Michael Begg, CEO of AMZ Advisers, discusses effective strategies for launching and scaling brands on Amazon. He explores common challenges brands face, the importance of setting appropriate budgets for advertising, and effective pricing strategies. Mike shares insights on international expansion, particularly into Latin American markets, and the complexities of multi-platform e-commerce. The episode offers valuable perspectives for brands looking to thrive on Amazon and beyond.

Episode Transcript

Adrian Tennant: Coming up in this episode of IN CLEAR FOCUS 

Michael Begg: Amazon is very much a pay-to-play platform. And if you’re not investing into a significant advertising budget, there’s no way that you’re actually going to be able to stand out.

Adrian Tennant: You’re listening to IN CLEAR FOCUS, fresh perspectives on marketing and advertising, produced weekly by Bigeye, a strategy-led, full-service, creative agency for growing brands for clients globally. Hello, I’m your host, Adrian Tennant, Chief Strategy Officer. Thank you for joining us. According to Forbes Advisor, global e-commerce sales will total an estimated $6.9 trillion this year, almost 22% of all retail sales. Research from NPR and Marist finds that just over three-quarters of American adults are online shoppers, with 25% shopping online at least once per month and 16% at least once weekly. Amazon is the dominant force, representing 38% of the US market, making it the largest online retailer in the country. Selling on Amazon has become essential for many consumer businesses but the platform presents challenges for brands that want to stand out, scale their operations or navigate international markets. Understanding these dynamics and developing selling strategies can mean the difference between thriving and merely surviving. Today’s guest is an expert in helping brands maximize their e-commerce potential. Michael Begg is the co-founder and CEO of AMZ Advisers, which is focused on accelerating brand growth on Amazon and platforms like Walmart and MercadoLibre. With over a decade of experience in e-commerce and Amazon marketing, Mike has helped numerous brands scale online and navigate the complexities of global expansion. To discuss e-commerce strategies, the challenges of selling on Amazon, and the opportunities that international markets present, I’m delighted that Mike is joining us today from Guadalajara, Mexico. Mike, welcome to IN CLEAR FOCUS.

Michael Begg: Adrian, thank you for having me here. I’m really excited to be speaking with you today.

Adrian Tennant: Mike, can you tell us a bit about your journey to becoming the co-founder of AMZ Advisers?

Michael Begg: Of course, and it’s been definitely an interesting journey. I graduated university in 2012 with a dual degree and I started working in consulting for one of the big four. I realized that I really didn’t enjoy consulting. I wanted to make a change, went into retail, real estate. I actually started working in real estate development. During that time is where I’ve kind of learned about the e-commerce wave that was coming. I was working at Sears of all companies, no longer exists. And what I was doing at the time was I was redeveloping Sears real estate and trying to find new uses for it. And one of the deals that came across my desk. was Amazon trying to buy a Sears store. And to me, that just didn’t make sense. Why would Amazon want to buy a Sears store? And then I started learning that you could sell products online and that Amazon was turning the store into a warehouse and all these different types of things that kind of opened up my eyes to what was possible in the e-commerce world. From there, I just started selling products online, mainly on Amazon. And Eventually we got to the point where we realized, myself and my partners, that we were doing better than most of the big established brands out there. And that kind of opened our eyes to what AMZ Advisers is today, helping other brands succeed on the Amazon platform. So that was a high level view of the entire journey to becoming one of the founders of AMZ Advisers.

Adrian Tennant: Well, Mike, I gave a summary in the intro, but could you tell us more about the services AMZ Advisers offers and the types of clients you typically serve?

Michael Begg: Yeah, so we work with brands that are doing between $5 to $20 million a year online. And specifically what we help them with is a few different areas. One, mainly the Amazon channel management. Amazon is an incredibly difficult platform for a lot of brands to handle on their own. So we come in, we handle their advertising, their SEO, their marketing, and just help them succeed in that aspect of it. Another service we offer to our clients is helping them expand internationally. We have teams in Europe, we have teams in Latin America. So we help a lot of U.S. brands break into new markets. And then finally, we help with affiliate marketing. Affiliate marketing is a very profitable marketing stream for a lot of brands, especially when you’re paying for performance. And it makes it a very attractive option for brands to select as they’re trying to grow. So those are the different services and the types of companies that we’re working with.

