April 18, 2024 • 51 mins
Unlock the secrets to conquering the Amazon marketplace as we sit down with Dan Brownsher, the insightful founder of Channel Key. From his humble beginnings at Ohio State to becoming a powerhouse in e-commerce, Dan's entrepreneurial spirit is a beacon for anyone looking to create a thriving online business. We traverse his story, exploring the pivotal moments and strategic decisions that led to his success. His tales from the Las Vegas conference circuit aren't just about the glitz and glam—they're networking gold mines that have helped shape his business acumen.
Dive deep into the world of Amazon with a guide who has navigated its treacherous waters and emerged victorious. Dan's masterclass in managing an Amazon business provides a roadmap for anyone feeling overwhelmed by the thought of rising fees and fierce competition. He doesn't just talk theory; we get an inside look at the practical tactics and strategies that Channel Key employs to propel brands to the forefront of the marketplace. By dissecting the significance of data analysis and gap analysis, Dan arms you with the tools to carve out your own space in the e-commerce jungle.
In our candid talk, Dan doesn't shy away from the harsh realities of online sales. He lays out the landscape, from the allure of dropshipping to the grind of FBA, giving a clear-eyed view of what it truly takes to succeed. It's not just about the hustle; it's about building something sustainable. Dan's experience offers a reality check for side hustlers and dreamers alike, serving as both a warning and an inspiration. Join us and step into the ring of Amazon commerce with strategies from one of the best in the biz.
As you're inspired to embark on your side hustle journey after listening to this episode, you might wonder where to start or how to make your vision a reality. With a team of experienced marketing professionals and a track record of helping clients achieve their dreams, we are ready to assist you in reaching your goals. To find out more, visit www.reversedout.com.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:04):
Welcome to Side Hustle City and thanks for
joining us.
Our goal is to help you connectto real people who found
success turning their sidehustle into a main hustle, and
we hope you can too.
I'm Adam Kaler.
I'm joined by Kyle Stevie, myco-host.
Let's get started, all right.
(00:24):
Welcome back everybody to theSide Hustle City podcast.
Kyle Stevie is joining viaphone and Dan Brownsher is with
us.
Amazon expert work with ChannelKey, channelkeycom and guys,
we're going to talk a littleAmazon today so everything you
want to know about Amazon.
Dan is a wealth of knowledge andalso spent some time in Ohio.
(00:44):
You used to live in Columbusfor a little while, it sounds
like.
Speaker 3 (00:47):
Yeah, I'm a Buckeye.
Yeah, I grew up in St Louis andthen moved to Columbus to go to
school I'm a Buckeye, proudalum Fisher College of Business.
Lived there for about 13 yearsand then drove out to Vegas and
I've been here for a while now.
So, midwest guy at heart, nice,heart, nice.
So you haven't had to love somegood ohio people there you go,
(01:09):
there you go.
Speaker 1 (01:09):
Do you like skyline chili?
That's the big question.
I don't uh, actually thank you,thank you, thank you yeah I'm
anti skyline yeah, yeah, kyle'sthe one guy who's grown up in
this area who hates Skyline.
Speaker 3 (01:24):
I think it's trash, garbage, it should not be eaten,
and I'm not a fan and I don'trecommend it to anybody.
Speaker 1 (01:32):
What about La Rosa's Pizza?
Have you had La Rosa's?
Speaker 3 (01:35):
I've had La Rosa's.
That's good.
Isn't that also like sweet too?
Speaker 1 (01:39):
It's a little sweet, yep.
Speaker 3 (01:40):
Sweet.
Yeah, it's good.
Speaker 1 (01:45):
We got sweet.
Speaker 3 (01:46):
Yeah, it's good.
We got graders ice cream, wegot all kinds of yummy things.
I know graders.
Yeah, graders is good.
Speaker 1 (01:48):
I like that place yeah so, but now you're in the,
in the warm air.
You don't have to deal withthis ohio cold, cold season.
You don't have to deal with theraininess that we get.
Uh, yeah, you walk outside.
Your glasses fog up in vegasevery day probably, but you're,
uh, you're doing it, man he'sgotta suffer through heat stroke
every fifth day.
Speaker 2 (02:07):
Yeah, 38 degrees outside.
Speaker 1 (02:09):
Yeah, it's, it's rough man.
Yeah.
Speaker 3 (02:11):
Yeah, we get to see the sun through the winter,
fortunately, um, and my glass isnever fogged up because it is.
There's zero humidity here.
Speaker 1 (02:21):
Oh, I'm thinking Dubai.
Speaker 2 (02:22):
I must be thinking Dubai.
Speaker 1 (02:23):
Yeah, if you're in the air conditioning and then
you walk outside, it would justfog right up.
It would be all bad yeah.
Speaker 3 (02:30):
Yeah, so good, good living in Vegas.
I recommend it.
Speaker 1 (02:33):
I like it, man.
So you know there's a lot ofbenefits to being out there too
the fact that I mean, like everyconference is always in Vegas.
So whatever you're into,there's going to be a conference
there at some point and you cango and you can learn stuff, you
can meet people.
It's great networking If you'rethere all the time and, uh yeah
, just don't recommend walkingon the strip and then having to
(02:54):
go over those bridges and thenwalk back up the street just to
go over another bridge.
That's crazy.
Speaker 3 (03:01):
Uh, so I I would agree with that.
In vegas, um is generally notrecommended and things look
closer than they actually are.
Speaker 1 (03:11):
Yes, oh my god, jump in the car, get the uber.
Speaker 3 (03:14):
You know, let's see, things are kind of far and you
don't want to stray too far.
No point, um.
But you're right about yourfirst comment.
There's access to everythinghere All the shows, the category
shows, the, the Amazon shows,the retail shows.
Uh, you can go to the pet showone week and the next week
you're at the home and gardenshow and it's uh, we're very
(03:37):
lucky and very fortunate.
We get a lot of access to a lotof people that come to us, uh,
versus the opposite.
So it's good, good for thetravel budget.
Speaker 1 (03:50):
Yeah, true, and then they leave and yeah, send them
on their way, and if they're, ifthey're unruly, but yeah.
So so tell me, how'd you gofrom Fisher you know Ohio state
Fisher college business how'dyou get into this whole Amazon
thing, Like if you always kindof had that entrepreneurial
spirit?
Speaker 3 (04:02):
Yeah, it's a good question, A good story, and the
answer is yeah, I've always hadan entrepreneurial spirit and,
ultimately, I've always tried tocreate multiple streams of
income.
Speaker 1 (04:18):
Yes.
Speaker 3 (04:18):
Right, whether that's through businesses or through
investments or whatever the casemay be, right.
So you know, trying to createleverage for myself.
Um so um, I graduated, uh, fromthe Fisher college of business.
While in school, over thesummer, I met, I responded to an
(04:39):
ad, um, with the college ofbusiness to to be an intern for
this startup business, and thestartup company was a mobile or
truckside advertising company.
So I went and interviewed withthis guy that I'd never met
before at Starbucks and he was atrue serial entrepreneur, had
(05:04):
started this business out ofcollege, like directly out of
Ohio State, from scratch, had abunch of job offers to go make
some good money, you know, witha larger corporation, but said
nope, I'm going to start thiscompany.
And so I met him, applied to anad for a free intern sales
position and I think I was asophomore in college and I
(05:25):
accepted.
I said I'm going to learn howto do this.
It's truckside advertisingthing.
So first day of work I showed up.
It was in his tiny collegeapartment, my office was his
bedroom and I was, you know,making sales calls sitting on
his bed.
And it was crazy, right, but itwas the summertime and I was
trying to get some goodexperience.
So he became my friend and Imet a bunch of other people
(05:49):
through that experience and thatbusiness actually did well.
I was an intern.
I worked for a little bit andmade a little bit of money and
then graduated from college andthen I immediately started
working in the medical devicespace.
So I worked for this, startedworking in the medical device
space, so I worked for this likebig multinational medical
device business selling spineimplants to neuro and orthopedic
(06:11):
surgeons.
Oh, so I did that, um, and thenin 2008, ish, um, same guy who
started the company that Iworked for as an intern.
We remained friends and he hadstarted this little side
business with his thengirlfriend selling these things
(06:32):
called purse hooks, right.
So for people that have purses,if you don't want to put your
purse on the ground, oh, I'veseen them.
Speaker 1 (06:38):
Yeah, yeah, yeah.
Speaker 3 (06:40):
Like you hang this thing on the table and you can
hang a purse from it.
And so he started source likesourcing these purse hooks in
bulk from uh, from china, likethrough alibaba, and uh, so I
was.
He started doing that and andthen we were actually on a train
in munich, germany, for hisbachelor party, and on that
train I remember it vividly wehad a discussion, said, well,
(07:04):
why don't we do that same typeof business that you and your
future wife are doing, but let'sdo money clips and cufflinks
instead.
The only reason we chose thatwas because, I don't know, it
seems cool.
Maybe it's trending, maybe it'snot, we don't actually know but
it seemed like a good idea.
We said, all right, we starteda company as a total side hustle
, and for me I was like, well,this is my friend, he's a serial
(07:27):
entrepreneur, I want to figureout how to sell stuff on the
Internet.
Let's do this.
So we did it and immediatelyI'm communicating with factories
in China and sourcing cufflinksof all different variations.
Some were violating trademarksor whatever, but lo and behold,
we did it.
You know trademarks or whatever, but lo and behold, we did it.
(07:48):
We spun up a website and andthen started selling these
cufflinks and money clips onebay right, purely as a side
hustle and for me, purely justto learn how to sell stuff on
the internet.
So I was, I had my day job andI was doing well and spend my
time in the operating room andthen, uh, I would pack orders,
people would get these orders onebay and I would pack these
orders up in my basement andthen you know when I could, I
(08:10):
would go to the post office andship these orders out.
Um, total side hustle.
Uh, then I got really busy,couldn't do it.
Uh, it kind of was just thereas uh on the side, my then
partner moved to Las Vegas anduh started going to all these
trade shows in Vegas and buyingmerchandise to sell on the
(08:33):
internet eBay websites and then,ultimately, we found Amazon,
like in 2010, 2009,.
Um started buying brand newmerchandise, selling it on
amazon as a reseller and thebusiness like absolutely
exploded.
Um, so there was like aconsolidation of companies.
We formed this bigger entityand the company like started
(08:56):
really doing well, doublingevery single year for multiple
years in a row, like ink 5000,number one fastest growing
company in nevada, like allthese really cool things.
So what started as a side hustlefor everybody became the main
focus for my one partner, andthen, in 2012, 2013, I said you
know what?
I'm going to go join thebusiness, I'm going to become
(09:18):
active again in the business,and so I did that.
I learned Amazon from theground up, as, on the product
side of things right, likeselling products and quickly
realized that being a reselleron Amazon is was a good business
.
Ok, but there were very minimalbarriers to entry to become a
(09:43):
reseller on Amazon which is oneof the cool things about Amazon
because it's spun up all theseentrepreneurs and so the
strategy of being a resellerstarted to not work, and so we
pivoted Right.
So we started as a private labelseller, sourcing our own
products and selling them underour brand.
Then we became a reseller ofother people's products, and
(10:07):
then we said you know what?
This won't last forever,because we ultimately ended up
just trading commodities onAmazon, which is not a viable
long-term business, at least inour opinion, because we were
buying the merchandise and ifyou buy it, you've got your cash
tied into it.
You need to make margin, and if, all of a sudden, you can't
sell it or you can't sell itprofitably, you've just wasted
(10:27):
your time and energy andresources.
So we said, okay, how do wecreate a moat around this
business and protect itlong-term?
We know Amazon is hot.
We know people are buying stuffon the internet.
How do we craft a businessmodel that can be supportive
long-term?
