Tag Archive for: Amazon & (FBA)

How eSellerPro’s Channel Profile Can Help Your Business

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One of eSellerPro’s core features is a function called a ‘Channel Profile’, in this article I’ll be covering the basics to what a ‘Channel Profile’ does and how it can help your business.

Multi-Channel selling is now an assumed practice for eCommerce businesses, unlocking the power to reach a much wider audience than you could ever have imagined, but sensibly. The Channel Profile feature in eSellerPro can enable you to achieve this.

I’ve put together a short video, where I describe the key benefits of using a channel profile and how it could help your business when dealing with multiple sales channels.

What is a Channel Profile?

The purpose of the channel profiler is to maximise the exposure of your inventory exposure across more than one channel, then once an update has happened to let the other channels know of that update to the stock level.

In eSellerPro you can create more than one channel profile (hence ‘profile’ in its name), which you can apply to more than one inventory record and each profile can have different attributes. I’ll cover these later on in this article, but for now the easiest way of explaining what a Channel Profile does is by using  an example.

Let’s say we have 10 of the same mugs in stock and we wish to sell them on:

  • One eBay account
  • Amazon
  • Our website.

For maximum market exposure, we’re going to use the channel profile to list ALL 10 of these mugs onto eBay, Amazon and also show them on our website too. A couple of hours later, a customer called Jane buys one from eBay.

We now only have 9 in stock and the channel profile will now update Amazon to 9 and the website also to 9. Then another customer, Jim buys from the website. Again the channel profile will update the other marketplaces, eBay & Amazon with the new stock level of 8.

The next morning a new delivery of these mugs arrive and we have 10 more, so we now have a stock level of 18 mugs. The Channel profile will now update each of the selling channels where the products are listed with the updated stock level.

In this basic example, we gain maximum market exposure for our products and keep each of the selling channels in-line with the latest stock levels. Neat eh?

The Negatives of Using A Channel Profile

I’m going to note here the negatives you might have already realised are minor in comparison to the positives of exposing your inventory across as many channels as possible. However you need to be aware of them.

In theory if you only have 10 in stock, then you only have 10 to sell. By exposing your inventory across just 3 platforms in the example above, you are actually exposing 30 items and again in theory if they all sold at the same time, you could go to a negative inventory count of 20 (that’s the 30 sold, minus the 10 you had in stock).

The Channel Profiler is a process that runs on eSellerPro’s servers and it does not update the marketplaces instantaneously, there is a time lag on eSellerPro’s side and with the marketplaces themselves. While I now don’t know the exact figures, a period of about 30 minutes would be about right for each passing of an eSellerPro account to make updates to the 3rd party platforms.

We also need to understand that eSellerPro is a 3rd party to the marketplaces and as such there are time delays in the communication to them. Again referencing the earlier example, the orders from eBay & Amazon are not picked up instantaneously, they’re scheduled. Plus we also need to account for time delays in the marketplaces themselves, Amazon orders are not immediate, they tend to sit for 15-30 minutes before being released and also you can only ask for order reports every 30 minutes or so.

So it’s perfectly possible for Jane and Jim to buy on two different marketplaces within a time window of say 10 minutes and eSellerPro is not capable of updating the other channel to let it know there is a deduction of the inventory level, if there was only one left, this could have caused an oversell or back order. Hardly ideal.

It should also be noted that in relation to eBay, eBay auctions and BIN listings of 10 days or less, are regarded as being committed to the eBay marketplaces, thus if you have 10 in stock and 2 of those are in two auctions, then eSellerPro sees an available stock count of 8 and will use this value to keep the platforms updated.

Note: You can use the true stock level of 10 called “Percentage of On-Hand”, however this is where you’re most likely to be caught out, as using this option I strongly advise you never to use this option (although there are situations where it does not matter, such as virtual or limitless stock).

Channel Profile Tolerances

The channel profile process also has “tolerances”, for items over a stock count of 20, there is no compelling reason to keep the selling platforms updated with the latest stock count for each change.

If we had 10,000 of those mugs in stock, then updating them every time we sold one would be silly and slow down the really important updates for other stock items which have much left. As such eSellerPro has different tolerances for different stock levels and they can be found in their Wiki.

A Simple Example of a Channel Profile

A really simple example of a channel profile is the first example, where we were listing all 10 of the mugs on the 3 platforms. In this example we are committing 100% of  the “Available stock” (10) to each of the channels.

An Advanced Example of a Channel Profile

There is likely to be situations where you don’t want to commit all your stock to all of the channels all of the time and this is where the ability to create multiple profiles comes in really handy.

For the first example, we would have named the channel profile something like “List 100% to eBay, Amazon and Our Website” (naming the profiles to what they do is again strongly suggested, it makes them “Matt proof”).

For this second example, we’re going to want to keep two of mugs in stock at all times, this is because they’re end of line and we want to keep safe just in case we get a return of breakage.

Similar to the previous example, we’re going to commit 100% of the “Available Stock” to platforms, but we’re going to add a number 2 to the column called “Min. Qty Avail”. By setting a value of 2 in this column, we’re saying list 100% of our stock, but when we get to our last 2, take them off all the platforms.