Adrian Tennant: Great. As you explained, AMZ Advisers focuses on helping brands grow on e-commerce platforms. So Mike, what are some of the most common challenges brands face when trying to establish or expand their presence on Amazon?

Michael Begg: So I think there’s a few different ways that you can go with this. And the main challenge overall is not understanding how to represent the brand correctly on the platform. And this comes in a variety of different ways. The first obviously being content, making sure that the content that you’re creating, the product images, the copy that you have is well aligned. with the copy and the creative that you have on your other platforms and websites. If you don’t have a consistent customer experience across all your channels, it’s going to lead to either customer churn or it’s going to lead to customers essentially leaving your page without purchasing. So that’s the first thing that brands make a big mistake with. The second big mistake is that they don’t invest enough into advertising and growing on the platform. Amazon is very much a pay to play platform. And if you’re not investing into a significant advertising budget, there’s no way that you’re actually going to be able to stand out. So good example of this, if you’re coming into the advertising side on Amazon, If you’re a water bottle, let’s say, and you’re not advertising on the keyword water bottle, it’s very unlikely that customers are going to find your product. It’s even more unlikely that your product is just going to start magically ranking number one for that keyword without having some type of impetus like an advertising spend or budget behind it. And then finally, the last one, I would say, where a lot of brands struggle, especially brands that have brand recognition outside of Amazon, is that they don’t protect their brand on Amazon. And what I mean by that is that with the advertising, anyone can advertise on your own branded keywords. If you are not advertising on your own branded keywords, you increase the likelihood of customers churning, you increase the likelihood of customers going to a competitor brand, because your competitors will be advertising on your keywords. So those are really three of the main areas that most brands struggle with when they’re trying to come and launch correctly on the Amazon platform.

Adrian Tennant: Mike, let’s talk about your New to AMZ program. What are the key elements of this service and how does it help brands new to Amazon get started?

Michael Begg: Of course, New to Amazon, or New to AMZ, as we call it, is a program that essentially takes every brand from zero to being fully launched and advertised and marketing on Amazon within 60 days. What we do in that 60-day period is we first help you get your account open. in itself can be of a challenge sometimes. You have to go through a verification process. You have to make sure that everything is set up correctly. From there, we get your products listed. So we need to make sure that your products have UPC barcodes, that they’re correctly created on the Amazon platform. From there, content, how are we going to make sure that your content looks great and that it’s consistent with what the content on your website looks like or on other sales channels that you’re on? Social media, for example, is a good one that we’ll try to make sure everything aligned is on. And then from there, it’s how do we actually launch? How do we get the sales going? And it comes in a variety of different ways. One is advertising. One is product promotion. So offering discounts, offering coupon codes. And then finally, the last step is reviews. Like how do we get the social proof on there to make your product stand out or make customers believe that your product’s real? So we accomplish all of that within 60 days. And we really help brands go from not being on Amazon to actually start selling and start scaling on the platform from there.

Adrian Tennant: How do you typically advise your clients to attract reviews?

Michael Begg: That is the million dollar question and it’s not easy. I will say that the first thing you need to do is to enroll your products in Amazon Vine if they’re eligible. For Amazon Vine, you need to have less than 35 reviews on your product already. Essentially what happens with Vine is that you give away a certain number of units and a Vine trusted reviewer will get the unit for the product and then leave a review based on what their experience is with it. That is the number one way, start getting reviews. Beyond that, the real only option you have on Amazon is automating your review requests. So you can send out requests for consumers. And I’m sure many of you have probably seen that in your email before, where you get a message saying, what did you think of this product? That is essentially automating the review request on the Amazon side. So that’s a very important aspect that you need to handle. You need to make sure that you have a tool or a resource in place to help you request all of those reviews because it’s the only way you’re going to build them up over time. Outside of that, it’s very difficult to get customers that have purchased your product on other platforms to leave reviews on Amazon. Obviously, you can do marketing efforts to push people to Amazon to leave a review. But what you cannot do for customers that have purchased products on Amazon is offer an incentive for them to buy the product. So you cannot offer $5 off. You can’t offer $10 cash back. All those types of things are considered incentivized reviews and against Amazon’s terms of service. And if you try to do those, it’s a very good way to get your Amazon account shut down.

