’m very blunt: This business, for all better purposes, is about three things: timing, trust, and relationship.

It’s not a commodity business nor should it be. Sometimes it is, unfortunately, but it shouldn’t be. It should be about value, it should be about solutionizing, and it should be about the relationship that you developed, which creates reciprocal trust and mutual respect. And I know those sound like very lofty words and very esoteric, very emotional, but the simple truth is, when all things are equal, that’s why a client chooses FIQ for instance — because of the personality, because of the relationship, and because we are people that understand that they are people that need some support.

Common supply chain mistakes

Rachel Andrea Go: Having spoken about all of your experience with—between 3PLs and seeing different sizes every partnership, what are some of the steps of the supply chain that you’ve seen most either brands or 3PLs or both make mistakes?

Steven Edelstein: First and foremost, the project plan is the Holy Bible as far as I’m concerned and I say that very, very agnostically in terms of, you know, that religious implication. But seriously, the project plan is that Bible. It is the Taskmaster, it is the operational and organizational chart that holds accountable for everything. I can tell you, unfortunately, most companies don’t—either they start out with a project plan and they don’t continue to use it, or they don’t have one at all. And I think it’s a big mistake, because, in my opinion, in our opinion and the industry’s opinion, this world is a collaborative environment. Nobody has all the answers, but we’re gonna try as hard as we can to find those answers.

So, we’ve got a good project plan that illustrates start and end dates, accountability, milestones, benchmark reviews — all the things that are critical to the process. Very important but, like I said, coming full circle, very underutilized, if it exists at all. That’s A. B: Listen, communicate, talk to each other. Don’t hide behind your email.

I love Slack, I love texting, I love emails, but when I need to get something done, call them. Pick up the phone, talk. Maybe it’s old school, maybe not, but in today’s inconsistent communication world, [it’s] better to speak direct than try to interpret something that can’t be interpreted.

The other is, the last thing I’m gonna say, is know what you know and know what you don’t know. You have a problem? It’s almost like a 12-step situation. First thing to do, you have to admit you have a problem. Once you admit you have a problem, you go through a process and you go through a step-by-step methodology to get to the end result. But you’re always going to be better off knowing that you’ve admitted—acknowledged that you have an issue rather than trying to work around it because, at the end of the day, the problem is still going to be there, okay?

So, those are some of the problems, some of the pros that people are paying attention to their technology to some extent. People are—companies are starting to pay more attention to their operational processes and their procedures. They’re getting better, they’re getting better.

Remember, this industry has been around for a long time and it hasn’t changed; it’s still stuck in 1972, okay? And I’m gonna tell you what I tell my colleague friends all the time: There is not one warehouse in this country that is any different than the other. They are populated by the same people, they have the same racks. Some have better technology, some have worse; some have better operations processes, some have worse. But, at the end of the day, the personalities within that warehouse are all the same, and I can take one person from Hebron, Kentucky and put them into a facility in Ontario, California in the same job and within five minutes, they’ll be up to speed doing what they’re doing and probably complaining about the same things that they complained about in Hebron, Kentucky.

So, my point is: Pay attention to your brand. And I’m not talking about the brand itself, I’m talking about the supply chain, about the logistics company. Pay attention to who you are, what your personality is, philosophically what you represent, and, for God sakes, stay in your lane.

Rachel Andrea Go: You mentioned kind of like a project plan earlier, like it’s really important to have a project plan in place.

Steven Edelstein: Correct.

Rachel Andrea Go: Is each one variably different, or do they all take roughly the same three or four meetings to put together? Can you tell me a little bit more about the process of getting those project plans together?

Steven Edelstein: Sure. Project plans are unique to each engagement, and they should be because every task for each engagement is different. So, therefore, we have, obviously, as a corporation, as a company that does this, obviously, on a repeated basis, we have a very good template to work from in terms of format. But, in terms of content, content is crafted, drafted for each individual project plan and, as far as timing is concerned, typically takes no more than three to five days to complete.