We could of course just set this value of 2, to just one platform, so that when we get to our last 2 items, we take it off Amazon, but leave the 2 on eBay and the website. I did say that this was ‘neat’ :)

Further Examples

The abilities of the channel profile doesn’t stop at just listing 100% of items onto marketplaces and keeping their stock levels in-tow and basic stock control. You can also configure a channel profile to use these cool features:

  • Percentage based listing, not just 100%, maybe only 50% to eBay and 100% to Amazon & the website.
  • Force set inventory levels onto one or more marketplaces, that never go out of stock
  • Force set inventory levels onto one or more marketplaces that are removed when the available quantity drops below a specific level
  • Using a “Cost Formula”, dynamically calculable your selling prices for each channel and also the minimum and maximum prices for Amazon & Play.com accounts.
  • Cap the number of listed items on a platform to a maximum number
  • And there are some funky things you can do with sequences and stocked sub skus of products that 99.9% of the people reading this wouldn’t ever use.

It should also be noted that if you have the WebXML interface enabled for up to 10 external channels, the channel profile can also apply inventory update rules to these too and via the new eSellerPro API, the status of the SKU can be checked to see if its been set to list on several of the ‘channels’ in the channel profile.

My eSellerPro Channel Profile Tips

Here are a collection of tips that you may find useful:

  1. Never edit the default profile
    Think of this profile as a off switch, keep it set to manual and use this profile to take items off all the platforms and for new records that are not ready to be listed yet.
  2. Keep calculations to a minimum
    The more you ask for a channel profile to do, the long it will take and the slower it will run. Where ever possible, keep calculations for prices to external tools lke excel or PHP before entering into eSellerPro.
  3. Never use product specific channel profiles
    If you create product specific channel profiles, you’re missing one of the huge benefits of eSellerPro ‘profiles’. If you do have an exception product that needs its own rules, just create another profile and name it accordingly. Then ALL your profiles are in one place and easy to administer.
  4. Name the channel profiles sensibly
    If the profile is listing 100% to eBay, Amazon and the Website, name it that. In the bulk update tool, in the inventory record and in the import/export system you only see the names of the profile, thus name them clearly in relation to what they actually do.
  5. Think through each channel profile thoroughly before creating it
    Take a few moments to write down what you want the profile to do, then once written, use this to guide you to the configuration of the profile.
  6. Use ‘Bulk Update’
    You can use the bulk update tool to update as many records as you would like, remember that naming them clearly will make this task a cinch.
  7. Import/Export with care
    Don’t forget you can import a channel profile name as part of the custom import/export sheets. But use this with care, as you can enable products to be listed from an import sheet, this may not be desired straight away and may cause other issues, especially if you are loading new products and images need to be collected from a 3rd party before listing, the listing may go live and be incomplete!

The “Channel Profile” Summary

Using a channel profile is not without its risks, as you can in theory oversell heavily if the products which have been assigned a channel profile are in ultra high demand, accounting for the lags of the platforms themselves and giving eSellerPro enough time to react (although in reality this is quite rare, I can only remember of two instances in 3 years of this happening).

Sensible configuration of your channel profiles for different velocity products is key and also keeping them as straight forward and aptly named is strongly advised.

The examples in this article are quite basic, however if you consider you may have thousands of inventory records, numerous eBay accounts more than one Amazon Seller Central account (yes this is possible), multiple websites and maybe 3rd part integrations to other selling platforms, being able to expose your entire inventory across ALL possible channels and keep them updated when items sell and stock deliveries are made, makes the “Channel Profiles” in eSellerPro one of the core parts of the entire system.

Try doing all that manually. You’ll have no hair left like me!

Your Feedback

Do you use the Channel Profile in your eSellerPro account, is this something you could or couldn’t live without? Let me know in the comments box below.

That’s Curious BrightPearl is Releasing a Magento & eBay Integration?

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Brightpearl LogoBrightpearl, now that’s a curious one.

It appears they’re adding a Magento & eBay link to their arsenal (see their shhhh page here) and I’m super curious!

If we look at the different SaaS (Software as a Service) providers out there, they’ve all originated from different angles:

  • ChannelAdvisor came from the perspective of eBay
  • And so did MarketWorks too
  • eSellerPro came from an order processing perspective, for which the marketplaces & listing were added later.
  • 247 TopSeller has hefty Amazon slant to it
  • StoreFeeder came from a Fulfilment perspective
  • Linnworks came from an ERP and MRP satellite systems
  • ChannelGrabber from a need to combine eBay & Amazon together

Brightpearl, Where Did They Come From?

As we’ve seen above each of these providers have come unique points of view and Brightpearl isn’t exception. Brightpearl came from two entrepreneurs and co-founders Chris Tanner and Andrew Mulvenna, whom was frustrated with the likes of NetSuite & Sage and how everything from a website (osCommerce) & accounting perspective was not linked and hindrance to his business at the time called “Lush Longboards”.

A years coding bender in 2006/2007 led to the development of Brightpearl, two investments later from Eden Ventures & Notion Capital, Brightpearl have over 6000 customers, a solid product that combines the features of a inventory management system, full-blown accounting (including purchase orders, quotes & invoices), contacts & a CRM tool (which is excellent I hasten to add! They’ve extended the Rapportive extension that links with Gmail), a web-based EPOS system (this is very cool) and an eCommerce offering for integrated websites.