Adrian Tennant: Great, practical advice. Thank you, Mike. For brands that are already on Amazon, but looking to scale, you offer an accelerator program. Can you walk us through what this program entails?

Michael Begg: Of course. And a good starting point to answer this question is understanding how the Amazon platform works. Amazon’s no different than Google. It’s a search engine and certain factors improve or affect your ranking in the search engine. One of those factors being conversion rates, one of them being your sales velocity, how long you’ve been selling and how fast you’re selling or how much inventory you’re turning. And with that information, what we do in the accelerator program is we try to manipulate those metrics to help you get better results and start growing faster. So we focus in a few different ways. One, we started looking at conversions, start identifying what issues on the product detail page, maybe preventing the product from converting well. or what improvements can lead to better conversions for our brand. And then the second piece being that we’re going to start advertising on a lot more keywords and start expanding the advertising and how aggressive we’re being. The goal here being that we want to increase the number of sales as much as possible on these main keywords. What that’s going to lead to is the algorithm essentially saying, your product is relevant for this keyword because you’ve driven this many conversions for this long on the platform. So we should move you up higher in the rankings. And that’s going to lead to more organic discovery. So essentially what we do in the accelerator program is we’re helping brands create a positive feedback loop to get their products ranking higher on Amazon.

Adrian Tennant: One of the areas you specialize in is global expansion, particularly helping US brands enter European markets and vice versa. What are some of the biggest hurdles brands face when expanding internationally on Amazon?

Michael Begg: There are various challenges, and no two challenges are the same for each brand. It really depends on where the company is located. But when it comes to expanding to the US, for example, it is fairly easy for most foreign companies to set up in the US and get their tax ID and be able to start selling on the platform. That’s a pretty straightforward process. But when you’re looking at expanding to Europe, for example, it gets a little bit more complicated. The European Union has their own set of product compliance and regulatory frameworks that most brands need to make sure they are in compliance with to be able to sell their products. And it gets even more complicated when you start looking at the UK, because now you have differences between the UK, Europe, the US, and dealing with and reconciling all those differences to make sure that your product is compliant in each marketplace is extremely difficult. So that’s one of the big areas. The other big challenge is really fiscal. Tax IDs are pretty straightforward, But making sure that you’re filing your taxes correctly in each market that you’re selling in is extremely important. I mean, a failure to pay taxes and create significant problems for your brand and deeply affect the asset and the value of your company. So you really want to make sure that you’re compliant with all those aspects. And that’s one of the things that we make sure all the clients we work with are doing.

Adrian Tennant: Let’s take a short break. We’ll be right back after this message.

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Adrian Tennant: Welcome back. I’m talking with Mike Begg, co-founder and CEO of AMZ Advisers, about strategies for success on Amazon and other e-commerce platforms. Mike, you’re based in Mexico and help foreign brands enter markets like Mexico and Brazil. What makes these markets particularly challenging and why should US brands consider expanding into Latin America?

