$10,000,000 Challenge – February 2022 Updates
By Nate Slamans – February 15, 2022
Table of Contents
Goals: For the Year and for the Month
If you’re a new reader to the blog, let me bring you up to speed. This year, 2022, we want to get $10,000,000 in sales on Amazon. Up until this year, we’ve been using the same 7-figure seller habits to brute force our way to $10,000,000+. This year, we wanted to break out of those habits and form 8-figure habits. On this blog, we’ll share updates on our year-to-date progress – any trials and tribulations we’ve faced and, of course, major lessons that we think will help you grow your brand. Of course, we have some awesome updates on our $1,000,000 product line goal!
So, strap in and join us as we think this month’s updates will help Amazon sellers, whether you’re a new seller or someone who’s been in the game for a while!
Subscribe to the $10M Challenge to be notified when a new progress update is available:
To recap, January was a pretty good start to the year getting to 87% of the month’s goal of $700,000, around $611,700. We were so close but, unexpectedly, Amazon gave us a few more hoops to jump through – one of our core product lines, which was forecasted to earn up to $200,000, was suspended for a third of the month and reinstated in the last few days of January.
For February, we recalibrated our goals a little bit due to our core products being down for a while as we had to factor in lost ranking juice and momentum that we had to gain back
February Revenue Goals
For February, we had the following goals:
Real February Stats (Sales, Ad, Spend and Profit) - Where We Ended Up
- Ended the month at $465,954.75
- Up by $143,200 (30%) vs December 2021
- Overall Conversion Across All 100+ ASINs: 12.07% vs 10.35% Last Month
- Session Value: $8.21/Session vs $8.29/Session Last Month
- ACoS: Up to 19.73% vs 19.34% Last Month
- TACoS at 11.29% vs 10.67% Last Month
Let’s discuss the results one by one. To start off, for the revenue, we were only able to get to 66.56% of our sales goal for the month, way lower than what we originally anticipated which we’ll get into in a little while. However, our session conversion across all of our ASINs is up almost 2% – indicating that the traffic we we’re getting was better quality and directed more to the desired audience. Although, our session values were down slightly. I took a look at our data and the majority of the products that hit their individual sales goal were at the lower end of our price spectrum which caused the session value to drop a little. This + the higher spend associated with the honeymoon phase of our new product line could also justify the slight increase in our PPC metrics.
As you may know, lower priced products are naturally expected to convert at a higher ACoS than a higher priced product. Say, you spend $1 to get one sale of a $10 product, that’s an ACoS of 10%. Say you spend the same amount for a $50-product, that’s an ACoS of only 2%. The fact that some of our higher priced items didn’t do as well could have caused the ACoS to increase by the slightest bit (again, plus the additional spend on our new products this month)
For PPC, though we still stuck to our PPC campaign calendar, and key metrics mentioned in the January blog that have really helped us:
- Bleeders checks – make sure to incorporate a schedule twice a week to check unconverting keywords. Which leads me to TIP#1]
TIP 1: Have a general rule of thumb when deciding to pause, lower or negate keywords.
For us, we follow (albeit not a hard-set rule) a simple 10-click rule. That is when a target has not received any conversions after 10-clicks, it’s time to decide to either pause, lower or negate the keyword. This is not a hard-set rule just because some awareness or new product campaigns are not expected to convert as well. For this, we generally follow for products that have garnered a decent number of positive reviews. We then decide, based on the spend, if it’s for negating (test keywords that might be related but not exactly relevant), pausing (unprofitable spend), or lowering the bid (when it’s relatively high in spend and relevant)
This way, when checking for bleeders you have a rough idea of what to do immediately. This is especially helpful for brands with numerous products. However, we feel that building SOPs and habits like these will make our lives easier when growing multiple brands.
2. Consider individual product profits – as mentioned previously, it helps to keep a tracker of each product’s net profit to drive your KEY decision points – product price changes and PPC decisions.
Here’s a summary of where we are so far with the year. We’re currently at a total of $1,077,106.60 which about 11% of our goal for the year.
This month was an incredibly slow month for us BUT one event really did hurt our sales even more.
A Problem that Kept Persisting
If you’ve been following this $10,000,000 journey for a while, you’ll know that one of our core product lines got suspended in December 2021 which we got back after a week. Then, 3 weeks later, it got suspended which caused us to lose sales for these ASINs for a good third of January 2022. We got the listing back towards the end of January so we were hopeful that we were going to get a good number of sales as forecasted (about $130,000).
But well, what do you know? Not even a week later, we got suspended again for the exact same ASIN. At this point, this is getting very silly and honestly, irritating. We’re not sure what’s causing this as seller support isn’t really giving us a clear answer. We never made any changes to our listing since it got reinstated late January.
We did eventually get it back 3 weeks later. Although it took a long time, we didn’t need any back and forth from seller support like the last time this happened when we had to open like 10 cases. Let me give you a quick summary of what we did to get our listing back up:
- I get text alerts whenever we lose the buy box on our products (we use Helium10 to do this), so we caught this before Amazon even showed this on our Account Health Dashboard. So, we immediately opened a case. This just helps get ahead of the problem since we were able to resolve issues within minutes before for some listing suppressions.