So we said we're going topursue private label again,
(10:48):
right?
So we own the brand, we own thetrademark, we control the
distribution of the product, wecontrol the pricing.
We get better costing becausewe're getting it directly from
the manufacturer.
And then any brands that we workwith, we want to enter into an
exclusive distributionarrangement with them where we
become the exclusive seller oftheir products on Amazon.
And these are big brands TommyHilfiger, kenneth Cole, like
(11:11):
brands that are well-distributed.
Let us be your exclusive and inexchange for that exclusivity,
we're going to manage yourcatalog on Amazon.
We're going to manage youradvertising on Amazon.
We're going to do yourstorefront on Amazon, right,
we're going to do all thesevalue add services or functions
that are useful for you as abrand and useful for us because
(11:34):
we want to sell more product,right?
And so everybody went to theequation and ultimately, what we
found was, in concept, thatmade sense, but it was really
hard for these brands tomaintain exclusivity and or
clean distribution.
So what?
What ended up happening in alot of cases is we do this deal,
we would buy the inventory,agree to hold price and all
(11:59):
these, and then we have we'd bestill competing against a bunch
of resellers because the brandshad leaks in their distribution
and they couldn't control it.
So and this is a verylong-winded story, adam and I'm
promising you, no, no, this isinteresting, I'm following along
here.
Yeah, so ultimately, you saidyou know what there's value in
providing services to brands,but we don't necessarily want to
(12:20):
have to buy their inventory.
Okay, that model isn't working.
Um, and what?
What?
Most what really works is forthe brand to own their, their
storefront and we become theadministrator to operate their
business and develop theirstrategy and provide all these
cool services and tactics.
Um, but do so in aservice-based model.
(12:42):
Okay, so the product businesswhere we bought inventory
pivoted all the way back toprivate label, right, and then
we said we're gonna create anagency to help other brands
create best-in-class Amazonbusinesses.
And we did that under beta fora year, year and a half.
Beta was successful, and thenwe spun ChannelKey out as a
(13:05):
completely separate company inJanuary of 2017.
So, um, so I ran.
I've been running channel keysince day one, and my two other
partners are running the othercompany.
Um, we ended up selling thatcompany in the summer of 2021.
Um, and so I've been withChannel Key since day one, first
employee since January of 2017,officially.
(13:28):
And today we're a full servicechannel management agency, a
fully remote shop.
I've got about 85 people onstaff all over the world and
we'll power, I don't know.
500 million in GMV throughAmazon this year, 40 to 50
million in media retail mediaspend, and we're some, really,
(13:49):
you know, large companies andbrands and really nice
businesses and we've got just anamazing team of smart
individuals that are all workingtogether to drive businesses on
Amazon.
So that's my, that's my journey.
Speaker 1 (14:04):
Amazon.
So that's my, that's my journey.
So yeah, you've I mean,essentially created like an
Amazon.
An expert Amazon marketingagency is what this has kind of
become, where any company cancome to you say, hey look, I
know I need to be on Amazon.
I have no idea what I'm doing,dan, dan, help me.
Speaker 3 (14:21):
Yeah, that's kind of how it works now, typically so
we've we've evolved over theyears, right.
So in the early days, we wouldwork with smaller sellers that
were launching right, but ofAmazon in most cases, right.
So these are typically brandsdoing anywhere from two to a
(14:48):
hundred million a year on Amazon.
Like that's our sweet spotright now.
Speaker 1 (14:52):
Yeah, yeah, and you're managing all their
advertising and everything else.
I just had a.
I just had a credit card, apoints guy, credit card guy on
my uh, on my show.
Are you, uh, are you using acard?
It's getting you some points,travel points or anything with
that uh ad spend Uh no, we'renot.
Speaker 3 (15:07):
Uh, that's all handled by our clients and run
through Amazon.
So we don't, fortunately, getto manage or run 50 million in
media through our company creditcard.
Speaker 1 (15:20):
You'd have all the points.
You would have all the pointsall the lounge accesses.
Oh man, you'd be living thedream we would own the plane.
Speaker 3 (15:27):
We'd just buy the plane on points, you know.
Speaker 1 (15:31):
You might be better off.
You just go wherever you want,whenever you want.
So, dan, somebody's starting onAmazon now.
I watch all these YouTubevideos, people, and they're
always chasing trends.
They're chasing trends, right.
It's like, oh, what's the nexttrend, what's the next thing,
right?
Uh, you know, now they claimall Amazon's not the thing right
now.
It's this other thing that'sgoing on, it's Tik TOK shops or
(15:53):
whatever, yeah, whateverwhatever it may be, right, uh,
but you could still do a Tik TOKshop and then have stuff link
over to your Amazon store or doAmazon or do TikTok advertising
or whatever and have that linkover to your Amazon store,
whatever the case may be.
But I mean, is it still aviable place to start a business
(16:13):
or is it just so saturated nowthat a small brand, somebody
doing a white label thing I gota, I got a personal trainer,
right, he's we.
I just connected him with acompany that does supplements
Okay, white label supplements.
I busted out some labels forhim for some pre and post
workout, you know, sent it overto my guys who do label printing
(16:33):
and, uh, he should be gettinghis, his supplements, his whole
supply of supplements hereshortly.
Right now, do you recommendsomebody like that?
Get on an Amazon Small brand?
I mean, I know they're out, youknow super small compared to
what you guys are dealing with.
Speaker 3 (16:53):
But what would you recommend they do?
It's a really good question andit's evolved over the years,
right, and I think one of thethings I said earlier is totally
true.
So what's one of the mostamazing things about Amazon, in
my opinion, is they've likedemocratized the ability for
entrepreneurs to set upbusinesses of varying types.
(17:14):
Right, it could be a productbusiness, like you're referring
to.
It could be an agency, likemine, could be a software
company, like there's a lot ofthese, like adjacent businesses
and in categories and verticalsthat have been created because
of Amazon.
Right, super cool.
And they've removed bearishentry, which also means that
it's cool and it's productive,and there's a ton of traffic and
(17:37):
a ton of volume going throughAmazon.
Like 60, 65 percent of allproduct searches on the internet
are starting on Amazon at thispoint.
So it's very much a productdiscovery platform, and I think
they own like 40% of alle-commerce right now in the US
goes through Amazon and 90% ofmarketplace business goes
through Amazon.
It's insane, right, but withall that volume and the lack of
(18:01):
barriers, there's a ton ofcompetition.
There's a ton of competition.
There's a ton of competition.
There's a ton of tools.
There's a ton of data out therethat exists for everybody to be
successful.
Okay, so that's a long-windedanswer of saying that you can.
You can absolutely start anAmazon product business, but in
(18:25):
my opinion, it's harder now thanit's ever been, for a multitude
of reasons.
One is the competition.
Two is, excuse me, it'sexpensive.
Right, amazon's fees go upevery year.
They've created this flywheelwhere it's super easy to do
business, but guess what?
It's a pay to play marketplace.
(18:46):
You got to advertise.
You got to pay Amazonadvertising dollars to
participate.
You've got to use.
Sorry, oh no, did I lose video?
Speaker 1 (18:59):
Yeah, I don't see anymore.
Speaker 3 (19:02):
What happened with me ?
Hold on, oh on oh, you're good,we edited everything anyway I
have this weird ai thing likethat whenever I like do certain
gestures, it creates this likeoh, I see that on on.
Speaker 1 (19:17):
Yeah, it does that on um zoom every once in a while,
my camera will do that.
It'll do some weird shitbecause I got gestures and stuff
that I can do and, um, wheneverI do a certain gesture, it'll
just like shut stuff down forsome reason yeah, but now.
Speaker 3 (19:32):
So for me when I do that, it like freezes for
whatever reason.
So hold on, give me a second.
I'm sorry, guys, are you goodyou?
Speaker 1 (19:47):
Kyle, where are you at right now?
What are you doing?
You had a kids thing, or whatare you up to?
He's in a dead zone yeah, hemust be in a dead zone.
He's driving.
Speaker 2 (20:05):
He must be traveling can you hear me now?
Yeah, I gotcha, I'm going to gojump on my computer while he's
fixing his camera.
He's driving, he must betraveling.
Can you hear me now?
Yeah, I got you All right.
I'm going to jump on mycomputer while he's fixing his
camera.
Okay, go ahead.
That way I can actuallyparticipate a little bit more
then too.
But I mean, so far it's beenpretty awesome.
That was a cool story aboutbasically like the pioneer of
(20:27):
e-commerce.
That was nice.
Speaker 3 (20:29):
Yeah, um well, yeah, it's the truth, so hopefully
that resonates.
Um, I should be back, am I good?
Speaker 2 (20:36):
Yep, you're back, you're back, I'm going to be.
I'm going to be back in likefive seconds.
Speaker 1 (20:40):
Okay, where do you want me to kick back off?
Uh, I can start with thequestion again, and then we'll
just start where I was or yeah,yeah, yeah, you can start over.
Yeah, I'll ask the questionagain and then we can just kind
of I'll cut out the whole otherone.
So so, dan, how do you, howwould you recommend somebody
start today?
You know I watch these.
(21:00):
You know shows on trend chasing.
You know whatever's hot.
And you know, oh, you know,amazon, fba was hot in 2021.
And, uh, you know, tiktok shopsare hot now.
You know how do people start inAmazon.
What do you?
You know small brands.
You know my buddy's personaltrainer he's got his own brand.
(21:21):
You know white labeled.
You know should he sell onAmazon?
Speaker 3 (21:32):
Um, so the?
I think the short answer is yes,okay, but it's, it's.
It's.
It's got to be said and knownthat Amazon is hyper competitive
right now.
They've they've created thisecosystem where entrepreneurs
can spin up these businessesreally quickly and you can have
a product company set up reallyquickly and you have access to
traffic really quickly.
You've got access tofulfillment.
You can do all these things,but it's very competitive and it
(21:55):
can be very expensive, okay.
So you have to.
Amazon's a pay-to-playenvironment.
At this point, you have to usetheir advertising, you have to
use their fulfillment, and thecost to do all those things can
be really high and thepercentage of revenue or sales
to do those things goes up everysingle year, literally every
(22:17):
single year.
It goes up because morecompetition, because you have to
use their fulfillment, and theywant to make more margin
dollars to appease theirshareholders or whatever.
So I think the answer is yes.
There's 60 plus percent ofproduct searches on the internet
start on Amazon and it's a verymuch a brand discovery platform
(22:39):
.
Amazon as a brand name isextremely trustworthy to the
consumer.
There's a hundred plus Primemembers that pay their annual
subscription and your buddy'ssupplement brand.
Well, guess what?
I've got to trust that thisbrand that I've never heard of
before is safe, and I'd bewilling to put this product in
(23:01):
my body, and I've never heard ofthis trainer and I've never
heard of this brand before.
But guess what?
I trust Amazon, right, and Itrust the reviews on Amazon and
I trust that if I don't likethis product, I can return it
with no problem and I trust thatI'm going to get it in one to
two business days, right.
So that ecosystem is hard toreplicate.
(23:23):
If your buddy was trying tobuild his own Shopify website
and create his own brand, that'shard.
It's really expensive, okay.
So the cool thing about Amazonis the traffic is already there,
but it's hard and it'scompetitive.
So my opinion, you canabsolutely do that.
But today, to launch a brand,if I were to do it from scratch,
(23:43):
I would very much have toincorporate social media into
the environment, and whetherthat's through TikTok and TikTok
shop is actually good forsupplements, right?
There's a few good categorieson TikTok beauty, health, right,
Wellness and fashion so thatmight be a good place.
I would always supplementAmazon with social media and or
(24:09):
TikTok shop.
At this point to leverage,don't put your eggs and all your
eggs in one basket on Amazon?