Recently Kate Gover from Lahloo Tea discussed how Brightpearl helps her business. The video is below:

When I met the team at Brightpearl last year (hola!), the irony was that the businesses using Brightpearl felt it so valuable to use Brightpearl for their online channels that they were manually importing sales orders from other sales channels like Magento, eBay & Amazon, so that they can leverage the functionality of Brightpearl to its full potential.

eBay can get deep very quickly and Magento API is pretty poor currently, especially if you want to do complex tasks. I don’t know how far they’ve gone with the integrations yet, but even if they’ve done the basics such as stock control and order aggregation, it could be pretty slick.

Now it’s looking like they are adding a Magento integration and an eBay integration…. From a different perspective, that of website & accounting, that’s why I’m curious.

You can find out more about Brightpearl on their website and Shhhhh page where I found this information is here http://www.Brightpearl.com/shhh.

What is an Amazon Product Detail Page?

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Hola! In this article, I introduce you to the Amazon product detail pages and the different variations of the detail page for products on Amazon.co.uk

If you’ve never sold on Amazon, are looking to do so or are already a seller central merchant, then taking a few minutes to watch the video in this article will help you and your staff understand what an Amazon detail page looks like and the variations that they come in. Because they’re not all the same as I show!

The Amazon Product Detail Page

The product detail pages on Amazon can and do change between product types. In the video below, I take you through some of the common components found on an Amazon product detail page such as:

  • Images
  • Videos
  • User-contributed content
  • A Product Title
  • Variations if present (Size, Colour and Size & Colour)
  • Pricing information
  • The ‘blue buy box’
  • Frequently bought items
  • What do customers ultimately buy after viewing this item
  • Product specifications
  • Technical details
  • Product details
  • Product description
  • Customer reviews
  • Tags & several other elements

While not an exhaustive list as Amazon just like their product detail pages, do change the layouts from time to time,.

Anatomy of an Amazon Product Detail Page – Part 1

This video is part 1 of a multi-part video series that covers the anatomy of an Amazon product detail page from the basics in this article, to show how the inventory data you create, rules, options etc.. can impact what is shown on the detail pages for products you create on Amazon.

Reference Links

In this video, I show several pages on Amazon.co.uk, you’ll find visiting these for yourself very useful (as I have sped through some parts of them on the video) and I’ve included direct links to them below:

Summary

You now have a great founding in what Amazon product detail pages look like, the variations of them and the common components that you’ll find on them. This is crucial if you’re intending to sell on products on Amazon and also if you are already selling on Amazon as I’ve come across businesses in the past that didn’t know that you could list products with variations on this marketplace.

As I’ve shown in each of the product detail pages, there are several key sections that when creating your inventory for sale on Amazon, then you need to be fully aware of these sections. It can be tempting to skip sections and not know what the repercussions of missing them out are or what the sections in the import sheets actually mean in the first place.

If you’re thinking about selling on Amazon or already are and would like to know more, then checkout the Amazon category here, as I will be adding the following stages to the article over the next few weeks.

Like this video & Article? Let me know by either leaving a comment below!

Have You Received a Price Parity Policy Warning from Amazon?

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Amazon LogoHave you received a “Your Amazon Seller Account: Policy Warning” that details two products that have the pricing issues when compared from your Amazon selling account to your website? If so read on and if you haven’t yet, it appears Amazon is doing the rounds.

Update: You’ll also want to check this article out as Amazon are now notifying businesses that are falling behind on their response times Amazon Policy Warning For Buyer-Seller Contact Response Times.

I’ve seen this a couple of times so far this year already (and several times last year too) and after the concerned email yesterday, its about time I cover this in more detail. We all know that price parity across all sales channels is ni-on impossible and I’ve included some practical advice at the end of this article on how to tackle this issue.

I’m sure 99% of you are not well versed in actual agreement that was agreed to when you first started selling on Amazon and in my breakdown the price parity that Amazon expects isn’t going to be pleasant reading, hence the inclusion of some suggestions.

The Amazon Price Parity Policy Warning

There are numerous policy warnings you can receive as a seller on Amazon (frankly none of these are good) and this article is focused towards the price parity warning titled “Your Amazon Seller Account: Policy Warning” that is being sent out by Amazon to sellers ‘Performance Notifications’ section of your seller central account.

An Example Policy Notification

I’ve stripped the product details from this notification to ensure the sellers details remain anonymous, however I will be including ‘example’ prices as we’ll need these later in the article.

Amazon Policy Warning Price Parity Email

An example of an Amazon Policy Warning Price Parity Notification

Its also worth noting that for two of the notifications I’ve seen so far, Amazon have quoted prices from Amazon Webstores, which is there website offering so this doesn’t just apply to sellers using 3rd party websites, this also applies to sellers using Amazon’s own website product too.

The text version of this notification is below and I’ve highlighted several sections in bold as we’ll be looking at these later in conjunction with the Amazon agreement.