Michael Begg: Anytime you’re expanding internationally, whether it be to Europe or to Mexico or Brazil, there’s a variety of different compliance and legal challenges that come with it. The unique challenge with Latin America is that each individual country has significant different policies and requirements that are extremely different than what the expectations are in the US and in Europe. Good example of this, we sell supplement brands here in Latin America and supplement ingredients that are allowed in the US are not necessarily allowed in Mexico. So making sure the products are compliant between each marketplace is a lot of the work that we put into it. So that’s one of the main issues. Another big challenge that expanding to Latin America brings is that in most of these countries or most of these marketplaces, you need to actually have a business or a business representative in place in that country. And that requires, obviously, having someone you trust there. That requires registering for your tax IDs. Without your tax IDs, without a business and a business representative, you essentially can’t sell in these marketplaces. So in a way, it creates a lot of barriers to entry for most brands. But at the same time, it presents a lot of opportunity, which is why we focus on it so much for so many brands, is that once you figure out how to get past these hurdles, it unlocks a massive market for you.

Adrian Tennant: Market research is essential for developing strategy, especially on hyper-competitive platforms like Amazon. Mike, can you explain your approach to product identification and selection? For example, how do you help brands determine which products have the best potential on the platform?

Michael Begg: So there’s a variety of different ways we can do this and it starts initially with looking at what search volumes look like. There’s a variety of third party tools as well as data that Amazon provides sellers that allow you to look into what search trends are occurring on the Amazon platform or what the search volumes are to identify what a market opportunity size looks like. That would be one way that we’re helping our clients with the market research side. The other is a little bit more about competitive and seeing how a brand or how a product would sit in the marketplace in relation to its competitors. And on that end, we’re going to look and focus a little bit more on is our price point competitive? Are we in line with the top sellers? Are we more of a premium product? Because all of these things are going to influence the strategy that we would be implementing to actually help these brands scale. And then the last aspect that we would really want to look at is it’s called review modes on Amazon, but essentially how many reviews do your competitors have? For example, if you are a new product to Amazon and you only have two, three reviews and your competitor has 30 or 40,000 reviews, it’s going to be very difficult to compete on that standpoint. It doesn’t mean that you shouldn’t do it. You just have to have that expectation in place that There’s so much more social proof built up on our competitor listings that we’re going to have to do a lot of work to catch up to them. And we’re not going to see the best results in the beginning because their product looks way better than ours. So sum it all up. You want to look at what the market looks like overall, how much search volume, how much demand there is. And then you want to look at where your brand sits in the competitive space from price point, from product reviews, potentially even from differentiators or other keywords that might be more long tail. Those are different aspects that you want to take into consideration when doing your market research.

Adrian Tennant: Pricing strategy is another critical aspect of success, as you just mentioned. Mike, how does AMZ Advisers support clients in developing effective pricing strategies that balance competitiveness with profitability?

Michael Begg: There’s a direct correlation between price and conversion rate, especially on Amazon. I mean, a lot of consumers are going to Amazon to find a deal that is maybe better than what they’re seeing in the retail stores. I mean, it’s common at this point for someone to be shopping in whatever retail store and checking on Amazon to see where the price is the best. So pricing is a very powerful tool when it comes to actually influencing that ranking algorithm that I mentioned earlier on Amazon, because it will drive more conversions for us. From a pricing strategy standpoint, our initial goals with brands as we’re trying to scale up their sales or scale up their growth is to get them to the point where they are essentially break even or where they’re turning inventory as fast as possible without necessarily losing a profit. To do that, we probably wanna lower our price or be a little bit more competitive on price to begin with because it’s gonna lead to those additional sales, it’s gonna lead to more conversions, more units, and it’s gonna improve our rankings. When we look at a long-term trend of keeping our pricing low at a competitive standpoint, there’s a very good example of this from a case study that was prepared I think earlier this year at a long-term brand that kept their pricing, I think it was about 15% below the average market price. They ran essentially at a loss for more than a year, generating more and more sales at that lower price point in comparison to their competitors. What happened was after about a year they got to the point where they were the number one product on Amazon in their category. From there, they increased their price point to be back at their normal margin or their target margin that they were looking for. And now by being in the first spot, by having built up all those sales, all of that review history, and now increasing their price, they went from the product essentially being a loser to making them, I think it was like 4 to 5 million a year in profit by being the number one product. Pricing strategy is really influential when it comes to how your product can convert better and eventually rank higher within the Amazon algorithm.