You can't, and you got to beable to drive traffic in various
ways and it cannot just lean onAmazon to find all your
customers for you.
Speaker 1 (24:28):
When this is one of the things you do, I mean with
your businesses.
You help with SEO.
You help you know, say, saysomebody's got a Shopify site
and I we do websites for youknow a living here, right?
We have an agency for 13 yearsand most people are going to go
on Shopify and they're going tocreate a crap website.
They're going to build it.
It's going to be ugly as sin.
(24:54):
Their photography is going tobe absolute garbage and they
don't know what they're doing.
And you know their SEO is goingto be nasty too, because none of
their images are going to beoptimized.
Obviously, they're all going tobe named image zero, two, three
, four, five dot JPEG andthey're not going to have any
metadata on them.
So they're not going to havetitles, descriptions, nothing,
because nobody knows how to dothat.
Right, they?
Unless you build websites andyou understand how this stuff
works, you really don't know howto optimize your own website,
(25:17):
let alone get paid advertisingand manage that paid advertising
.
So explain a little bit abouthow you guys help people like my
buddy who's a trainer, and Iknow you work with much bigger
brands, but is there, is therean opportunity to work with some
of these smaller brands withyour agency and how would you
help them?
Speaker 3 (25:35):
Yeah, so what we do, um, based upon what I heard that
you guys do, I think it's verysimilar, right, but the
difference is is we just do itwithin the Amazon environment,
right?
So if you think about a brandthat sells on Amazon and you can
pick any brand, I don't knowNike.
Nike has an Amazon storefront.
(25:59):
Nike has a bunch of productlisting pages or product detail
pages on Amazon that have photos, that have a title, that have
bullet points, that havedescriptions, that have A plus
or HTML content, right?
Furthermore, you have toadvertise, right, and the
(26:22):
options and choices foradvertising and leveraging of
retail media on Amazon arereally they're endless.
There's so many options at thispoint.
Okay, so you've got the SEOelements right.
So A Amazon's a giant searchengine.
You want to make sure thatpeople can find your product,
okay, and you do that throughtraffic driving or indexing or
(26:47):
placement in their searchalgorithm, and then, once you
get them to your product detailpage, they have to convert,
right, and you do that with goodcontent and telling a good
story and having good reviewsand, you know, putting product
videos in there and the FAQ andall these, all these things,
right.
So we do all that work andthere's a lot of strategy around
(27:09):
that and every category isdifferent and the life cycle of
the product is important, andthe budget is important, and the
profitability of the categoryis important.
And then, guess what?
There's all these other thingsthat have to be done, also on
Amazon.
There's a whole back end, right.
There's a lot of accountmanagement.
There's a lot of technicalthings that have to happen.
If your buddy wants to sell onAmazon, guess what?
(27:30):
He's not going to be allowed tosell supplements right away on
Amazon.
He's going to have to gothrough a process to get ungated
or to get approval to sell thatproduct type.
Not easy, right?
Exactly Setting up fulfillmentyour ops there's a process to
that.
Setting up fulfillment your opsthere's a process to that.
So there's a lot of behind thescenes work that gets done, and
Amazon is hard sometimes to workwith.
(27:55):
You can't just pick up thephone, call somebody and say hey
, Amazon.
I've got this issue.
Can you help me fix it?
They don't do that.
It's not how it works.
No, so you've got to know howto navigate and a lot of their
system is archaic and clunky andstill from the old days and
they're, you know, marrying itwith with some of the newer
streamlined tech and interface,and it's hard, right, it's
(28:15):
really hard.
So that's where we come in.
Right, we start in most caseswith strategy.
Right, let's build you abusiness plan that helps you get
from A to B.
And what does that mean?
At the product level, it couldbe different for all the
products, right.
And how many SKUs do you have?
Do you have one ASIN, one SKU,or do you have 10,000 SKUs?
(28:36):
Strategy's different, right.
So that's what we do.
Right, full service channelmanagement agency and like eight
or nine different people touchour client accounts in a given
month.
They can be doing graphicdesign, they can be writing copy
, they can be doing ads, theycan be doing DSP We've got our
own DSP seat with Amazon.
They can be doing forecasting,analytics, account management.
(28:59):
So that's where we come in.
So, typically, what we've seenis entrepreneurs that are able
to create these Amazon brandsright, where their primary
distribution is through Amazoncan do really well, okay, and
they can grow and they candevelop and at some point they
they tap out right and if theyhave the chops to actually run a
(29:20):
product company and maintainpositive cashflow which is
really hard and a hard lesson tolearn for a lot of people At
some point they need moresophistication, and that's where
we come in.
Speaker 1 (29:34):
So and now, who are you looking to work with?
Like what, what?
When do people come to you?
Where are they at with theirannual revenue?
Is that what you're looking at,or are you looking at some
different figures?
Are you just looking at atannual revenue?
Are you looking at net?
Are you looking at like what,EBITDA?
Like what are you guys lookingat?
Speaker 3 (29:51):
Yeah, good question.
So we typically work with SMBsand enterprise level brands that
have distribution outside ofAmazon.
Right, they could be sold inNordstrom's or Dick's sporting
goods or in Whole Foods orwhatever.
We're generally categoryagnostic.
Okay, we like all categories.
We love consumables as acategory and they are typically
(30:14):
doing already anywhere from twoto a hundred million dollars a
year and sales through Amazon.
That's kind of our, that's kindof our sweet spot.
So that's where we target,that's who we go after.
That's you know the content weput out and my sales team and
biz dev team that's.
Those are the folks that wetalk to.
Speaker 1 (30:35):
Yeah, and I you know what I like your web.
I like your website and I'lltell you why.
And I think other people ifthey go to your website,
channelkeycom and you know we'rein a consumer products capital
of America, probably you are.
Yeah yeah, procter Gamble here,you got Kroger here, you got the
largest consumer packaged goodscompany and the largest grocery
chain in the same city together, and then you have the largest
(30:58):
Amazon hub in the world innorthern Kentucky's airport,
right down the street.
So yeah, and a large DHL huband a large Wayfair hub and a
lot.
I mean we've got.
We've become this like consumerpackaged goods logistics city,
what I like.
Uh, I mean so it's great.
I mean we get discounted crapall the time, like there's
websites bid FTA and all thatstuff and I mean you could drive
right down here to a warehouseand pick up a dryer and still
(31:21):
wrapped up in plastic for 200bucks.
You know, I mean it's prettyamazing and there are a ton of
things like if you're in thatworld and Kyle here on the call
with this is a freight brokerand you realize how much stuff
just gets, it's cheaper for themjust to sell it on one of these
sites and it is.
You know, you got returns andall that other crazy stuff going
(31:42):
on and I mean you've got somuch waste in this world and
people return and stuff and it'sjust it's tough, but what I
like I was going to say, what Ilike about your website is if
somebody is building a site,you've got you're building a
Shopify site or you're buildinga site for any, any product.
You've got a great top offunnel strategy here where
(32:03):
you've got this schedule, yourfree report.
Now your brand audit.
Which people look at this?
Any of these brands?
Procter, gamble if you'relistening to this right now,
this is really interesting.
So find new Amazon customersfor free.
You get Amazon share, voice,category, market share, growth
opportunities.
I mean, this sounds like acrazy comprehensive report for
(32:26):
somebody and you're getting thisfor free, which then leads them
into that next step with youguys.
Speaker 3 (32:34):
Adam, can I hire you?
That's great.
Yeah, we just did our.
We redid our website last yearand Kristen on my team will be
thrilled to hear your positivefeedback on it.
We spent a lot of time andenergy and effort on it and,
yeah, I think what we like to dois educate, if we can.
(32:56):
It can be really challenging anddaunting to operate on the
platform for reallywell-established larger
companies and smaller sellers,and so, for us, the way we can
educate is through data andconsuming data and and,
ultimately, communicating whatthe data means to, uh, to
different companies and brands.
So we love to do it.
(33:17):
It helps us understand, um,where the pain points are and
where the opportunities are.
It's really a gap analysis,right?
Yes, uh say, hey, you know, andsometimes folks we talk to are
doing an amazing job and theyfrankly, don't need our help.
And other times we see it andwe're like, hey, there's like 12
things you need to do right nowto fix what's happening and to
(33:37):
and to make this business better.
So that's what it's meant to dois we want to talk to people
and be helpful and, obviously,find new clients and customers
and, uh, one of the ways we dothat is through auditing
businesses and providingcompelling data and information
to folks.
Speaker 1 (33:54):
Yeah, I mean, if I'm an assistant brand manager on
Tide or Gillette or you know,dreft, I look at this and I say,
oh wow, look at this, they'redoing my work for me.
I can get this report and thenI could take this up the ladder
and show them how smart I am.
And oh, by the way, uh, I'mworking with this company
channel key that put thistogether for me.
(34:14):
Oh, how much did you pay for it?
Nothing, oh, wow, let's, let'sget started, let's figure this
out, like they can see.
I mean there was a lot of workthat goes in.
I'm reading this list here.
I mean this is a tremendousamount of work you're giving
away just for the opportunity towork with some of these guys.
Speaker 3 (34:31):
Yeah, that's a good point, yes, and we're happy to
do it, and we've got some of thebest technology partners out
there that work in our ecosystem, right, and so part of this is
we know what the data, we knowthe data, we know what to look
for.
We know not what not to lookfor, but we also have access to
(34:51):
the information, and we do thatthrough a lot of our technology
partners and our ability to kindof aggregate, and so we can do
it at scale, right, and ingeneral, that's a reason why
somebody would hire an agencylike us or like you is because
we can theoretically do itbetter, faster and for cheaper,
(35:11):
right, and we've got the techstack already in place, oh yeah.
So, yeah, that's our business,we're happy to do it.
Speaker 1 (35:18):
Well, and I used to do graphics at an agency I used
to work for back before Istarted my own thing, and we
used to build Amazon stores forpeople.
But I would, I would be the onethey you know, you'd have your
copywriter and they would bewriting all the content and then
they check with the SEO guy andmake sure everything was good.
Did I get all the keywords inthere?
And then they hit me up and say, hey, Adam, we need a graphic
(35:40):
this big for this.
Here are all the sizes.
And I'd get a list, an email,of like 50 different graphics I
needed for all these differentthings and for all the products.
And there's different sizes foreach product depending on what
screen they're looking at.
And it gets kind of wild.
And if you own an Amazon storeand if you're a a brand, most of
the time they're going to hirean agency like the agency I used
(36:01):
to work with, or they're goingto hire somebody like you who I
feel like can do a lot more.
There we were just doinggraphics and write copy, but
who's who's managing everything,who's making and who knows what
they're doing out here?
I mean, it sounds like you guysare the the.
Speaker 3 (36:18):
You guys are the the one we've been doing it for a
long time, right, and you know,I think one of the things that
that's unique about us is webuilt our own business, like we
built our own product businesson Amazon ourselves, right, we
sourced all the inventory, wewarehouse the inventory, we
packaged it, we labeled it forAmazon, and we made a ton of
(36:38):
mistakes over the years and wedid that.
As for our clients today don'thave to, right?
So we didn't just learn it onYouTube, we didn't take a course
and we actually did it, yeah,and so, uh, we know how to do it
and we get into the weeds andwe do things that most people
don't do or don't want to do,because it's sometimes it's
(36:58):
unsexy, um, or they just, orit's hard, right, but in our
view of the world, like youcould have the most amazing ads
strategy in the world on Amazon,right, but if you can't keep
your products in stock, if youcan't do the basics and the
fundamentals and operate acompany in that ecosystem, it
(37:18):
doesn't matter, right?
So we, that's why we take thatholistic approach to full
service approach, because wewant to control really all the
key elements that are requiredto to run a store like that, um,
and the reason we know how todo it is because we've done it
ourselves.