Greetings from Amazon,

We are writing because it has come to our attention that some of listings may be in violation of our policy concerning price parity. Customers trust that they’ll find consistently low prices and other favourable terms on Amazon. To help preserve this trust, we generally require that sellers who choose to sell products on Amazon not charge customers higher prices on Amazon than they charge elsewhere. For products you fulfill, this typically means that both the item price and total price you charge customers for a product on Amazon must be generally at least as favourable as the item price and total price you charge customers on other sales channels.

– The “item price” of a product generally means the price of the product itself.
– The “total price” of a product generally means the total amount payable by a customer for that product, including discounts, rebates, promotions and shipping.

It has come to our attention that some of your listings do not abide by this policy. Example listings are provided below. Please review all of your listings to ensure they abide by this policy.

For more information, please refer to Section S-4 (“Parity with your Sales Channels”) of the Amazon Services Business Solutions Agreement, available in the Policies and Agreements section of seller Help.

We appreciate your cooperation and thank you for selling on Amazon.

Regards,
Seller Performance Team

Example listings:
Example ASIN: < ASIN 1 >
ASIN Title: < Product Title 1 >
Date: < Date > (London, UK)
Total price on Amazon.co.uk: £65.19
Total price on <Website>: £59.49

Example ASIN: < ASIN 2 >
ASIN Title: < Product Title 2 >
Date: < Date > (London, UK)
Total price on Amazon.co.uk: £10.96
Total price on <Website>: £8.99

Understanding the Warning

So lets cut the crap here and understand that Amazon want you to have your products listed on Amazon at the best prices possible, including their commission of sale and this is their way of pointing out that on some of your products that there is a difference and they don’t like that.

So picking up on the two points from the Amazon notification email:

– The “item price” of a product generally means the price of the product itself.
– The “total price” of a product generally means the total amount payable by a customer for that product, including discounts, rebates, promotions and shipping.

They’re not holding back here and want to factor in all the factors to the total price “including discounts, rebates, promotions and shipping” (which is part of the agreement I cover in a few moments), so if you’re running say an email marketing campaign with a special promotional code, according to Amazon, you should adjust your prices to match this offer (more on this later).

Its also interesting that they’re quoting the “Amazon Services Europe Business Solutions Agreement” in the notification and explicitly the section S-4. The full agreement can be found on the Amazon website here.

I have included an extract below (correct at 29 Jan 2011) of the policy section S-4 and this is in bold and my own comments are in the quote bubbles.

S-4. Parity with Your Sales Channels

Subject to this Section S-4, you are free to determine which of Your Products you wish to list for sale on a particular Amazon Site.

So you’re able to choose which products you list on Amazon and which products you don’t. (That’s nice)

You will maintain parity between the products you offer through Your Sales Channels and the products you list on the a particular Amazon Site by ensuring that at the applicable Selling on Amazon Launch Date and thereafter:

(a) the Purchase Price and every other term of offer and/or sale of Your Product (including associated shipping and handling charges, Shipment Information, any “low price” guarantee, rebate or discount, any free or discounted products or other benefit available as a result of purchasing one or more other products, and terms of applicable return and refund policies listed on such Amazon Site) is at least as favourable to users of such Amazon Site as the most favourable terms upon which a product is offered and/or sold via Your Sales Channels (excluding consideration of Excluded Offers);

The selling price for your products must be at-par or more favourable to Amazon buyers when compared to your other selling channels.

(b) customer service for Your Products listed on such Amazon Site is at least as responsive and available and offers at least the same level of support as the most favourable customer services offered in connection with any of Your Sales Channels (provided that any such customer service will at all times be conducted in a timely, professional and courteous manner) (this requirement does not apply to customer service for payment-related issues on Your Transactions, which we will provide); and

Customer service should be uniform across the channels. That’s an assumed factor.

(c) the Content, product information and other information under Section S-1.1 regarding Your Products listed on such Amazon Site that you provide to us is of at least the same level of quality as the highest quality information displayed or used in Your Sales Channels. If you become aware of any non-compliance with (a) above, you will promptly compensate adversely affected customers by making appropriate refunds to them in accordance with Section S-2.2.

Read this section twice. That’s right, if there is a price difference between your sales channels and your Amazon sell price for a completed purchase is less favourable to an Amazon customer, then you are expected to compensate ‘adversely affected’ customers.

From my notes later in this article, it appears that this threshold of ‘adversely affected’ is a 9% or greater difference between Amazon and your other sales channels.

For Amazon-Fulfilled Products, we acknowledge that if the shipping and handling charges associated with the sale and delivery of any of Your Products listed for sale on such Amazon Site are included in (and not separately stated) the purchase price listed for Your Product on such Amazon Site (collectively a “Shipping Inclusive Purchase Price”), then the parity obligation in (a) above will be satisfied if the Shipping Inclusive Purchase Price and each other term of offer and/or sale for the product on the particular Amazon Site are at least as favourable to users of such Amazon Site as the purchase price and each other term of offer and/or sale for the product (including any and all separately stated shipping and handling charges) pursuant to which the product is offered and/or sold via any of your sales channels other than the particular Amazon Site.

FBA is a special case and they’re acknowledging that there are other costs associated for sellers for this method, but is still to be factored in when it comes the first part (a) for price parity.

Where Did Amazon Obtain the Prices From?