Adrian Tennant: Interesting. Well, as you know, Amazon’s advertising platform has become increasingly important for visibility. How do you approach Amazon’s many advertising options for your clients?

Michael Begg: The way that we kind of approach things is we think of a typical marketing funnel. So in a marketing funnel, we have top of funnel, we have middle of funnel, we have bottom of funnel, top of funnel relating to brand awareness, middle of funnel being more consideration. and bottom of funnel being people that are ready to purchase or the conversion piece. When we start launching brands in the advertising side, it is very easy to throw advertising dollars away if you start at the top. Brand awareness has some of the lowest return for brands. And that’s why we tend to focus actually on the bottom of the conversion piece. People are going to Amazon because they’re ready to purchase. And when you look at the average conversion rates on Amazon, they’re about two and a half to three times higher on Amazon than they are on Shopify websites or other e-commerce websites. So knowing that customers are coming to buy products that I’m more likely to convert customers, we initially focus heavily at the bottom of the funnel on how can we deploy advertising dollars to convert as many customers as possible. Once we’ve reached our maximum there or the incremental return on our advertising dollars is not as great as it had been before, we’ll start moving up funnel and how do we create more consideration by targeting competitor products, by showing up on searches related to the product category we’re in. And then moving up beyond that, how do we create the brand awareness now? How do we create retargeting campaigns? That’s another great way for brand awareness to eventually turn into customers. So it really starts at the bottom of the funnel from the advertising side. And then as you start seeing success and seeing growth, you want to start moving up the funnel and using the variety of different advertising tools that Amazon has.

Adrian Tennant: With the rise of other e-commerce platforms like Walmart and Mercado Libre, how do you advise brands to balance their presence across multiple marketplaces?

Michael Begg: We’re a big believer of be everywhere. And in general, I think that’s what will lead to the best results for brands in the long term. Amazon’s obviously the number one platform you need to be on because so many consumers are going there. But not having your products on Walmart or if you’re in Latin America, MercadoLibre is just essentially leaving the market open to other people. And we see this all the time. We have worked with a variety of brands that are very well-known brands on Amazon. When we look at their other platforms, they’re either non-existent or they’re not performing well. So I do think that you need to focus on all of the platforms in a way, but you also want to prioritize the most important for your brand. One interesting thing about the differences in customer behavior between shopping platforms is that Amazon tends to be more focused to, let’s say, non-consumable goods. And when I say non-consumable, I mainly mean food, food being consumable. On Walmart, you’ll actually see food products perform a lot better than you will see them on Amazon. So you really need to keep that consideration in place while you’re expanding your brand. I mean, if customers are buying more food products on Walmart, you should be focusing more of your presence there, more of your effort there. Versus if you’re not selling a food product, Amazon is probably the number one platform you want to focus on and everything else becomes secondary. I recommend being everywhere, but identifying which platform is going to be the best for your brand based on the type of product or the vertical you’re in, and then focusing most of your effort there.

Adrian Tennant: Are there any product categories that just don’t work on Amazon or the other platforms we’ve been discussing?

Michael Begg: There are. It’s difficult. I mean, there’s very niche categories that don’t perform as well. So for example, when I look at certain verticals, industrial and scientific products, those typically don’t perform as well on Amazon as they would on more niche websites. When we look at the variety of categories there are, I mean, those are probably some of the ones that we focus on the least. For us, we see massive volume of sales in anything that’s health and beauty, anything that supplements, anything that is pet supplies, baby products, toys, books, obviously. There are a lot of categories that are really, really dominant on Amazon, but scientific and industrial products is not one of them.

Adrian Tennant: Got it. What trends do you see shaping the future of e-commerce and Amazon selling in particular?