Speaker 1 (37:34):
Well, and I mean you, you know not everybody's going
to have side hustlers out herearen't going to have, you know,
the Fisher MBA you know they'renot going to have done.
You know, grown up in Amazon,essentially Like I mean this is
what I mean, you've been doingit long enough.
I mean you've essentially grownwith Amazon and you know you
were early, you were able topivot with Amazon, pivoting and
(37:56):
understand what's going on forfor the new side hustler out
there.
What are some of the mistakesthat you see people making today
?
Uh, what are some of the placesyou would recommend them?
Should they do FBA?
Should they be doing dropshipping type stuff and explain
even what that is?
People don't even know whatthat is on this podcast.
Where are the opportunities atright now?
(38:16):
You think?
Speaker 3 (38:23):
Yeah.
So my mindset always goestowards how do I build a
sustainable business right thatcan function well over time,
versus trying to make a quickbuck right, and how do I create
leverage for myself?
One of the easiest thingspeople can do is create a
(38:44):
dropship business right, andbasically what that means is you
can create a relationship withsome sort of supplier of a
product right or productssupplier of a product right or
products and you can list thoseproducts for sale on Amazon and
have uh, whereas you are theseller right.
So if Adam wanted to create hisown Amazon business, you could
(39:06):
call it Amazon's or Adam's.
You know Adam's stuff and he'sthe seller of record on Amazon
and what he's selling isactually through a catalog of
products that he doesn'tactually own.
He's never bought it, okay.
So if somebody comes throughand buys that particular item,
what Adam would do is he wouldsend the order to his supplier
and the supplier would ship theitem directly to the customer.
(39:30):
Right, and that's a drop shiporder.
So Adam didn't have to buy theinventory.
He didn't have to store theinventory.
You have to do anything.
All he did was broker the dealand he gets a commission paid to
him by the supplier and he paysAmazon a commission right.
So you don't need a lot ofcapital for that, you don't need
a lot of resources andinfrastructure.
(39:51):
But that's a really hard model,right and in essence, sounds
easy, right, sounds all fly.
Speaker 1 (39:59):
All I got to do is make a sale.
Speaker 3 (40:00):
Oh yeah, yeah, easy peasy, right, but the problem is
is that a lot of people aretrying to do that and you're not
actually adding value toanybody in the value chain.
In my opinion, right, what wetell our brands is you should be
selling direct to consumer.
There's no need to distributeto anybody else or to have your
products be sold by anybody elseon Amazon except for you, okay.
(40:23):
So what value is the brokerproviding in that scenario?
Right, in my opinion, it's veryminimal.
You're just brokering thetransaction, right, people are
creating the value, are thesupplier, the brand and Amazon.
So and I don't believe that'ssustainable long-term business
(40:44):
model and it's not thatprofitable, okay, so the other
option is you can become areseller, so actually buying
other people's products, storingthem, stocking them, putting
them in FBA and shit and sellingthem.
That way, viable businessrequires capital, right, you
have to buy the inventory, okay,and you have to store it, and
you might get stuck with it.
And if you are, I don't know,the third or fourth person
(41:07):
that's actually buying thatinventory from the manufacturer,
right?
If you're like the fourthremoved person from the
manufacturer, guess what?
Everybody along the way isdoubling their money, right?
So you're paying a very highprice for that item to be a
reseller.
Amazon's costing model isreally high.
You're not going to make anymoney.
(41:27):
Like there is very there's avery high likelihood that after
all is said and done, after youpay for the ads or pay for the
fulfillment, you're not going tomake any money.
Speaker 1 (41:37):
And these are brands that are already popular, you
know, like the tides of theworld or whatever, and it's.
I know that to sell a productlike that, with a strong brand,
unless you know what you'redoing on Amazon, you're not even
going to be able to sell that.
Speaker 3 (41:49):
They might not let you sell it.
A and B.
Even if you are able to sell it, you're going to pay too much
for it, to where you're notgoing to be able to make any
money on the back end.
Now some people do thatbusiness and it's viable and
they're really smart and theysqueak out thin margins.
But they know how to do it andthey've got these amazing
relationships built withsuppliers.
(42:09):
They've got buying power, theyhave scale where they can buy in
bulk and maybe get betterpricing, better payment terms,
et cetera.
But you've got to build to that, and so there's that model.
The other model is you can buildyour own brand, right, private
label.
Right, that's where you'regoing to get the best costing.
Right, you're going to controlthe distribution.
You don't have to deal with themiddleman.
Theoretically, you're dealingdirectly with the manufacturer,
(42:32):
maybe a contract manufacturer.
But guess what?
Nobody knows who you are.
Right?
They've never heard of yourbrand, they've never heard of
what you sell.
Why would they trust it?
Right?
So the model to build abusiness like that is completely
different.
Right?
You then have to tap in to thetraffic on Amazon and, opposed
(42:54):
to having people directly searchfor your brand on Amazon, they
have to search for some genericsearch term.
Okay, you brought up apre-workout.
Cool, I'm going to searchpre-workout.
Well, how do you get your buddysupplement that nobody's ever
heard of before, that has notraction, no reviews, no
conversions, to index an Amazonsearch algorithm for pre-workout
(43:16):
?
Really hard.
Speaker 2 (43:17):
Real hard and really expensive.
Speaker 3 (43:19):
And you're probably going to end up on page 12 of
search results, right, and inreality, you need to be on the
top half of page one.
That's where all the action'shappening.
So there's a different strategy.
Right, you got to pay for thebusiness.
You got to be willing to losemoney.
You're going to have to drivefor the business.
(43:39):
You got to be willing to losemoney.
You're gonna have to drivesocial traffic and you're going
to have to get on TikTok shopand hopefully create some good
videos.
You get some traffic going inand or be able to absorb just
the amount of money it's goingto take to launch a new brand,
right, but it's totally viable,it's doable and people do it,
and so the thing I'd have to beI would caution people around
being careful of isunderstanding your cashflow
model.
(44:01):
Okay, just because you sell$100,000 worth of product on
Amazon doesn't mean you get$100,000.
At all, and it doesn't meanyou're ever going to get it, and
if you get it, it's not goingto happen right away.
So, to continue on with abusiness like that, you've got
to continually leverage yourcashflow to buy more inventory,
(44:21):
and some people don't know that,especially young entrepreneurs,
right, they're like man, I justsold $100,000 worth of stuff.
Why is my bank account in thenegative Right?
And that's the reality is youneed to understand your
operational and cashflow modelto be able to continually
sustain a business like that.
And that's the reality is youneed to understand your
operational and cash flow modelto be able to continually
sustain a business like that.
And it's hard and it's risky.
Speaker 2 (44:40):
Yeah.
Speaker 3 (44:40):
So, but it's doable and there's a ton of data out
there and you can do productresearch and you can find all
these really cool opportunities.
And if you're one of the luckyones that finds that white space
, you have to pounce on it fastand build the momentum fast,
build the reviews fast, get thetraffic going fast, because
chances are, if you found anarea of white space that it uh,
(45:03):
it will be um, you will bebombarded with competition very
quickly.
Speaker 1 (45:08):
Oh yeah, yeah.
I mean there's millions andmillions of people selling on
Amazon, so and and a lot ofthose people in other countries
and they have all kinds of timeto do it and they have cheap
labor that's doing it for themand all kinds of stuff like that
.
So I mean, what do you thinkabout affiliates?
I mean, do you guys use anaffiliate strategy for some of
your stuff?
Do you have a list ofinfluencers that you reach out
(45:28):
to when you're trying to pushsomething like that?
Speaker 3 (45:31):
Yeah yeah.
Affiliates are good,influencers are good.
No-transcript, the rightaffiliate, and you've got to
(46:07):
make sure that your product typelines up with their audience
and that you can strike a gooddeal.
That makes sense.
It's absolutely one of the manytraffic driving options that
brands can consider.
Speaker 1 (46:21):
So you just mentioned a lot of different strategies
advertising strategies, right,yeah, yeah.
But you also have to understandand this is one of the values
of going with someone like youversus trying to figure this
stuff out on your own thingsthat you've learned how to do
over the years, right, andyou've again, you've matured, as
amazon has matured.
But also, you said somethingearlier about categories being
(46:45):
popular on certain platforms.
Now we all know at least weshould that there are a handful
of categories in general thatsell well on social media, right
, right, health and wellness isprobably the most popular
supplements, things like thatPeople love that.
Beauty, weight loss, you knowall that kind of stuff.
Another thing you have toconsider is not only these
(47:10):
advertising channels, but whatworks on those advertisers.
So what are you selling?
Where can I put my dollars?
That they're most effective,right.
And what's the old saying?
50% of my advertising is wasted.
Advertising dollars are wasted.
I just don't know which 50%.
Speaker 3 (47:25):
Yeah, yeah, you can exactly.
So, um, it's hard, right, andyou've got to piece together
that strategy, um and um, and itchanges quickly.
Yeah Right, the dynamic canchange quickly and it's
different for every category,product type and, uh, and life
cycle of a brand and or aproduct.
Speaker 1 (47:46):
Yeah, can you, dan, can you just have like a YouTube
channel or something where youyou teach young, uh, aspiring
e-commerce sellers to, to, tothe tricks of the trade early on
?
I mean, you guys are doinggreat Cause.
You know you're, you've gotthese like larger companies that
you're working with and you'rekind of you know you could coast
now.
I mean, obviously everybody'salways looking for more business
(48:08):
, but you know, the smaller guys, the people that, uh, that
don't know what's going on, someof the tips you've shared here,
some of the stuff you've putout here that they may not be
familiar with.
You know, I'm in a brand cityso I obviously I get everything
you're saying, but most peoplearen't right.
Most people are just like JoeSchmo that lives out and you
know wherever in the middle ofnowhere and hasn't ever worked
(48:28):
in advertising in their entirelife.
Where do they go for tips?
Where do they go?
Is there a company or somethingthat you guys work with for the
lower level guys until they canbuild up to where you're at?
Speaker 3 (48:38):
So it turns out, we do have a YouTube channel and
you'll find us on YouTube, andalso we're super active on
LinkedIn.
Whether that's me or thecompany, you can find me on
LinkedIn.
And yeah, we, we've got a bunchof partners that we work with
that if, if, if, we're not theright fit for a business, for
whatever reason, we always liketo refer people out to trusted
(49:01):
partners.
So, yeah, we'll evaluate andhelp anybody we can, but if it
doesn't make sense, we've got alist of folks that we can refer
out to.
It just depends on thesituation.
So we're happy to chat withanybody.
Look at anything, and if itrequires us to push it out
elsewhere, we'd happy to chatwith anybody.
Look at anything, and if it, uh, requires us to, you know, push
it out elsewhere, we'd love todo that I love it.
Speaker 1 (49:21):
Man, dan, tell, tell people how they find all this
stuff and I will put some linksin the, in the, in the
description at the end of here.
But uh, you know, for thepeople listening, uh, tell them
how they can find you.
Speaker 3 (49:32):
Yeah, so you can go to our website, uh,
wwwchannelkeycom.
Check out our cool website, asAdam mentioned.
Uh, you can find me on LinkedInto search my name, dan, on
LinkedIn, or search channel keyon LinkedIn.
Uh, or you can find us onYouTube also by searching
channel key.
So we're everywhere.
I love it man.
Speaker 1 (49:52):
Well, I appreciate you spending the time here.
I know you're a busy guy.
You've got, you know, these bigbrands you guys got to manage
and that takes up a lot of time.
And enjoy Vegas, man, I'm gladyou're there.
You're in the warm air.
You don't have to deal withthis misty rain all the time and
you never know if it's going tobe 90 degrees outside or 45
degrees outside here.
(50:13):
It's uh, I don't know what it'sgoing to be when I walk outside
right now.