Please understand that because almost all of the notifications I’ve seen have come from different website products, then someone from Amazon has quite likely been through your website manually to check these prices. Also from the emails I have copies of, two use the Amazon Webstore product. Even if you use this to run your website selling activities, you’re not immune.

Note: Amazon could of course used ‘Google Shopping’ to check the prices. But because of one of the prices quoted in one of the notifications, I don’t believe this is the case or if they are, they’re manually verifying on the sites.

While a date stamp is included, no time is included. Which is a shame as we would been able to pin-point exactly the source of the user agent used to check the prices on the external website, but is also a point we shouldn’t overlook as, its an exclusion that can be used as a battering point because most businesses use repricing software for the channels and it could be easy to argue that between software updates, that the prices are likely to be out-of-sync with each other across the sales channels.

The Threshold for ‘Adversely Affected’ Prices

This is a curious one, as what actually constitutes as ‘adversly affected customer’? This is where having a unique view across different businesses comes in really handy.

I’ve looked through the notifications, taken note of the percentage differences between the Amazon price and the website selling prices and there seems to be a correlation between them.

Using the Amazon 15% commission range as a common key across the notifications, in all the examples I have, the selling price difference is 9% or higher between the price being stated that was on Amazon and the price being stated.

To be fair to Amazon, in pretty much all cases the selling price difference was a lot higher than 9% more on Amazon compared to the businesses website and on several of them, the prices had a difference of over 30%. So if you’re asking yourself is this warning warranted, it probably is!

Reality Check

I personally see the policy warning as a poke from Amazon to say:

“hey you’re prices are out, can you keep them in-line with us please”

While I understand why Amazon would like to ensure that their prices are the most competitive for their customers, even in their own agreement they’re using terminology that allows for some lea-way in the pricing between selling channels such ‘adversely affected’ and the term ‘generally’ is used twice in the notification itself.

It appears that this definition of ‘generally’ is in the region of a 9% or greater price difference between Amazon and another sales channel and as per my comment earlier, in the cases I’ve seen so far, the examples given were a lot higher than just 9%, with several over 30% and looking at a per SKU level, maybe the pricing is out and the warning was founded.

I’ve not seen (as of yet) Amazon do a re-run of a price parity check on accounts, however if they were to, I’m sure if you or Amazon dig deep enough into any business that is using more than one sales channel that you’ll find a difference in prices.

Whether Amazon actually take this further than my interpretation of it being a reminder to “play fair”, only Amazon know. As such, I’ve put together some suggestions that you should find useful, no matter what your account size or back-end software:

  • Use the Amazon selling price as the website price
    Now before you scream “NO WAY!” at this as you’re likely to command a better price on the website than on Amazon, remember the reach that Amazon has to potential customers and even if you do your best to keep within say a 9% window of price differentiation, Amazon is most likely a far larger sales channel than your website, probably for eternity.
  • Export & Cross compare Prices in Excel
    As the likely hood is that there are you’re using a variety of different software platforms to run your websites from I’ve not included an excel example, however the process is really straight-forwards, IF you have used the same merchant SKU over your channels or another key that allows you to cross compare your inventory from different channels.An example would be to use eBay File Exchange to export your eBay listings, an Amazon ‘Inventory Report’ export from the “Download Inventory File” section in Seller Central and also an export from your website. Then using the VLOOKUP function in excel (see this link on YouTube for examples) to cross compare prices and run as a percentage in a column extra.
  • Repricing Software
    With almost all decent repricing software for Amazon, you are able to set an ideal selling price, a minimum and also a maximum too (if it doesn’t Google ‘channel max). Ensure that these are taking into account your website prices, so that you try and keep within the 9% window or maybe… work the prices backwards to your website.
  • Percentages!
    Its really easy for anyone (like Amazon or a customer) to point the finger and say “well for that SKU the price is different”. What I would suggest as a practical measure is that you point out to Amazon (probably not best done to a customer though) is that if you cross compare the prices globally across you selling channels (using the tip above) that “on average” the selling price differences between the channels are within X window and that if they look at individual cases, then they’ll always find fault. But as a overall picture it should be relatively easy to prove that you do keep your prices in-two with Amazon’s expectations

Your Feedback

And finally:

  • Have you received this notification too? 
  • Have you spoken to Amazon support regarding this, what was their reaction?
  • Did you make any changes to your pricing? 

Let me know in the comments box below.

The Top 8 Pitfalls of Using 3rd Party Software To Manage Your Business

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“I thought using 3rd party software to automate my online business was one of the best decisions I ever made?”

I asked myself this question back in November last year, since then certain events have happened and  I strongly feel that adding software to manage repetitive parts of an on-line business is a sensible move.

This is to the point that it doesn’t matter which tools you use, as long as they’re automated and take less work than processing the tasks manually would take is a good thing. However, sometimes the pitfalls are overlooked and in this article I delve into these.

Setting the Scenerio

Let’s make a fictitious company called “Widgets Ltd”.

This company started from one person and as the business model was proved, several members of staff were added and a team formed.

Widgets Ltd sells on multiple channels, they started with eBay, dabbled with Amazon and also have their own website, they also have a trade site and a trade counter with a simple till, with no real stock control over any of the platforms.

