Growing your Amazon business effectively and profitably is tough enough without worrying about losing cash cow ASINs as they go end of life. This is a challenge every one of our consumer electronics (CE) clients faces. The CE industry is built around regular, iterative product replacement cycles. To manage those challenges and turn them into growth, you must always have parallel plans to maximize the impact of your cash cow product as it gradually retires, while setting the stage for a replacement that is just as successful.
In this post, I’ll explain several considerations and tactics for effective product lifecycle management on Amazon.
What Role Does Your Product Play?
Before you can plan a replacement strategy, you first need to define what role the old product was playing in the market and how to fill that gap with a new product. You can start that process by answering these questions:
- Who is buying the old product, and what are their needs that could be met with a new product?
- Which of your current products or bundles are selling particularly well? Why? How do they differ in components, price, and value proposition from similar products or bundles?
- Do you need to slot in at a similar price point, or can you serve the same customer with a better overall value at a higher price? Successfully increasing the average selling price (ASP) is a great way to reduce transition revenue gaps as the new ASIN is getting up to speed.
- Has the competitive environment changed? Are there new threats or opportunities you can address through a new product?
- How long can the product live an extended life on Amazon – we find some products can add months or even years successfully on Amazon.
Understanding Your Customer is Essential
Ultimately, you need to understand why your customers are so fond of the product. What were their likes and dislikes throughout the out of box and user experience? This is critical for any product transition strategy. In particular with Amazon product lifecycle management, it will significantly impact how you market the new product, what your content will say about the product, and how and where you position it in your brand store. Customer insight research can and should be done a number of ways, including:
- Pre- and Post-purchase surveys – there are many different ways to easily survey your customer base or consumers in general – use them! The most successful brands have proactive strategies to regularly engage in consumer survey research throughout the year.
- In-app engagement and behavior mapping (for app-based products) – data from app usage is a treasure trove of insights if used properly.
- Reading through and understanding customer reviews – doing this in a manual fashion is important. As your business scales, use of AI-based review aggregation and analysis tools can be extremely useful.
- Analyzing returns and reasons for them.
Focus on Inventory Management
One key lesson we have learned in the tumultuous months since March 2020 is just how valuable the in-stock position can be at Amazon and elsewhere in the retail channel. On Amazon, it is all about understanding your sales velocity to the day and making sure your inventory management can absorb a spike in demand.
- Commit to consistently having sufficient stock on hand.
- Overstock best sellers to ensure you never stock out.
- Establish a backup plan to adapt when Amazon changes its maximums or stops taking orders due to external factors.
- Manage the process of forecasting the drawdown of inventory of the old ASIN, including promotional pricing approach, to ensure you move through the inventory, but you do not gap out before the new and improved replacement ASIN not only arrives on the scene but is gathering momentum.
Create Momentum by Mastering Launch 101 Tactics
Making a new ASIN successful on Amazon is not rocket science. It requires patience and a near maniacal focus on the details.
1 – Prepare Creative Assets in Advance
First impressions matter, so make sure you’re ready to put your best foot forward at launch. That goes double for Amazon, where shoppers cannot physically inspect a product before purchase.
Prepare high-quality studio and lifestyle images, product demonstration videos, and any helpful graphics (such as a comparison chart showing how the new product is superior to the old product) before you activate the product detail page.
2 – Prepare Listing Content in Advance
Just as visuals matter, so too does the copy on the product listing. Conduct keyword research using search term reports from Amazon and third-party tools like JungleScout or SEMRush, and review competitor listings and customer reviews from the old product. Integrate your findings into the new product listing’s title, bullet points, product description, and keywords for your Amazon ads. Learn more about this process in this post, “How to Create Fully Optimized Amazon Listings.“
3 – Consider Variation Listings
Of course, there may be cases where you don’t create an entirely new product detail page. In some cases, your new product may be similar enough to the old product that you can create a variation listing. In this case, conducting a keyword audit is still a good idea in case the landscape changed or new product features create new keyword opportunities.
4 – Prepare to Launch Review Generation Programs
Customer reviews are incredibly important, as they function as social proof about a product’s quality and value proposition. Leverage Amazon-compliant tools for review generation, such as Amazon Vine, Early Reviewer programs, Buyer-Seller Messaging, product inserts, and Amazon’s Request a Review feature. You can learn more about such tools in this blog post.
5 – Spotlight the New Product in Your Brand Store
Amazon Brand Stores are highly customizable digital storefronts on the Amazon marketplace. When launching a new product, you can place it front and center on your Brand Store’s home page to maximize its visibility. If you are constantly adding new products to your catalog, you can even include a “New Arrivals” page in your Brand Store to help shoppers discover your offerings and encourage them to check in periodically.
Amazon also released a new tool called “Manage Your Customer Engagement,” which among other things, allows shoppers to “follow” your Brand Store in order to hear about new products or deals.
6 – Launch Amazon Ads
Speaking of Brand Stores, one way you can direct shoppers to them is through Sponsored Brand Ads and Sponsored Brand Videos. Sponsored Brand Ads can be especially useful when launching a new product, as this banner ad includes three products. You can include two established products alongside the new product, effectively letting the new product ride the coat tails of the established products. When shoppers click the ad, you can direct them to your Brand Store or to the respective product listing.
In addition to Sponsored Brand Ads, you should always run Sponsored Product Ads. These are the highest converting ad type on Amazon, making them a must whenever you want to boost sales velocity. These ads resemble normal listings on the search results page, save for a small “Sponsored” label below the image.
7 – Attract Additional Traffic from Off Amazon
Amazon has steadily rolled out updates to its algorithm since early 2020, leading to talk that the “A10 algorithm” is being released incrementally or these updates are leading up to a formal launch. Among other things, A10 is alleged to favor listings that receive external traffic. This means that social media ads can be a powerful tool for boosting not only sales, but also product rank on Amazon. Additionally, social media is a great way to build awareness about new products. Shoppers won’t come to Amazon seeking the latest and greatest iteration if they don’t know that it has been released.
Get Help Managing Product Transitions
Product transitions are an annual ritual in the consumer electronics space. Done properly, they will propel a brand’s growth trajectory both on and off Amazon. If you need help growing your electronics brand on Amazon, including launching new products, Levin Consulting partners with Kaspien to provide expertise for consumer electronics and consumer technology brands. Reach out if you’d like to discuss your business needs.
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