Speaker 3 (50:16):
So we'll see Good Godspeed, Adam, Good luck to you
.
I love, I love Ohio, Goodpeople, Um, but you're right, I
think the vague, I choose theVegas weather.
So uh, appreciate you having meon.
It's great to great to meet youand uh, uh love spending the
time together.
Speaker 1 (50:35):
Awesome man.
I appreciate it.
Thank you, Thanks, Thanks forjoining us on this week's
episode of Side Hustle City.
Well, you've heard from ourguests.
Now let's hear from you.
Join our community on Facebook,Side Hustle City.
It's a group where people shareideas, share their
inspirational stories andmotivate each other to be
successful and turn their sidehustle into their main hustle.
(50:57):
We'll see you there and we'llsee you next week on the show.
Thank you.
Speaker 2 (51:21):
Bye.
Welcome to Side Hustle City and thanks for
joining us.
Our goal is to help you connectto real people who found
success turning their sidehustle into a main hustle, and
we hope you can too.
I'm Adam Kaler.
I'm joined by Kyle Stevie, myco-host.
Let's get started, all right.
(00:24):
Welcome back everybody to theSide Hustle City podcast.
Kyle Stevie is joining viaphone and Dan Brownsher is with
us.
Amazon expert work with ChannelKey, channelkeycom and guys,
we're going to talk a littleAmazon today so everything you
want to know about Amazon.
Dan is a wealth of knowledge andalso spent some time in Ohio.
(00:44):
You used to live in Columbusfor a little while, it sounds
like.
Speaker 3 (00:47):
Yeah, I'm a Buckeye.
Yeah, I grew up in St Louis andthen moved to Columbus to go to
school I'm a Buckeye, proudalum Fisher College of Business.
Lived there for about 13 yearsand then drove out to Vegas and
I've been here for a while now.
So, midwest guy at heart, nice,heart, nice.
So you haven't had to love somegood ohio people there you go,
(01:09):
there you go.
Speaker 1 (01:09):
Do you like skyline chili?
That's the big question.
I don't uh, actually thank you,thank you, thank you yeah I'm
anti skyline yeah, yeah, kyle'sthe one guy who's grown up in
this area who hates Skyline.
Speaker 3 (01:24):
I think it's trash, garbage, it should not be eaten,
and I'm not a fan and I don'trecommend it to anybody.
Speaker 1 (01:32):
What about La Rosa's Pizza?
Have you had La Rosa's?
Speaker 3 (01:35):
I've had La Rosa's.
That's good.
Isn't that also like sweet too?
Speaker 1 (01:39):
It's a little sweet, yep.
Speaker 3 (01:40):
Sweet.
Yeah, it's good.
Speaker 1 (01:45):
We got sweet.
Speaker 3 (01:46):
Yeah, it's good.
We got graders ice cream, wegot all kinds of yummy things.
I know graders.
Yeah, graders is good.
Speaker 1 (01:48):
I like that place yeah so, but now you're in the,
in the warm air.
You don't have to deal withthis ohio cold, cold season.
You don't have to deal with theraininess that we get.
Uh, yeah, you walk outside.
Your glasses fog up in vegasevery day probably, but you're,
uh, you're doing it, man he'sgotta suffer through heat stroke
every fifth day.
Speaker 2 (02:07):
Yeah, 38 degrees outside.
Speaker 1 (02:09):
Yeah, it's, it's rough man.
Yeah.
Speaker 3 (02:11):
Yeah, we get to see the sun through the winter,
fortunately, um, and my glass isnever fogged up because it is.
There's zero humidity here.
Speaker 1 (02:21):
Oh, I'm thinking Dubai.
Speaker 2 (02:22):
I must be thinking Dubai.
Speaker 1 (02:23):
Yeah, if you're in the air conditioning and then
you walk outside, it would justfog right up.
It would be all bad yeah.
Speaker 3 (02:30):
Yeah, so good, good living in Vegas.
I recommend it.
Speaker 1 (02:33):
I like it, man.
So you know there's a lot ofbenefits to being out there too
the fact that I mean, like everyconference is always in Vegas.
So whatever you're into,there's going to be a conference
there at some point and you cango and you can learn stuff, you
can meet people.
It's great networking If you'rethere all the time and, uh yeah
, just don't recommend walkingon the strip and then having to
(02:54):
go over those bridges and thenwalk back up the street just to
go over another bridge.
That's crazy.
Speaker 3 (03:01):
Uh, so I I would agree with that.
In vegas, um is generally notrecommended and things look
closer than they actually are.
Speaker 1 (03:11):
Yes, oh my god, jump in the car, get the uber.
Speaker 3 (03:14):
You know, let's see, things are kind of far and you
don't want to stray too far.
No point, um.
But you're right about yourfirst comment.
There's access to everythinghere All the shows, the category
shows, the, the Amazon shows,the retail shows.
Uh, you can go to the pet showone week and the next week
you're at the home and gardenshow and it's uh, we're very
(03:37):
lucky and very fortunate.
We get a lot of access to a lotof people that come to us, uh,
versus the opposite.
So it's good, good for thetravel budget.
Speaker 1 (03:50):
Yeah, true, and then they leave and yeah, send them
on their way, and if they're, ifthey're unruly, but yeah.
So so tell me, how'd you gofrom Fisher you know Ohio state
Fisher college business how'dyou get into this whole Amazon
thing, Like if you always kindof had that entrepreneurial
spirit?
Speaker 3 (04:02):
Yeah, it's a good question, A good story, and the
answer is yeah, I've always hadan entrepreneurial spirit and,
ultimately, I've always tried tocreate multiple streams of
income.
Speaker 1 (04:18):
Yes.
Speaker 3 (04:18):
Right, whether that's through businesses or through
investments or whatever the casemay be, right.
So you know, trying to createleverage for myself.
Um so um, I graduated, uh, fromthe Fisher college of business.
While in school, over thesummer, I met, I responded to an
(04:39):
ad, um, with the college ofbusiness to to be an intern for
this startup business, and thestartup company was a mobile or
truckside advertising company.
So I went and interviewed withthis guy that I'd never met
before at Starbucks and he was atrue serial entrepreneur, had
(05:04):
started this business out ofcollege, like directly out of
Ohio State, from scratch, had abunch of job offers to go make
some good money, you know, witha larger corporation, but said
nope, I'm going to start thiscompany.
And so I met him, applied to anad for a free intern sales
position and I think I was asophomore in college and I
(05:25):
accepted.
I said I'm going to learn howto do this.
It's truckside advertisingthing.
So first day of work I showed up.
It was in his tiny collegeapartment, my office was his
bedroom and I was, you know,making sales calls sitting on
his bed.
And it was crazy, right, but itwas the summertime and I was
trying to get some goodexperience.
So he became my friend and Imet a bunch of other people
(05:49):
through that experience and thatbusiness actually did well.
I was an intern.
I worked for a little bit andmade a little bit of money and
then graduated from college andthen I immediately started
working in the medical devicespace.
So I worked for this, startedworking in the medical device
space, so I worked for this likebig multinational medical
device business selling spineimplants to neuro and orthopedic
(06:11):
surgeons.
Oh, so I did that, um, and thenin 2008, ish, um, same guy who
started the company that Iworked for as an intern.
We remained friends and he hadstarted this little side
business with his thengirlfriend selling these things
(06:32):
called purse hooks, right.
So for people that have purses,if you don't want to put your
purse on the ground, oh, I'veseen them.
Speaker 1 (06:38):
Yeah, yeah, yeah.
Speaker 3 (06:40):
Like you hang this thing on the table and you can
hang a purse from it.
And so he started source likesourcing these purse hooks in
bulk from uh, from china, likethrough alibaba, and uh, so I
was.
He started doing that and andthen we were actually on a train
in munich, germany, for hisbachelor party, and on that
train I remember it vividly wehad a discussion, said, well,
(07:04):
why don't we do that same typeof business that you and your
future wife are doing, but let'sdo money clips and cufflinks
instead.
The only reason we chose thatwas because, I don't know, it
seems cool.
Maybe it's trending, maybe it'snot, we don't actually know but
it seemed like a good idea.
We said, all right, we starteda company as a total side hustle
, and for me I was like, well,this is my friend, he's a serial
(07:27):
entrepreneur, I want to figureout how to sell stuff on the
Internet.
Let's do this.
So we did it and immediatelyI'm communicating with factories
in China and sourcing cufflinksof all different variations.
Some were violating trademarksor whatever, but lo and behold,
we did it.
You know trademarks or whatever, but lo and behold, we did it.
(07:48):
We spun up a website and andthen started selling these
cufflinks and money clips onebay right, purely as a side
hustle and for me, purely justto learn how to sell stuff on
the internet.
So I was, I had my day job andI was doing well and spend my
time in the operating room andthen, uh, I would pack orders,
people would get these orders onebay and I would pack these
orders up in my basement andthen you know when I could, I
(08:10):
would go to the post office andship these orders out.
Um, total side hustle.
Uh, then I got really busy,couldn't do it.
Uh, it kind of was just thereas uh on the side, my then
partner moved to Las Vegas anduh started going to all these
trade shows in Vegas and buyingmerchandise to sell on the
(08:33):
internet eBay websites and then,ultimately, we found Amazon,
like in 2010, 2009,.
Um started buying brand newmerchandise, selling it on
amazon as a reseller and thebusiness like absolutely
exploded.
Um, so there was like aconsolidation of companies.
We formed this bigger entityand the company like started
(08:56):
really doing well, doublingevery single year for multiple
years in a row, like ink 5000,number one fastest growing
company in nevada, like allthese really cool things.
So what started as a side hustlefor everybody became the main
focus for my one partner, andthen, in 2012, 2013, I said you
know what?
I'm going to go join thebusiness, I'm going to become
(09:18):
active again in the business,and so I did that.
I learned Amazon from theground up, as, on the product
side of things right, likeselling products and quickly
realized that being a reselleron Amazon is was a good business
.
Ok, but there were very minimalbarriers to entry to become a
(09:43):
reseller on Amazon which is oneof the cool things about Amazon
because it's spun up all theseentrepreneurs and so the
strategy of being a resellerstarted to not work, and so we
pivoted Right.
So we started as a private labelseller, sourcing our own
products and selling them underour brand.
Then we became a reseller ofother people's products, and
(10:07):
then we said you know what?
This won't last forever,because we ultimately ended up
just trading commodities onAmazon, which is not a viable
long-term business, at least inour opinion, because we were
buying the merchandise and ifyou buy it, you've got your cash
tied into it.
You need to make margin, and if, all of a sudden, you can't
sell it or you can't sell itprofitably, you've just wasted
(10:27):
your time and energy andresources.
So we said, okay, how do wecreate a moat around this
business and protect itlong-term?
We know Amazon is hot.
We know people are buying stuffon the internet.
How do we craft a businessmodel that can be supportive
long-term?
So we said we're going topursue private label again,
(10:48):
right?
So we own the brand, we own thetrademark, we control the
distribution of the product, wecontrol the pricing.
We get better costing becausewe're getting it directly from
the manufacturer.
And then any brands that we workwith, we want to enter into an
exclusive distributionarrangement with them where we
become the exclusive seller oftheir products on Amazon.
And these are big brands TommyHilfiger, kenneth Cole, like
(11:11):
brands that are well-distributed.
Let us be your exclusive and inexchange for that exclusivity,
we're going to manage yourcatalog on Amazon.
We're going to manage youradvertising on Amazon.
We're going to do yourstorefront on Amazon, right,
we're going to do all thesevalue add services or functions
that are useful for you as abrand and useful for us because
(11:34):
we want to sell more product,right?