Approximately a year into the business, multi channel software was employed and while this took a few weeks to employ & for the staff to get up to speed, due to the forced efficiencies of the software, better stock control & they looked at Amazon more seriously, sales grew within a few months, compounded by a seasonal period, sales figures rose to levels they’ve only dreamt about and everything looks rosy.

Pitfalls, What Pitfalls?

On first glance, Widgets Ltd has done really well, mainly because they got past the one person stage and had a business model that worked at small scale, with efficiencies through the use of software,  the business was able to amplify the model worked and allowed them to add the important factor scale and grew.

As I suggested, everything looked rosy. More & more money going through the business, everyone looking busy, feedback rocketing & receiving some real kudos from their family, suppliers & friends.

To quickly clarify, automation especially when it comes to labour intensive tasks is a generally a “good thing”. By automating these tasks, it can allow the business owner(s) to work on their business and not always in it. Purely because of this, this is why most 3rd party tools are a positive to their business, to a point that is, which I’m making in this article.

The moment you add software to automate a process, you become removed from it and this is the stem of majority of the issues that 3rd party software creates.

However, I’m going to take the most basic of examples, probably the most highly desired automated process of them all, leaving feedback on marketplaces such as eBay.

Can you remember when you first started on eBay? You probably bought a few items and gained some feedback, you then started selling a few items and leaving feedback was a personalised affair, tailored to each customer, you were leaving them manually and keeping a keen eye on what buyers were telling you.

After all the rest of the selling process was probably all manual as well and you knew everything about the products, listings, questions, orders, customers etc… However the second you automate one of these processes, you become removed and tend to focus on the visually detrimental parts, such as neutral, negative feedback & DSR scores and forget about the positive comments that may hold the key to moving forwards with the business.

And that’s why it’s quite easy to identify the pitfalls, because the dangers are all around the business when automation is employed and this is what I have dedicated the rest of this article to.

The Eight Common Pitfalls

There are way more than just eight of them, however, these are the common occurrences.

  1. Not at ground level any more
    As I suggested in the simplest of examples above, when you automate processes, you can easily become removed from the ground level and only focus on the bad points, rather than the good points that become overshadowed. This happens throughout the business, as the decision makers become further removed the ground.
  2. Mistaking marketplace growth for business growth
    Focusing on eBay & Amazon, these sites have seen double digit growths over the years, however eBay has slowed down & Amazon has picked up pace (on a global scale), however we’re not seeing huge growths with eBay anymore and it can be misleading to assume that the 5-25% growth in your business has been to the effects that your actions have had, rather that the marketplaces have grown by these numbers and you’re riding the wave.
    Note: This is discussed in detail in two articles called The eBay “Best Match” Position Bias Modifier Hypothesis and Why do eBay Sales Stay Consistent?
  3. Unable to identify trends effectively
    This goes back to the ground level view again, when the business in the example above Widgets Ltd was only one or a few people, it was easy to identify which products were moving and which ones we not, because the staff knew them intimately. However as the owners moved up the ranks, they became further & further removed from the front lines and if the software that they’re using is able to report on data their business is generating, then can lead to the business hitting a plateau and no-one knowing why and in the next one the most lethal of them all is covered.
  4. Happy with the businesses performance
    Some business models have a natural plateau point in them due to the factors that make the business up and while adding automation to a business can remove most of the softer walls to a business to progressing, if we combine a spike of growth over a few months and the owners becoming complacent, the business becomes ‘happy’ with the current results and doesn’t take a serious look on how to expand further.
  5. Unhappy with the businesses performance
    And a complete inverse of the above is that the business owners may mistake the automation of their systems and growth of their business as a huge demand for their offerings, when in fact the automation part, just allowed them to work more effectively, focused on a few key issues like stock control, sourcing, customer service and order management, but continuously expect the same amount of growth of the business that the employment of automation first provided.
    I have one question for this, do you define success as a business that lasts 10 years with ever decreasing profitability or a business that lasts 10 years and keeps a competitive advantage and a decent profitability? Maybe both are right, but which one do you automatically get pulled towards?
  6. Unsupported or time lag to new features
    When working with multiple marketplaces, things are bound to move. This is especially true of eBay you release updates every few months, some of which can completely alter the way that the marketplace works, such as best match did or the introduction of multi-variations (see earlier article here for examples), the same goes for updates to other platforms & software products, take a courier integration, they shelve the older version and you’re forced to the new version.
    Now imagine that your current software provider, that was previously automating the courier process is unable to support the changes for 2-3 weeks. That’s a scary thought & while I’ve never experienced a courier software change that inflicted weeks of failure in automation, it can happen and crucially does happen.
  7. Owners are not always good managers
    Before you draw insult from this, I am the first to admit that I am not a very good manager. People that are brilliant technicians rarely make brilliant managers. While they are outstanding at ground level, maybe creating code or graphic design, they can lack core skills to be able to manage people & businesses effectively. Employing automation can blur this, but without a core understanding of the processes required to scale or adding members to the team that can manage such roles, then this as I know all too well, can cause issues.
  8. Tell others about their automation tools
    I’ve personally seen this a few times now, where business owners have seen obscene growths in turnover have spilled their tools to others (either knowing or unknowingly) and competitors and even suppliers have jumped in too and taken the advantages the automation provides.
    While I’m not going to name examples of the latter, I can note here that one of the first tasks I made when using MarketWorks (a tool to automate eBay processes), the first task that I took was putting a layer on top of the MarketWorks logo that was automatically inserted in the listings, so that competitors could not readily work out which tool I was using.