Rachel Andrea Go: So, essentially, it’s just a few days for the health of your entire project.

Steven Edelstein: Indeed, because most of the legwork, most of the data gathering that we’ve achieved has done well in advance of the project plan being drafted. So, it’s really more about—I’m simplifying, but it’s more about execution at that point, seriously.

Steven Edelstein: So, it’s very, you know—once we have all the information in place, we know what the steps are, and we’ve had many conversations prior, again, that project plan, in terms of development, is pretty straightforward.

The most important areas to get right when it comes to logistics

Rachel Andrea Go: So, the project plan is one, but can you suggest three other very important things that brands and merchants need to get right when it comes to their logistics?

Steven Edelstein: First and foremost, make sure, above and beyond again, what we just discussed in terms of project plan. Let’s talk about tech for a minute.

The technology, the functionality of their technology, for all practical purposes, should align with the types of clients that they’re working with. Different SKUs, different bundles, different kitting are going to require different levels of functionality.

You also have to take a look at your complete technology ecosystem. What does that look like? If you centralize your warehouse management platform, is their middleware that’s involved? Is there an order management component? Is there a transportation management system? Are there applications that coexist with the system? And, most importantly, make sure again that the functional behavior is consistent with the types of clients you’re working with because, ultimately, it’s going to affect not only the operational fortitude but also the reporting aspect and the analytics of your business, which, in my opinion, is probably more critical and more important than any other aspect of the business. So, tech is one part.

Kind of parallel is having that communications process in place in terms of meetings, milestone meetings, QBR’s, that kind of cadence, but also having the operational processes that coexist with the communication that takes place. So, in simple language, having that ability to have insight to the steps and the activity — better word — of what’s going on operationally and being able to have easy access to information, which will be communicated to the end user.

The supply chain is broken

Rachel Andrea Go: So, my next one is about last year. What are some of the things that happened last year that you’re really excited about or that will, you know, basically impact us far into the future?

Steven Edelstein: Well, you’re asking a question that is pretty easy to answer for Fulfillment IQ, because the way we look at things, the more the supply chain is broken, the better off it is for us. So, with that premise in place, what I’m excited to see in the future is A) the understanding that companies are going to get much more focused on who they are and what they do and how they do it, and, most importantly, be respectful of their approach to the market.

Clients are getting much more intelligent about how they operate their businesses from a back-end, logistical perspective. They’re much more in tune with how to operate the business, logistically versus from a go-to-market strategy perspective. I think that, because of the supposed consolidation that is going to take place, I think most companies, both brands, retailers, fulfillment groups, 3PLs, whatever you want to call them, are all going to have to prepare for the long term and make sure that they are structurally set up to have incremental not only growth but incremental functionality as the market continues to change.

What to look at when choosing your logistics partners

Rachel Andrea Go: Thank you. And my last question, just to wrap up, kind of, the consolidation that we’ve just been talking about this whole call: Would you advise brands need to go for one of the big guys when it comes to fulfillment? So, like, if I was a brand, do I need to go with someone who will for sure be there and not be acquired in the next three or four years?

Steven Edelstein: I mean, you make a very good point, and it’s an excellent question. Not to dilute the question, but I think it really is a case by case situation. I think there are some smaller entities that, again, have an understanding of the environment in which they live and breathe as well as the clients live and breathe and can coexist very nicely without having the size and long—legacy and longevity that they might have. So, I think that’s a good thing. I think that you need to be aware of who they are as a business, who supports them financially. Are they independent owners and operators? Are they private equity venture capital supported? Are they institutionally supported?

You need to understand that structure, that’s important. And does that align with your business? Structurally, from a corporate perspective, and administratively. So, I think you need to take a look at that. But, again, it’s a case-by-case situation, but generally speaking, size has nothing to do with anything, it really doesn’t, doesn’t have anything to do—it has more to do with ability, understanding of the market, experience with products and businesses that are similar, and can they speak the language correctly?