And so everybody went to theequation and ultimately, what we
found was, in concept, thatmade sense, but it was really
hard for these brands tomaintain exclusivity and or
clean distribution.
So what?
What ended up happening in alot of cases is we do this deal,
we would buy the inventory,agree to hold price and all
(11:59):
these, and then we have we'd bestill competing against a bunch
of resellers because the brandshad leaks in their distribution
and they couldn't control it.
So and this is a verylong-winded story, adam and I'm
promising you, no, no, this isinteresting, I'm following along
here.
Yeah, so ultimately, you saidyou know what there's value in
providing services to brands,but we don't necessarily want to
(12:20):
have to buy their inventory.
Okay, that model isn't working.
Um, and what?
What?
Most what really works is forthe brand to own their, their
storefront and we become theadministrator to operate their
business and develop theirstrategy and provide all these
cool services and tactics.
Um, but do so in aservice-based model.
(12:42):
Okay, so the product businesswhere we bought inventory
pivoted all the way back toprivate label, right, and then
we said we're gonna create anagency to help other brands
create best-in-class Amazonbusinesses.
And we did that under beta fora year, year and a half.
Beta was successful, and thenwe spun ChannelKey out as a
(13:05):
completely separate company inJanuary of 2017.
So, um, so I ran.
I've been running channel keysince day one, and my two other
partners are running the othercompany.
Um, we ended up selling thatcompany in the summer of 2021.
Um, and so I've been withChannel Key since day one, first
employee since January of 2017,officially.
(13:28):
And today we're a full servicechannel management agency, a
fully remote shop.
I've got about 85 people onstaff all over the world and
we'll power, I don't know.
500 million in GMV throughAmazon this year, 40 to 50
million in media retail mediaspend, and we're some, really,
(13:49):
you know, large companies andbrands and really nice
businesses and we've got just anamazing team of smart
individuals that are all workingtogether to drive businesses on
Amazon.
So that's my, that's my journey.
Speaker 1 (14:04):
Amazon.
So that's my, that's my journey.
So yeah, you've I mean,essentially created like an
Amazon.
An expert Amazon marketingagency is what this has kind of
become, where any company cancome to you say, hey look, I
know I need to be on Amazon.
I have no idea what I'm doing,dan, dan, help me.
Speaker 3 (14:21):
Yeah, that's kind of how it works now, typically so
we've we've evolved over theyears, right.
So in the early days, we wouldwork with smaller sellers that
were launching right, but ofAmazon in most cases, right.
So these are typically brandsdoing anywhere from two to a
(14:48):
hundred million a year on Amazon.
Like that's our sweet spotright now.
Speaker 1 (14:52):
Yeah, yeah, and you're managing all their
advertising and everything else.
I just had a.
I just had a credit card, apoints guy, credit card guy on
my uh, on my show.
Are you, uh, are you using acard?
It's getting you some points,travel points or anything with
that uh ad spend Uh no, we'renot.
Speaker 3 (15:07):
Uh, that's all handled by our clients and run
through Amazon.
So we don't, fortunately, getto manage or run 50 million in
media through our company creditcard.
Speaker 1 (15:20):
You'd have all the points.
You would have all the pointsall the lounge accesses.
Oh man, you'd be living thedream we would own the plane.
Speaker 3 (15:27):
We'd just buy the plane on points, you know.
Speaker 1 (15:31):
You might be better off.
You just go wherever you want,whenever you want.
So, dan, somebody's starting onAmazon now.
I watch all these YouTubevideos, people, and they're
always chasing trends.
They're chasing trends, right.
It's like, oh, what's the nexttrend, what's the next thing,
right?
Uh, you know, now they claimall Amazon's not the thing right
now.
It's this other thing that'sgoing on, it's Tik TOK shops or
(15:53):
whatever, yeah, whateverwhatever it may be, right, uh,
but you could still do a Tik TOKshop and then have stuff link
over to your Amazon store or doAmazon or do TikTok advertising
or whatever and have that linkover to your Amazon store,
whatever the case may be.
But I mean, is it still aviable place to start a business
(16:13):
or is it just so saturated nowthat a small brand, somebody
doing a white label thing I gota, I got a personal trainer,
right, he's we.
I just connected him with acompany that does supplements
Okay, white label supplements.
I busted out some labels forhim for some pre and post
workout, you know, sent it overto my guys who do label printing
(16:33):
and, uh, he should be gettinghis, his supplements, his whole
supply of supplements hereshortly.
Right now, do you recommendsomebody like that?
Get on an Amazon Small brand?
I mean, I know they're out, youknow super small compared to
what you guys are dealing with.
Speaker 3 (16:53):
But what would you recommend they do?
It's a really good question andit's evolved over the years,
right, and I think one of thethings I said earlier is totally
true.
So what's one of the mostamazing things about Amazon, in
my opinion, is they've likedemocratized the ability for
entrepreneurs to set upbusinesses of varying types.
(17:14):
Right, it could be a productbusiness, like you're referring
to.
It could be an agency, likemine, could be a software
company, like there's a lot ofthese, like adjacent businesses
and in categories and verticalsthat have been created because
of Amazon.
Right, super cool.
And they've removed bearishentry, which also means that
it's cool and it's productive,and there's a ton of traffic and
(17:37):
a ton of volume going throughAmazon.
Like 60, 65 percent of allproduct searches on the internet
are starting on Amazon at thispoint.
So it's very much a productdiscovery platform, and I think
they own like 40% of alle-commerce right now in the US
goes through Amazon and 90% ofmarketplace business goes
through Amazon.
It's insane, right, but withall that volume and the lack of
(18:01):
barriers, there's a ton ofcompetition.
There's a ton of competition.
There's a ton of competition.
There's a ton of tools.
There's a ton of data out therethat exists for everybody to be
successful.
Okay, so that's a long-windedanswer of saying that you can.
You can absolutely start anAmazon product business, but in
(18:25):
my opinion, it's harder now thanit's ever been, for a multitude
of reasons.
One is the competition.
Two is, excuse me, it'sexpensive.
Right, amazon's fees go upevery year.
They've created this flywheelwhere it's super easy to do
business, but guess what?
It's a pay to play marketplace.
(18:46):
You got to advertise.
You got to pay Amazonadvertising dollars to
participate.
You've got to use.
Sorry, oh no, did I lose video?
Speaker 1 (18:59):
Yeah, I don't see anymore.
Speaker 3 (19:02):
What happened with me ?
Hold on, oh on oh, you're good,we edited everything anyway I
have this weird ai thing likethat whenever I like do certain
gestures, it creates this likeoh, I see that on on.
Speaker 1 (19:17):
Yeah, it does that on um zoom every once in a while,
my camera will do that.
It'll do some weird shitbecause I got gestures and stuff
that I can do and, um, wheneverI do a certain gesture, it'll
just like shut stuff down forsome reason yeah, but now.
Speaker 3 (19:32):
So for me when I do that, it like freezes for
whatever reason.
So hold on, give me a second.
I'm sorry, guys, are you goodyou?
Speaker 1 (19:47):
Kyle, where are you at right now?
What are you doing?
You had a kids thing, or whatare you up to?
He's in a dead zone yeah, hemust be in a dead zone.
He's driving.
Speaker 2 (20:05):
He must be traveling can you hear me now?
Yeah, I gotcha, I'm going to gojump on my computer while he's
fixing his camera.
He's driving, he must betraveling.
Can you hear me now?
Yeah, I got you All right.
I'm going to jump on mycomputer while he's fixing his
camera.
Okay, go ahead.
That way I can actuallyparticipate a little bit more
then too.
But I mean, so far it's beenpretty awesome.
That was a cool story aboutbasically like the pioneer of
(20:27):
e-commerce.
That was nice.
Speaker 3 (20:29):
Yeah, um well, yeah, it's the truth, so hopefully
that resonates.
Um, I should be back, am I good?
Speaker 2 (20:36):
Yep, you're back, you're back, I'm going to be.
I'm going to be back in likefive seconds.
Speaker 1 (20:40):
Okay, where do you want me to kick back off?
Uh, I can start with thequestion again, and then we'll
just start where I was or yeah,yeah, yeah, you can start over.
Yeah, I'll ask the questionagain and then we can just kind
of I'll cut out the whole otherone.
So so, dan, how do you, howwould you recommend somebody
start today?
You know I watch these.
(21:00):
You know shows on trend chasing.
You know whatever's hot.
And you know, oh, you know,amazon, fba was hot in 2021.
And, uh, you know, tiktok shopsare hot now.
You know how do people start inAmazon.
What do you?
You know small brands.
You know my buddy's personaltrainer he's got his own brand.
(21:21):
You know white labeled.
You know should he sell onAmazon?
Speaker 3 (21:32):
Um, so the?
I think the short answer is yes,okay, but it's, it's.
It's.
It's got to be said and knownthat Amazon is hyper competitive
right now.
They've they've created thisecosystem where entrepreneurs
can spin up these businessesreally quickly and you can have
a product company set up reallyquickly and you have access to
traffic really quickly.
You've got access tofulfillment.
You can do all these things,but it's very competitive and it
(21:55):
can be very expensive, okay.
So you have to.
Amazon's a pay-to-playenvironment.
At this point, you have to usetheir advertising, you have to
use their fulfillment, and thecost to do all those things can
be really high and thepercentage of revenue or sales
to do those things goes up everysingle year, literally every
(22:17):
single year.
It goes up because morecompetition, because you have to
use their fulfillment, and theywant to make more margin
dollars to appease theirshareholders or whatever.
So I think the answer is yes.
There's 60 plus percent ofproduct searches on the internet
start on Amazon and it's a verymuch a brand discovery platform
(22:39):
.
Amazon as a brand name isextremely trustworthy to the
consumer.
There's a hundred plus Primemembers that pay their annual
subscription and your buddy'ssupplement brand.
Well, guess what?
I've got to trust that thisbrand that I've never heard of
before is safe, and I'd bewilling to put this product in
(23:01):
my body, and I've never heard ofthis trainer and I've never
heard of this brand before.
But guess what?
I trust Amazon, right, and Itrust the reviews on Amazon and
I trust that if I don't likethis product, I can return it
with no problem and I trust thatI'm going to get it in one to
two business days, right.
So that ecosystem is hard toreplicate.
(23:23):
If your buddy was trying tobuild his own Shopify website
and create his own brand, that'shard.
It's really expensive, okay.
So the cool thing about Amazonis the traffic is already there,
but it's hard and it'scompetitive.
So my opinion, you canabsolutely do that.
But today, to launch a brand,if I were to do it from scratch,
(23:43):
I would very much have toincorporate social media into
the environment, and whetherthat's through TikTok and TikTok
shop is actually good forsupplements, right?
There's a few good categorieson TikTok beauty, health, right,
Wellness and fashion so thatmight be a good place.
I would always supplementAmazon with social media and or
(24:09):
TikTok shop.
At this point to leverage,don't put your eggs and all your
eggs in one basket on Amazon?
You can't, and you got to beable to drive traffic in various
ways and it cannot just lean onAmazon to find all your
customers for you.
Speaker 1 (24:28):
When this is one of the things you do, I mean with
your businesses.
You help with SEO.
You help you know, say, saysomebody's got a Shopify site
and I we do websites for youknow a living here, right?
We have an agency for 13 yearsand most people are going to go
on Shopify and they're going tocreate a crap website.
They're going to build it.
It's going to be ugly as sin.
(24:54):
Their photography is going tobe absolute garbage and they
don't know what they're doing.
And you know their SEO is goingto be nasty too, because none of
their images are going to beoptimized.
Obviously, they're all going tobe named image zero, two, three
, four, five dot JPEG andthey're not going to have any
metadata on them.
So they're not going to havetitles, descriptions, nothing,
because nobody knows how to dothat.
Right, they?