Summary

While the above was not exhaustive and that 3rd party software products can provide huge benefits to businesses through automation, there are downsides to using them.

Some are obvious, such as competitors or even suppliers picking up that the business is using certain tools to manage their business and then using them to compete more fairly with the business, while others less succinct issues like the owners not being competent managers, or time lags in changes to marketplaces or being unable to trend their business can all impact a businesses effectiveness.

Image Source

I Dared Amazon to Deliver And They Did!

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I’m going to share with you a short story with you about my Christmas shopping experience with Amazon and the thing is, only Amazon would have delivered that special Christmas day experience and only in Amazon I would have put my faith in to do so.

Setting the Scene

Christmas eve fell on a Saturday this year. Judging by the amount of people getting drunk & updating  Facebook, it was an all round good thing for many. But not if you’re a Dad and hadn’t bought that token present yet for the girls.

Don’t get me wrong my oldest isn’t even four yet, so the whole Christmas experience was going to be amazing whatever happened but fulfilling my appointed duties as a father, I felt it required that I deliver the token Christmas present.

The thing is, it was Friday, Christmas eve was tomorrow! I had already been around the shops the day before and managed to scrape a win with some glasses & a stunning photo frame for the far-better-half. But the girls, they had plenty of toys but were missing that one present that I know that they’d use all year. As a rather late decision, I had set myself on getting the girls a Nintendo Wii. The problem was, checking the stock pretty much everywhere in Bristol there were none and it was Friday!!!

Amazon was still offering next day delivery on the bundle if I ordered before 11 am and I believed that the Mario Kart version would be a great choice and had already arranged for the Resort disk to be borrowed from a friend for a few days (which reminds me we need to give that back).

Lost Orders

I have been an Amazon Prime subscriber for the past year or so. I’ve enjoyed next day delivery on almost all items (after all, I like almost every other Prime subscriber go for the Prime items first), however one book I was really looking forward to reading called “Nice Girls Do Get the Sale” (aff link) had got lost/stuck in the Bristol hub of HDNL (Home Delivery Network Ltd) and had to order again.

It took a couple of emails to Amazon to get it refunded and thinking aloud, it must be pretty obvious which customers are taking the piss with fake lost items, as I had already ordered a duplicate from Amazon, as I had heard the book was really good and wanted to read it (it was and is now out on loan).

My estimation of HDNL was also pretty low anyway, personally I had not been that impressed with deliveries coming out the boot of someone’s car, although the one delivery person I did speak to around this time last year was really nice and we chatted about couriers and it turned out that she had worked at Parcel Force around the time I had a few years back.

That Sinking Feeling

So after hitting the buy now button you can imagine my heart sinking when I saw this in my Amazon account:

Amazon-Order-Wii

Yea, I wasn’t that impressed. I knew most of Bristol was out of the Wii & Mario Kart combo’s and I certainly was not going to flit around Bristol trying to get one (plus I had a meeting that morning), so deciding not to cancel the order and to see what happened next (can you imagine the article here that Amazon didn’t deliver?).

Delivery of Orders IS Part of the Order

The delivery of the order is part of the service from Amazon, as it is with any on-line retailer. They’re an extension of the business and a damn vital part of it too.

You don’t see an Amazon representative delivering your orders, you only ever see a 3rd party delivery driver.

This is one consideration that some businesses overlook, it doesn’t matter if you get every order out in super quick time, if your courier company then takes 2 weeks to deliver it, has no local collection points and their staff are rude (just making a point here, only ever met one “spanner” delivery driver and that was years ago).

WoooHooo!

My partner was on strict instructions to not leave the house until the package had arrived, also as I live up a couple of steps, we left the fairy lights on during the day just to give the delivery person some incentive to make the trip up them as there was a good indicator that we were in (yea I know the risk/reward calculation when faced with steps as a delivery driver, I used to be one).

I had just got to my 3rd place and was waiting for a colleague to arrive. I got the call, two boxes had arrived and not a scratch on them, WooooHoooo! Christmas was fab and the girls loved the Wii (so did Daddy, after all we did get the Mario Kart version ;) )

Are Amazon Nuts?

There is no way I would have ordered such an important gift from another well known Marketplace or any other site for that matter at such short notice and I placed full faith in Amazon to deliver what they had promised.

Thankfully Amazon (and HDNL) delivered, on a Saturday, which was also a Christmas eve. It would have been a completely different article if it hadn’t and also a dull’er Christmas for the girls too.

Every other business that I knew of, had already planned to add notices to their on-line operations way before Friday that week for last their last shipping & cut off times, where as Amazon, they took it to the line, (well 11am that Friday).

This raises an important question, if even I was not prepared to put faith in a 3rd party other than Amazon at a critical time, why should your customers do the same or at any other time of the year?