Michael Begg: So there’s constantly new things coming up. I think one of the most recent ones that has been talked about is called Amazon Rufus. Amazon Rufus is essentially the AI shopping capabilities that Alexa is going to have going forward. So it’s going to become more and more important to optimize your product listings for AI search. And that’s still something that we’re learning about and still something that we’re trying to figure out how to do the best. AI is going to be playing a more and more important role in how customers shop products and consume products. That’s one big trend that is definitely going to be shaping the future of e-commerce. And the other one is social and video shopping. That’s another big one I believe is going to continue to grow. I think we’ve seen TikTok really come out of nowhere as a big platform and start driving significant revenue for brands. So video shopping, video content is leading people to purchase products. So being able to utilize video content in your marketing strategy is going to be extremely important going forward.

Adrian Tennant: For brands that are just starting to consider Amazon as a sales channel, what’s one piece of advice you’d give them?

Michael Begg: I think the first piece of advice I would give to the brands looking at Amazon is to make sure that they really have the money to invest into the platform. We’ve touched on it earlier, but if you don’t have a significant ad budget to launch with, you’re really not going to get the results you want on the Amazon platform. Typically, any brand that we’re launching with, we’d recommend starting with at least $5,000 a month of an ad budget just to be able to get decent results. I mean, depending on the category, that $5,000 could be anywhere between $10,000 and $20,000 in ad sales. In addition to that, you’re probably going to see additional organic sales. So $5,000 can really help you jumpstart the brand on the platform or having a significant ad budget can really help jumpstart the brand. So that would be the number one consideration I would tell most brands to do.

Adrian Tennant: On IN CLEAR FOCUS, we love case studies. So could you give us an example of a brand that you launched on Amazon?

Michael Begg: Of course. And I think this is a really good example of a brand that invested well into the platform. Rainier, as a company name, is probably not that well known, but some of their brands are probably a little bit better known. Rembrandt Whitening being one of them. It’s a tongue twister. And Plackers being the other. We launched both of those brands on the Amazon platform. And from the start, we had a significant ad budget. Within the first 3 months, we had essentially gone from $0 to about $150,000 monthly run rate. And then from there, having the additional ad budget allowed us to continue to scale. Within 12 months, we had grown the company from doing, as I said, about $150,000 a month or essentially launching at $0 to doing a $6 million run rate per year. So having a significant budget can allow you to really scale up quickly on the Amazon platform. Having some brand recognition can also help in that aspect. But that’s a very good example of how having that budget can really lead to more success.

Adrian Tennant: Great example. Thank you. Mike, if listeners would like to learn more about your work at AMZ Advisers, what’s the best way to contact you?

Michael Begg: The best way to get in touch with me is directly at my email, mike@amzadvisers.com. You can also contact us through the website or reach me on LinkedIn.

Adrian Tennant: Mike, thank you very much for being our guest on IN CLEAR FOCUS.

Michael Begg: Thank you very much for having me. I really appreciate it.

Adrian Tennant: Thanks again to my guest this week, Mike Begg, the co-founder and CEO of AMZ Advisers. As always, you’ll find a complete transcript of our conversation with timestamps and links to the resources we discussed on the IN CLEAR FOCUS page at bigeyeagency.com. Just select Insights from the menu. Thank you for listening to IN CLEAR FOCUS, produced by Big Eye. I’ve been your host, Adrian Tennant. Until next week, goodbye.

TIMESTAMPS

00:00: Introduction to E-commerce Trends

02:10: Meet Michael Begg: Journey to AMZ Advisers

03:55: Services Offered by AMZ Advisers

05:03: Common Challenges on Amazon

07:02: New to AMZ Program Overview

08:22: Attracting Reviews on Amazon

10:01: Accelerator Program for Scaling Brands

11:25: Challenges of International Expansion

12:57: Expanding into Latin America

14:05: Market Research for Product Selection

16:07: Developing Effective Pricing Strategies

20:05: Approaching Amazon Advertising

22:05: Balancing Presence Across Marketplaces

23:37: Product Categories That Struggle on Amazon

24:22: Future Trends in E-commerce

25:26: Advice for Brands New to Amazon

26:18: Case Study: Successful Brand Launch

27:42: Contact Information for AMZ Advisers