Unless you build websites andyou understand how this stuff
works, you really don't know howto optimize your own website,
(25:17):
let alone get paid advertisingand manage that paid advertising
.
So explain a little bit abouthow you guys help people like my
buddy who's a trainer, and Iknow you work with much bigger
brands, but is there, is therean opportunity to work with some
of these smaller brands withyour agency and how would you
help them?
Speaker 3 (25:35):
Yeah, so what we do, um, based upon what I heard that
you guys do, I think it's verysimilar, right, but the
difference is is we just do itwithin the Amazon environment,
right?
So if you think about a brandthat sells on Amazon and you can
pick any brand, I don't knowNike.
Nike has an Amazon storefront.
(25:59):
Nike has a bunch of productlisting pages or product detail
pages on Amazon that have photos, that have a title, that have
bullet points, that havedescriptions, that have A plus
or HTML content, right?
Furthermore, you have toadvertise, right, and the
(26:22):
options and choices foradvertising and leveraging of
retail media on Amazon arereally they're endless.
There's so many options at thispoint.
Okay, so you've got the SEOelements right.
So A Amazon's a giant searchengine.
You want to make sure thatpeople can find your product,
okay, and you do that throughtraffic driving or indexing or
(26:47):
placement in their searchalgorithm, and then, once you
get them to your product detailpage, they have to convert,
right, and you do that with goodcontent and telling a good
story and having good reviewsand, you know, putting product
videos in there and the FAQ andall these, all these things,
right.
So we do all that work andthere's a lot of strategy around
(27:09):
that and every category isdifferent and the life cycle of
the product is important, andthe budget is important, and the
profitability of the categoryis important.
And then, guess what?
There's all these other thingsthat have to be done, also on
Amazon.
There's a whole back end, right.
There's a lot of accountmanagement.
There's a lot of technicalthings that have to happen.
If your buddy wants to sell onAmazon, guess what?
(27:30):
He's not going to be allowed tosell supplements right away on
Amazon.
He's going to have to gothrough a process to get ungated
or to get approval to sell thatproduct type.
Not easy, right?
Exactly Setting up fulfillmentyour ops there's a process to
that.
Setting up fulfillment your opsthere's a process to that.
So there's a lot of behind thescenes work that gets done, and
Amazon is hard sometimes to workwith.
(27:55):
You can't just pick up thephone, call somebody and say hey
, Amazon.
I've got this issue.
Can you help me fix it?
They don't do that.
It's not how it works.
No, so you've got to know howto navigate and a lot of their
system is archaic and clunky andstill from the old days and
they're, you know, marrying itwith with some of the newer
streamlined tech and interface,and it's hard, right, it's
(28:15):
really hard.
So that's where we come in.
Right, we start in most caseswith strategy.
Right, let's build you abusiness plan that helps you get
from A to B.
And what does that mean?
At the product level, it couldbe different for all the
products, right.
And how many SKUs do you have?
Do you have one ASIN, one SKU,or do you have 10,000 SKUs?
(28:36):
Strategy's different, right.
So that's what we do.
Right, full service channelmanagement agency and like eight
or nine different people touchour client accounts in a given
month.
They can be doing graphicdesign, they can be writing copy
, they can be doing ads, theycan be doing DSP We've got our
own DSP seat with Amazon.
They can be doing forecasting,analytics, account management.
(28:59):
So that's where we come in.
So, typically, what we've seenis entrepreneurs that are able
to create these Amazon brandsright, where their primary
distribution is through Amazoncan do really well, okay, and
they can grow and they candevelop and at some point they
they tap out right and if theyhave the chops to actually run a
(29:20):
product company and maintainpositive cashflow which is
really hard and a hard lesson tolearn for a lot of people At
some point they need moresophistication, and that's where
we come in.
Speaker 1 (29:34):
So and now, who are you looking to work with?
Like what, what?
When do people come to you?
Where are they at with theirannual revenue?
Is that what you're looking at,or are you looking at some
different figures?
Are you just looking at atannual revenue?
Are you looking at net?
Are you looking at like what,EBITDA?
Like what are you guys lookingat?
Speaker 3 (29:51):
Yeah, good question.
So we typically work with SMBsand enterprise level brands that
have distribution outside ofAmazon.
Right, they could be sold inNordstrom's or Dick's sporting
goods or in Whole Foods orwhatever.
We're generally categoryagnostic.
Okay, we like all categories.
We love consumables as acategory and they are typically
(30:14):
doing already anywhere from twoto a hundred million dollars a
year and sales through Amazon.
That's kind of our, that's kindof our sweet spot.
So that's where we target,that's who we go after.
That's you know the content weput out and my sales team and
biz dev team that's.
Those are the folks that wetalk to.
Speaker 1 (30:35):
Yeah, and I you know what I like your web.
I like your website and I'lltell you why.
And I think other people ifthey go to your website,
channelkeycom and you know we'rein a consumer products capital
of America, probably you are.
Yeah yeah, procter Gamble here,you got Kroger here, you got the
largest consumer packaged goodscompany and the largest grocery
chain in the same city together, and then you have the largest
(30:58):
Amazon hub in the world innorthern Kentucky's airport,
right down the street.
So yeah, and a large DHL huband a large Wayfair hub and a
lot.
I mean we've got.
We've become this like consumerpackaged goods logistics city,
what I like.
Uh, I mean so it's great.
I mean we get discounted crapall the time, like there's
websites bid FTA and all thatstuff and I mean you could drive
right down here to a warehouseand pick up a dryer and still
(31:21):
wrapped up in plastic for 200bucks.
You know, I mean it's prettyamazing and there are a ton of
things like if you're in thatworld and Kyle here on the call
with this is a freight brokerand you realize how much stuff
just gets, it's cheaper for themjust to sell it on one of these
sites and it is.
You know, you got returns andall that other crazy stuff going
(31:42):
on and I mean you've got somuch waste in this world and
people return and stuff and it'sjust it's tough, but what I
like I was going to say, what Ilike about your website is if
somebody is building a site,you've got you're building a
Shopify site or you're buildinga site for any, any product.
You've got a great top offunnel strategy here where
(32:03):
you've got this schedule, yourfree report.
Now your brand audit.
Which people look at this?
Any of these brands?
Procter, gamble if you'relistening to this right now,
this is really interesting.
So find new Amazon customersfor free.
You get Amazon share, voice,category, market share, growth
opportunities.
I mean, this sounds like acrazy comprehensive report for
(32:26):
somebody and you're getting thisfor free, which then leads them
into that next step with youguys.
Speaker 3 (32:34):
Adam, can I hire you?
That's great.
Yeah, we just did our.
We redid our website last yearand Kristen on my team will be
thrilled to hear your positivefeedback on it.
We spent a lot of time andenergy and effort on it and,
yeah, I think what we like to dois educate, if we can.
(32:56):
It can be really challenging anddaunting to operate on the
platform for reallywell-established larger
companies and smaller sellers,and so, for us, the way we can
educate is through data andconsuming data and and,
ultimately, communicating whatthe data means to, uh, to
different companies and brands.
So we love to do it.
(33:17):
It helps us understand, um,where the pain points are and
where the opportunities are.
It's really a gap analysis,right?
Yes, uh say, hey, you know, andsometimes folks we talk to are
doing an amazing job and theyfrankly, don't need our help.
And other times we see it andwe're like, hey, there's like 12
things you need to do right nowto fix what's happening and to
(33:37):
and to make this business better.
So that's what it's meant to dois we want to talk to people
and be helpful and, obviously,find new clients and customers
and, uh, one of the ways we dothat is through auditing
businesses and providingcompelling data and information
to folks.
Speaker 1 (33:54):
Yeah, I mean, if I'm an assistant brand manager on
Tide or Gillette or you know,dreft, I look at this and I say,
oh wow, look at this, they'redoing my work for me.
I can get this report and thenI could take this up the ladder
and show them how smart I am.
And oh, by the way, uh, I'mworking with this company
channel key that put thistogether for me.
(34:14):
Oh, how much did you pay for it?
Nothing, oh, wow, let's, let'sget started, let's figure this
out, like they can see.
I mean there was a lot of workthat goes in.
I'm reading this list here.
I mean this is a tremendousamount of work you're giving
away just for the opportunity towork with some of these guys.
Speaker 3 (34:31):
Yeah, that's a good point, yes, and we're happy to
do it, and we've got some of thebest technology partners out
there that work in our ecosystem, right, and so part of this is
we know what the data, we knowthe data, we know what to look
for.
We know not what not to lookfor, but we also have access to
(34:51):
the information, and we do thatthrough a lot of our technology
partners and our ability to kindof aggregate, and so we can do
it at scale, right, and ingeneral, that's a reason why
somebody would hire an agencylike us or like you is because
we can theoretically do itbetter, faster and for cheaper,
(35:11):
right, and we've got the techstack already in place, oh yeah.
So, yeah, that's our business,we're happy to do it.
Speaker 1 (35:18):
Well, and I used to do graphics at an agency I used
to work for back before Istarted my own thing, and we
used to build Amazon stores forpeople.
But I would, I would be the onethey you know, you'd have your
copywriter and they would bewriting all the content and then
they check with the SEO guy andmake sure everything was good.
Did I get all the keywords inthere?
And then they hit me up and say, hey, Adam, we need a graphic
(35:40):
this big for this.
Here are all the sizes.
And I'd get a list, an email,of like 50 different graphics I
needed for all these differentthings and for all the products.
And there's different sizes foreach product depending on what
screen they're looking at.
And it gets kind of wild.
And if you own an Amazon storeand if you're a a brand, most of
the time they're going to hirean agency like the agency I used
(36:01):
to work with, or they're goingto hire somebody like you who I
feel like can do a lot more.
There we were just doinggraphics and write copy, but
who's who's managing everything,who's making and who knows what
they're doing out here?
I mean, it sounds like you guysare the the.
Speaker 3 (36:18):
You guys are the the one we've been doing it for a
long time, right, and you know,I think one of the things that
that's unique about us is webuilt our own business, like we
built our own product businesson Amazon ourselves, right, we
sourced all the inventory, wewarehouse the inventory, we
packaged it, we labeled it forAmazon, and we made a ton of
(36:38):
mistakes over the years and wedid that.
As for our clients today don'thave to, right?
So we didn't just learn it onYouTube, we didn't take a course
and we actually did it, yeah,and so, uh, we know how to do it
and we get into the weeds andwe do things that most people
don't do or don't want to do,because it's sometimes it's
(36:58):
unsexy, um, or they just, orit's hard, right, but in our
view of the world, like youcould have the most amazing ads
strategy in the world on Amazon,right, but if you can't keep
your products in stock, if youcan't do the basics and the
fundamentals and operate acompany in that ecosystem, it
(37:18):
doesn't matter, right?
So we, that's why we take thatholistic approach to full
service approach, because wewant to control really all the
key elements that are requiredto to run a store like that, um,
and the reason we know how todo it is because we've done it
ourselves.
Speaker 1 (37:34):
Well, and I mean you, you know not everybody's going
to have side hustlers out herearen't going to have, you know,
the Fisher MBA you know they'renot going to have done.
You know, grown up in Amazon,essentially Like I mean this is
what I mean, you've been doingit long enough.
I mean you've essentially grownwith Amazon and you know you
were early, you were able topivot with Amazon, pivoting and
(37:56):
understand what's going on forfor the new side hustler out
there.
What are some of the mistakesthat you see people making today
?
Uh, what are some of the placesyou would recommend them?
Should they do FBA?
Should they be doing dropshipping type stuff and explain
even what that is?
People don't even know whatthat is on this podcast.
Where are the opportunities atright now?
(38:16):
You think?
Speaker 3 (38:23):
Yeah.
