In 1988, the Detroit Pistons, also known as The Bad Boys, created the “Jordan Rules”. It was a strategy developed specifically to stop the dominance of Michael Jordan, who was obviously a lethal player and the catalyst to the Chicago Bulls. The point of the Jordan Rules was to ultimately offset a huge advantage that the Bulls had developed with Jordan’s unmatched skill.
What does this have to do with Amazon and the recent Terms of Service change? In some respects, it seems that Bezos and Amazon have made a sudden and drastic change in the rules, so that an important strategy that sellers rely on is essentially nullified. So yes, we are all Michael Jordans! And we need to find a way to strategically work around this new world.
Let me back up for a brief second. I am referring to the change in Terms of Service issued on October 3rd that reads: …
This means that services that are marketplaces for discounted products in exchange for honest reviews are no longer within the terms of service. Review Kick (now relaunched as Jump Send), which I launched earlier this year, had a component of coupons in exchange for honest product reviews.
In this blog post, I want to explore what this change of Amazon’s Terms of Service means for sellers going forward, and how it will change the existing landscape.
CAVEAT: First, I would like to state one important assumption: it is always best to play by the rules. Don’t worry, my spectacles aren’t at the tip of my nose as I wag a finger at you. I say this because I truly believe that black hat tactics, in regards to anything, have a very short shelf life and ultimately leave you in a worse position than where you started.
With regards to Amazon sales and digital marketing, there are often detours that you can take to shortcut a process and get ‘big” results fast. With Jump Send (previously Review Kick) for example, it was always a top priority to stay clearly within the Terms of Service. Now that the policies prohibit incentivized reviews, we respect that and ask our users to as well.
Here are some of the changes that I foresee in this new Amazon seller world:
The world moves very fast when you are an Amazon seller. I would see relatively new and untapped niches get “saturated” and competitive very quickly. One thing that made it very tough for new entrants was the social proof of products that had generated a surge of reviews.
These sellers made the calculated decision to invest in promotional giveaways, with the understanding that they would get product reviews (and presumably the increase in conversion rate that came with the social proof) and improved Best Seller Rank with the sales velocity.
In the new Amazon world, getting a bucketload of product reviews won’t be as readily doable.
The result is that there will be a more even playing field. Product reviews will be harder to come by. And reviews will be more of a meritocracy, meaning that it will not necessarily be as easy to get a great review.
I believe the confluence of these factors means more opportunity for new sellers to enter the marketplace. It won’t be possible for bigger sellers (Amazon included) to barge into a new niche, flood the market with discounted products, and get a bunch of reviews and quickly be a top seller. All sellers will have to take the slog of going from a new product to eventually becoming a well-established product.
The asterisk to my statement above about Amazon becoming more of a meritocracy is that it will be harder to break into competitive and established niches.
Take Vitamins and Dietary Supplements for example, a notoriously competitive category. The top products have thousands of existing reviews, on average almost five stars. It would take a significant amount of time and investment to build up a listing that has thousands of organic reviews now. Until that point, the new product is likely languishing on the back pages with minimal impressions on any given day.
This is not a viable route for sellers anymore.
However, the flip side to this is that it is much more realistic to launch a new product in a less competitive niche and start competing there. No longer is it an arms race to stack up as many reviews as possible. If you spend the time to find a great product niche that does not have a lot of competition, you have a great opportunity before you.
I will be sharing my product research strategies, updated with these new changes in mind, on Wed 10/19. These techniques have helped me find Jungle Stix, which have sold more than $140k since launching 10 months ago. Register here:
CLAIM YOUR SPOT AT MY PRODUCT RESEARCH SEMINAR
Product Reviews acted like a performance booster for Amazon sellers. However, with such a boost no longer allowed, everyone is forced back to basics. And this is where you separate the wheat from the chaff. Or the cream will rise to the top. Basically, if you play by the rules and execute, you will succeed.
This relates especially to several steps along the way:
Going forward, I (along with many Amazon sellers) will have to tweak our launch strategy. I am in the middle of a new product launch right now and this appears to be working very well!
Step #1. Run 3-10 Promotional Giveaways per day for a week. Amazon has not changed its policies of giving away promotional items. All sellers who have professional sellers accounts can utilize promotions, and I still think that it is a viable strategy for initiating sales velocity and history. This results in an improved Best Seller Rank, so that you can have your product appear for your main keywords. These promotional giveaways will not translate directly into product reviews, however, that is where step 2 comes in…..
Step #2. Focus on optimizing Email Campaigns. Each email followup campaign that I run is tailored to the specific product, niche, and customer profile. Going forward, these emails will be even more important in converting customers into brand advocates and product reviewers. I must be very clear here: you want to proceed with caution so that there is no confusion that you are giving away discounted products, with an expectation of receiving a product review in return. That would be considered an “incentivized” review, and that is against Amazon's terms. Instead, send thoughtful, relevant, and timely emails to your customers to enhance the buying experience, and showcase your product and its various use cases.
Step #3. Start Pay Per Click Advertising from the beginning. There is a prevailing theory that you want to start your PPC campaigns once you have 10-15 product reviews. The thought here is that you want to have social proof on your listing before you pay to drive traffic there. I think this is now old-hat. As I mentioned above, it is important to get traffic and sales early, and PPC campaigns are one channel to do so.
I believe that this will be an effective launch strategy and all early signs point to that. Of course, things may continue to change with how Amazon interprets and enforces its rules, but I will keep you updated on such changes.
Bringing it all back full circle, the Jordan Rules stymied Jordan for a few seasons, but only for so long. MJ and company played strategically and intelligently (obviously with a lot of talent and skill along the way) to win six championships. The moral of this story? With ingenuity and work, challenges like what these new Terms of Service present can be overcome. And I believe if you follow some of the points that I outlined above, it will allow you to separate yourself from the crowd, which will be to your great advantage.