FBA Case Study – How to Leverage External Traffic and Build Sales Funnel
Setbacks are a part of any business and mine is certainly no different. The best kind of setbacks I have found are ones where as a result of the setback we identify a new opportunity and the business/systems come out the other end stronger than before.
That was certainly the case when it comes to my Amazon FBA business that I sold and shortly after had my Amazon Associates account suspended (You can read all about that and what some of your options are here if your amazon associate account was closed).
My FBA business was launched off the back of an Affiliate site that was making about $1k/month and then grew both the affiliate and FBA business to $10k/month with the affiliate site adding $3k of that. Regardless of your product you will need to use some strategy to drive traffic and sales… whether it is as this post shows you with external traffic or with a service like ExtremeRebate, Samurai.Social or others.
With the loss of the affiliate income we had a BIG problem…how would it still make sense to drive traffic to Amazon if we were loosing out on the 8% affiliate commission?
In this post I am going to share some general business philosophies and how we responded to the problem including some of the very cool tools we used to build out a funnel to both generate sales, increase our conversions on Amazon and build a massive list.
If you run or are thinking of running an FBA business leveraging external traffic from your own website than this will be very helpful when you think about one strategy to build an external funnel!
3 General Business Philosophies
When it makes sense I like to share a few details on my thought process when I am looking at different business decisions.
3 business theories I have that are relevant to this post are…
- Always Have a Competitive Advantage – One of my rules I try and stick to is to not jump into a business until I have a clear competitive advantage. In the case of my FBA business that competitive advantage was having the off Amazon traffic driving to my listing.
- Build with Anti-Fragile in Mind – A great book that has influenced my thinking is Anti-Fragile and I have worked to put levers in place so that when my business hits a road bump I have levers to pull so that the business can take advantage of whatever the change was.
- Diversified “Income Stool” – Any black swan event can take out one-two sources of income for the business but the goal is there are multiple legs for the businesses income stool so any 1 leg getting chopped out has us still in the fight. This is both true for the business overall as well as the Amazon Associate + FBA business model.
So what happened… My Amazon Associate Account was Closed shortly after the site was moved into the new entity as part of the sale. This represented a $3k/month loss to the $9-10k/month business
In addition there was another problem with my previous strategy, the typical Amazon Affiliate site strategy, dumping as high a percentage of people from the website to Amazon as possible. This strategy of having no pre-qualification of people going to buy our physical products results in the conversion rate at Amazon being worse than it otherwise could be which is a ranking factor in Amazons search algorithm.
Instead of sending people directly to Amazon via an affiliate link and hurting our conversions on Amazon we decided to send the traffic through a squeeze page in exchange for a small discount they would enter their email.
Previous Flow of Traffic
Current Flow of Traffic
This plan was executed with the following steps…
The simple call to action is an offer to receive the product at an exclusive discount, then by entering their email on the squeeze page they get taken to a landing page with the coupon code.
Here are the tools and services we used to make this all happen…
Build The Pages
- AMZPromoter – Custom tool built specifically for this very purpose, makes building an off Amazon funnel for traffic to Amazon very easy!
- ThriveThemes Landing Page Builder – ThriveThemes is another great option to use their ThriveLeads plugin plus Thrive Page Builder to achieve a similar but a little less slick result as AMZPromoter.
Connect to Email Autoresponder
- ActiveCampaign – If you are using anything else I definitely suggest you giving it a look, beats all the older popular options (AWeber, MailChimp, ConstantContact etc) and is WAY cheaper than the premium InfusionSoft type of solutions. I hear good things about Drip as well.
Get Compelling Email Sequence Written:
- Hire an Expert Email Copywriter (Matt Lord is the expert I hired) – For our project we worked with an expert email copywriter since I am not a member of this market. He helped to define both the initial sequence as well as an email sequence that is taking advantage of the large email list to sell related information products. I highly recommend him and suggest checking out his free 5 part lesson on email copywriting that sells!
Benefits of This System:
- Improved Conversions on Amazon – If someone has taken the steps to enter their email and have received an exclusive discount code that it will be unlikely they will buy a competitors product if all else is equal.
- Use email list to launch new products from – This is one of the biggest benefits of this system. Having a list of people who have identified themselves as wanting to buy the products can be used to help launch additional similar products.
- Use email list for promoting similar or complimentary products such as a course or software if relevant.
Downside to This Method:
- Affiliate income will be less as more people will not eventually get to Amazon (if you have has your associate account suspended it is a no-brainer… however if you still have your associate account you will need to do a test and run the numbers).
So this is all good in theory but what were the actual results?
I can share a few numbers here now that I have done this for 2 FBA brands…
- Result = 72 Opt Ins Per Day
- Traffic to Site = 2,500 visitors per day
- Opt In Rate = 2.9%
In the course of only a few months we have built up a list to almost 10k people looking to buy our product and related products.
What this shows is that around 6.4% of traffic is filtered out due to them not wanting to enter their email to receive the discounted coupon. This 6.2% is essentially the downside to running the traffic through this funnel vs direct to Amazon.
Squeeze page converting at 33% is the largest opportunity where the majority of the traffic is not converting to a lead and potential sale, although 33% is pretty solid!
The two graphs below show the change that can result from implementing this system. The first few months of the graph show the conversion rate for a more typical offer and then at the start of September I made the change to send traffic through a squeeze page.
What About Earnings Impact?
This is definitely a little harder to track in Amazon because of the multiple variables that are in play however the graph below for Brand #2 clearly shows the jump that resulted both from the modified traffic flow and there were also some inventory issues resolved at this time…