So my mindset always goestowards how do I build a
sustainable business right thatcan function well over time,
versus trying to make a quickbuck right, and how do I create
leverage for myself?
One of the easiest thingspeople can do is create a
(38:44):
dropship business right, andbasically what that means is you
can create a relationship withsome sort of supplier of a
product right or productssupplier of a product right or
products and you can list thoseproducts for sale on Amazon and
have uh, whereas you are theseller right.
So if Adam wanted to create hisown Amazon business, you could
(39:06):
call it Amazon's or Adam's.
You know Adam's stuff and he'sthe seller of record on Amazon
and what he's selling isactually through a catalog of
products that he doesn'tactually own.
He's never bought it, okay.
So if somebody comes throughand buys that particular item,
what Adam would do is he wouldsend the order to his supplier
and the supplier would ship theitem directly to the customer.
(39:30):
Right, and that's a drop shiporder.
So Adam didn't have to buy theinventory.
He didn't have to store theinventory.
You have to do anything.
All he did was broker the dealand he gets a commission paid to
him by the supplier and he paysAmazon a commission right.
So you don't need a lot ofcapital for that, you don't need
a lot of resources andinfrastructure.
(39:51):
But that's a really hard model,right and in essence, sounds
easy, right, sounds all fly.
Speaker 1 (39:59):
All I got to do is make a sale.
Speaker 3 (40:00):
Oh yeah, yeah, easy peasy, right, but the problem is
is that a lot of people aretrying to do that and you're not
actually adding value toanybody in the value chain.
In my opinion, right, what wetell our brands is you should be
selling direct to consumer.
There's no need to distributeto anybody else or to have your
products be sold by anybody elseon Amazon except for you, okay.
(40:23):
So what value is the brokerproviding in that scenario?
Right, in my opinion, it's veryminimal.
You're just brokering thetransaction, right, people are
creating the value, are thesupplier, the brand and Amazon.
So and I don't believe that'ssustainable long-term business
(40:44):
model and it's not thatprofitable, okay, so the other
option is you can become areseller, so actually buying
other people's products, storingthem, stocking them, putting
them in FBA and shit and sellingthem.
That way, viable businessrequires capital, right, you
have to buy the inventory, okay,and you have to store it, and
you might get stuck with it.
And if you are, I don't know,the third or fourth person
(41:07):
that's actually buying thatinventory from the manufacturer,
right?
If you're like the fourthremoved person from the
manufacturer, guess what?
Everybody along the way isdoubling their money, right?
So you're paying a very highprice for that item to be a
reseller.
Amazon's costing model isreally high.
You're not going to make anymoney.
(41:27):
Like there is very there's avery high likelihood that after
all is said and done, after youpay for the ads or pay for the
fulfillment, you're not going tomake any money.
Speaker 1 (41:37):
And these are brands that are already popular, you
know, like the tides of theworld or whatever, and it's.
I know that to sell a productlike that, with a strong brand,
unless you know what you'redoing on Amazon, you're not even
going to be able to sell that.
Speaker 3 (41:49):
They might not let you sell it.
A and B.
Even if you are able to sell it, you're going to pay too much
for it, to where you're notgoing to be able to make any
money on the back end.
Now some people do thatbusiness and it's viable and
they're really smart and theysqueak out thin margins.
But they know how to do it andthey've got these amazing
relationships built withsuppliers.
(42:09):
They've got buying power, theyhave scale where they can buy in
bulk and maybe get betterpricing, better payment terms,
et cetera.
But you've got to build to that, and so there's that model.
The other model is you can buildyour own brand, right, private
label.
Right, that's where you'regoing to get the best costing.
Right, you're going to controlthe distribution.
You don't have to deal with themiddleman.
Theoretically, you're dealingdirectly with the manufacturer,
(42:32):
maybe a contract manufacturer.
But guess what?
Nobody knows who you are.
Right?
They've never heard of yourbrand, they've never heard of
what you sell.
Why would they trust it?
Right?
So the model to build abusiness like that is completely
different.
Right?
You then have to tap in to thetraffic on Amazon and, opposed
(42:54):
to having people directly searchfor your brand on Amazon, they
have to search for some genericsearch term.
Okay, you brought up apre-workout.
Cool, I'm going to searchpre-workout.
Well, how do you get your buddysupplement that nobody's ever
heard of before, that has notraction, no reviews, no
conversions, to index an Amazonsearch algorithm for pre-workout
(43:16):
?
Really hard.
Speaker 2 (43:17):
Real hard and really expensive.
Speaker 3 (43:19):
And you're probably going to end up on page 12 of
search results, right, and inreality, you need to be on the
top half of page one.
That's where all the action'shappening.
So there's a different strategy.
Right, you got to pay for thebusiness.
You got to be willing to losemoney.
You're going to have to drivefor the business.
(43:39):
You got to be willing to losemoney.
You're gonna have to drivesocial traffic and you're going
to have to get on TikTok shopand hopefully create some good
videos.
You get some traffic going inand or be able to absorb just
the amount of money it's goingto take to launch a new brand,
right, but it's totally viable,it's doable and people do it,
and so the thing I'd have to beI would caution people around
being careful of isunderstanding your cashflow
model.
(44:01):
Okay, just because you sell$100,000 worth of product on
Amazon doesn't mean you get$100,000.
At all, and it doesn't meanyou're ever going to get it, and
if you get it, it's not goingto happen right away.
So, to continue on with abusiness like that, you've got
to continually leverage yourcashflow to buy more inventory,
(44:21):
and some people don't know that,especially young entrepreneurs,
right, they're like man, I justsold $100,000 worth of stuff.
Why is my bank account in thenegative Right?
And that's the reality is youneed to understand your
operational and cashflow modelto be able to continually
sustain a business like that.
And that's the reality is youneed to understand your
operational and cash flow modelto be able to continually
sustain a business like that.
And it's hard and it's risky.
Speaker 2 (44:40):
Yeah.
Speaker 3 (44:40):
So, but it's doable and there's a ton of data out
there and you can do productresearch and you can find all
these really cool opportunities.
And if you're one of the luckyones that finds that white space
, you have to pounce on it fastand build the momentum fast,
build the reviews fast, get thetraffic going fast, because
chances are, if you found anarea of white space that it uh,
(45:03):
it will be um, you will bebombarded with competition very
quickly.
Speaker 1 (45:08):
Oh yeah, yeah.
I mean there's millions andmillions of people selling on
Amazon, so and and a lot ofthose people in other countries
and they have all kinds of timeto do it and they have cheap
labor that's doing it for themand all kinds of stuff like that
.
So I mean, what do you thinkabout affiliates?
I mean, do you guys use anaffiliate strategy for some of
your stuff?
Do you have a list ofinfluencers that you reach out
(45:28):
to when you're trying to pushsomething like that?
Speaker 3 (45:31):
Yeah yeah.
Affiliates are good,influencers are good.
No-transcript, the rightaffiliate, and you've got to
(46:07):
make sure that your product typelines up with their audience
and that you can strike a gooddeal.
That makes sense.
It's absolutely one of the manytraffic driving options that
brands can consider.
Speaker 1 (46:21):
So you just mentioned a lot of different strategies
advertising strategies, right,yeah, yeah.
But you also have to understandand this is one of the values
of going with someone like youversus trying to figure this
stuff out on your own thingsthat you've learned how to do
over the years, right, andyou've again, you've matured, as
amazon has matured.
But also, you said somethingearlier about categories being
(46:45):
popular on certain platforms.
Now we all know at least weshould that there are a handful
of categories in general thatsell well on social media, right
, right, health and wellness isprobably the most popular
supplements, things like thatPeople love that.
Beauty, weight loss, you knowall that kind of stuff.
Another thing you have toconsider is not only these
(47:10):
advertising channels, but whatworks on those advertisers.
So what are you selling?
Where can I put my dollars?
That they're most effective,right.
And what's the old saying?
50% of my advertising is wasted.
Advertising dollars are wasted.
I just don't know which 50%.
Speaker 3 (47:25):
Yeah, yeah, you can exactly.
So, um, it's hard, right, andyou've got to piece together
that strategy, um and um, and itchanges quickly.
Yeah Right, the dynamic canchange quickly and it's
different for every category,product type and, uh, and life
cycle of a brand and or aproduct.
Speaker 1 (47:46):
Yeah, can you, dan, can you just have like a YouTube
channel or something where youyou teach young, uh, aspiring
e-commerce sellers to, to, tothe tricks of the trade early on
?
I mean, you guys are doinggreat Cause.
You know you're, you've gotthese like larger companies that
you're working with and you'rekind of you know you could coast
now.
I mean, obviously everybody'salways looking for more business
(48:08):
, but you know, the smaller guys, the people that, uh, that
don't know what's going on, someof the tips you've shared here,
some of the stuff you've putout here that they may not be
familiar with.
You know, I'm in a brand cityso I obviously I get everything
you're saying, but most peoplearen't right.
Most people are just like JoeSchmo that lives out and you
know wherever in the middle ofnowhere and hasn't ever worked
(48:28):
in advertising in their entirelife.
Where do they go for tips?
Where do they go?
Is there a company or somethingthat you guys work with for the
lower level guys until they canbuild up to where you're at?
Speaker 3 (48:38):
So it turns out, we do have a YouTube channel and
you'll find us on YouTube, andalso we're super active on
LinkedIn.
Whether that's me or thecompany, you can find me on
LinkedIn.
And yeah, we, we've got a bunchof partners that we work with
that if, if, if, we're not theright fit for a business, for
whatever reason, we always liketo refer people out to trusted
(49:01):
partners.
So, yeah, we'll evaluate andhelp anybody we can, but if it
doesn't make sense, we've got alist of folks that we can refer
out to.
It just depends on thesituation.
So we're happy to chat withanybody.
Look at anything, and if itrequires us to push it out
elsewhere, we'd happy to chatwith anybody.
Look at anything, and if it, uh, requires us to, you know, push
it out elsewhere, we'd love todo that I love it.
Speaker 1 (49:21):
Man, dan, tell, tell people how they find all this
stuff and I will put some linksin the, in the, in the
description at the end of here.
But uh, you know, for thepeople listening, uh, tell them
how they can find you.
Speaker 3 (49:32):
Yeah, so you can go to our website, uh,
wwwchannelkeycom.
Check out our cool website, asAdam mentioned.
Uh, you can find me on LinkedInto search my name, dan, on
LinkedIn, or search channel keyon LinkedIn.
Uh, or you can find us onYouTube also by searching
channel key.
So we're everywhere.
I love it man.
Speaker 1 (49:52):
Well, I appreciate you spending the time here.
I know you're a busy guy.
You've got, you know, these bigbrands you guys got to manage
and that takes up a lot of time.
And enjoy Vegas, man, I'm gladyou're there.
You're in the warm air.
You don't have to deal withthis misty rain all the time and
you never know if it's going tobe 90 degrees outside or 45
degrees outside here.
(50:13):
It's uh, I don't know what it'sgoing to be when I walk outside
right now.
Speaker 3 (50:16):
So we'll see Good Godspeed, Adam, Good luck to you
.
I love, I love Ohio, Goodpeople, Um, but you're right, I
think the vague, I choose theVegas weather.
So uh, appreciate you having meon.
It's great to great to meet youand uh, uh love spending the
time together.
Speaker 1 (50:35):
Awesome man.
I appreciate it.
Thank you, Thanks, Thanks forjoining us on this week's
episode of Side Hustle City.
Well, you've heard from ourguests.
Now let's hear from you.
Join our community on Facebook,Side Hustle City.
It's a group where people shareideas, share their
inspirational stories andmotivate each other to be
successful and turn their sidehustle into their main hustle.
(50:57):
We'll see you there and we'llsee you next week on the show.
Thank you.
Speaker 2 (51:21):
Bye.
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