- Since nothing came of this, we waited for the suspension to appear on our Account Health Dashboard, and we created an appeal when it did.
a.) If this is the first time your listing got suspended, create a detailed appeal containing (1) What you think is happening, (2) what you did to make sure you’re compliant to policies (3) what you’re going to do in the future to prevent this from happening again.
b.) If this is a recurring problem like ours, just reiterate your proof of compliance AND most importantly, reference the case IDs where you where Amazon confirmed the compliance of your ASINs.
- After this, it’s a waiting game. Make sure to constantly check the status of your appeal as Amazon might ask something from you and if you don’t reply within 5 days, Amazon might close the case and you have to repeat the process again.
Now, cases aren’t the easiest thing to track, especially with the case log page containing all cases even those that might not necessarily be the most important for you. Which leads me to:
TIP 2: Keep a case log tracker
A simple sheet where you keep track of your most important cases that you need to follow up on. Just make sure it contains the following:
- Case ID
- Date of Creation
- Short Description of what the case is about
- Summary of Amazon’s last reply
- Date of Last Reply
Simply it could look like this:
Keeping a case log tracker will help you on so many levels. One, it’s going to be a lot easier to follow up on cases since you don’t have to hunt for the case in the case logs, just copy the case ID and you’re good. Two, you can keep track of case IDs that resolved your dilemma so you can back track in case a similar issue arises and you still have record of the case ID that fixed it.
This simple tracker can help you streamline your case tracking and help you get your products back for sales as soon as possible – saving you from losing too much revenue.
Amazon will keep hitting you with all the random problems and each one, even though incredibly frustrating, can be a key learning opportunity and this month we’d like to share some of our other key discoveries.
In our last blog, we mentioned that we were starting to send batch shipments of our products over to FBA via LTL shipments, instead of the small parcels delivery (SPD) to save money. We were able to save a significant amount on shipping for the first few products (these are very similar type products in the way they are packed) we sent over using LTL:
|Shipment||Freight Class||% Savings||$ Savings|
For the past year, we’ve only been sending these products via SPD and so the $ Savings above are comparing the average shipping cost for the same amount of product to the cost of the LTL. As you can see, we’ve saved a pretty big amount through LTL. Now, at first, we treated this as an absolute truth so we decided to ship our other core product (completely different from those in the first 3 LTL shipments) expecting a similar result. The freight class is going to come into play here real soon. Here’s the data for the subsequent shipments:
|Shipment||Freight Class||% Savings||$ Savings|
As you can see above, we didn’t save a lot of money, we even lost some. The biggest reason we found was related to freight class. Lower freight classes mean higher densities (weight/cu.ft) and vice versa. Simply put, lower freight classes are denser per pallet volume. Upon further research, we found that shipping higher freight classes is more expensive than shipping lower freight classes. So, before you start sending pallets of your products, use a simple freight calculator to see if you would actually save money.
Million-Dollar Product Line Updates
To help us get to $10M, we came up with a new product line relevant to our niche and brand and we set a goal for it to generate $1,000,000 (or 10%) of our revenue. As of January, we were running into trouble getting it on Amazon FBA because of hazmat classifications but as of February, we were able to fully launch our first product in this line. Here are our stats:
- Sales Revenue: $5,308.68
- Unit Orders: 60
- Ad Spend: $1,135.72
- ACoS: 25.91%
- TACoS: 21.39%
With a profit margin of around 55%, this is a pretty great start. Also, these are just Amazon stats and we’ve actually sold a lot more of this product OFF Amazon so far. We did have some trouble getting it going and took 7 days after launching PPC before we got our first sale, but after that it pretty much kept going. Some of the key things that we did that helped boost the product:
- Keep scaling your ads, take advantage of the honeymoon phase when your product is favored by Amazon.
- Keep testing new ads – especially brand ads to see what your audience responds to.
- Cross-sell – a thing we’ve been mentioning the past 2 blogs, but this is incredibly helpful for new product lines that pair well with some of your core products.
- Keep your off-Amazon presence strong – take advantage of social media, setup email offers.
Right now, we’re still continuing to scale our ads and really establish our product in its niche but in the first month, we’ve been able to get over TEN 5-star reviews. I think it’s safe to say WE HIT THE GROUND RUNNING.
We’re also working on 2 new products to add to this line because this alone won’t secure the $1M goal for the product line. We have to keep at it and work on those 8-figure habits to really go far this year.
The Grass is Already Greener in March
It was a pretty slow month for us in February. Couple that with the shorter month (only 28 days) – we didn’t hit our profit goals for the month. There were some challenges that we had to get through, especially with the 3-week suspension of one of our core product lines. With that being said, the end of February did start looking up for us as our daily sales started to increase by quite a lot, our suspended product line got reinstated (again, no real reason why it was down in the first place), AND we’re launching a few more products really soon!
The grass is looking much greener in March, and it is springtime which marks new beginnings for all. We’re hoping to get our strongest month in sales so far this year. And hopefully no bad surprises from Amazon this month *FINGERS CROSSED*.
So, stay tuned for our next update because it’s going to be an exciting month for us as we head into our peak season!
Thanks for joining us on this challenge and I hope we can add some small value to you on your seller journey.
Every month in 2022 we will be releasing these updates and hope to get more detailed and better in our explanations through the year.
Will you join us?
Subscribe to the $10M Challenge to be notified when a new progress update is available
Will you do me a big favor? Forward this to a friend who is looking to grow their Amazon business this year.
Key article insights from our employee and Amazon Brand manager Ken M. You rock Ken!