So my question is…

Would you have dared to make an Internet order, on a Friday before Christmas eve?

Comment in the comments box below.

The Top 10 (or so) LastDropofInk Articles of 2011

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In this article I recall my top 10 favourite and most notable articles of 2011 and provide a reflection on each of them.

2011 saw myself and the LastDropofInk site go through some major changes, the site got a complete redesign in August and that dead mosquito was finally laid to rest and a new shiny design was put into place. This also saw me step into the world of video too and my thanks to AndyLuckyShot for helping me with the introduction section to the video content, the comments that you all made around the quality of them and I also took the opportunity to explore some of the topics that had been on my to-do list for quite some time.

A quick count shows that I created over 100 articles for the year, for which I’m pleasantly surprised, as some weeks I’d add nothing and some weeks 5 or more articles in one hit. I openly admit that some of them were weak, however there are several that helped me (and hopefully you too) understand some of the complexities that impact the way we work and the way that the marketplaces also work too.

Top 10 Articles of 2011

These are my top 10 articles of 2011. There are a lot more than just 10 though, as many of them are interlinked or were created in parts that lead on from each other. This is why its easy for me to reflect on what was documented over the year as I can see the full picture now of where each article was going and how they were linked together.

#1 – Tesco Marketplace

Tesco LogoIn November 2010 we heard concrete rumours that Tesco were going to launch into the marketplace arena, the launch date kept slipping throughout 2011 and now its set for sometime 2012.

However that didn’t stop me pondering what positives could be taken from the existing two key players in the marketplace arena, eBay & Amazon and from niche sites like Etsy and to ponder what would happen if you could rewrite the marketplace platform from scratch.

The article was titled “Part 1: Battle of The Giants – Tesco V’s Amazon – Who Will Win?” and it quickly exceeded 25,000 words so I published the first part in January.

If you look through the comments you’ll see that I didn’t actually publish the latter parts of articles detailing the steps and USP’s that I felt that were needed to create a killer marketplace. After all, Tesco in my mind is the only company that I know of that could actually take on Amazon in the UK and make a serious dent.

I did get my chance to pass a few of these ideas over earlier this year, but frankly screwed the chance up as the person I spoke to, didn’t really comprehend what I was discussing and it was entirely my fault for not putting it into a language that they understood.

When Tesco finally launch the marketplace, it has the potential to make a minor dent to Amazon’s trade, but sadly I suspect it will not be the marketplace that so many businesses are looking for to provide viable alternatives to the major players eBay & Amazon.

#2 – SEO for eBay – 10 Minutes Per Day

elephant-car

See even elephants need spoonful sized mouthfulls too. Yummy

While this article only scratched the surface, the important note was made.

That being that even with 10 minutes per day, the cumulative effect of lots of minor changes over time would become a huge positive.

The article titled “How to: SEO for eBay – 10 Minutes Per Day” first tackled the perception that it’s a large job, but a spoonful at time was perfectly manageable and then moved into the 5 key areas to focus upon.

#3 – Making Sense of the Pending eBay UK Updates in May 2011

girl-cryingAfter deciding to take a different stance towards the updates that eBay released in May 2001 (frankly, I had been too negative in some cases), I included my favourite image and quotation to date.

As far as I see it there are two options
#1 You cry like a little girl
#2 You fully embrace the changes in advance

There are two types of sellers on eBay, serious merchants and ones that chuck their toys out of the pram and cry at every turn. This was a prime opportunity for me to poke fun at the latter and help push the former seller types forwards with information that they could actually use to embrace the changes.

In these updates we saw the fee structure change for eBay, mainly for the better, multi-variations go live in many more categories and also the reincarnation of the failed eBay express checkout, adapted to a shopping cart and what we see now on eBay UK today.

#4 – eSellerPro (x2)

eSellerProI can tell you neither of these won me any browny-points, but as far as I am concerned they needed to be written and I’ll explain why now. This is actually a combination of two articles, the first is “The Unofficial History of eSellerPro” and the second being “Are There Alternatives to eSellerPro?“.

In the unofficial history of eSellerPro article, I pointed out the incubation factors that led to the creation of eSellerPro. There were a couple of factors, but the two main ones were the failing of both MartketWorks and ChannelAdvisor to adapt to the UK market fast enough.

The incubation period didn’t just spawn one new product/service provider (that being eSellerPro), it actually spawned at least one more within a 2-3 month window. Sadly [for eSellerPro, which was a product that I personally worked on to solve, not hinder merchants], with hindsight at my side, I now understand that there are specific conditions right now, that will spawn a 3rd generation take (they’re different, but they’re there), for which we’ll probably see arrive publicly by late 2012.

To add to this statement, I’m not part of this, but I am open to offers as CEO or evangelist. You can contact me directly here to discuss further.

This feeds nicely into the second part of this section, as when I wrote the “Are There Alternatives to eSellerPro?” the whole point was that you[as a merchant] should not change providers at all, instead try and look at the provider differently and solve the issues  that were hindering your business differently.

#5 – Affiliate Networks

Again this is a combination of articles, all focused around affiliate networks as an additional sales channel . It’s a topic that I am looking forward to expanding in 2012 and I will be posting more on in 2012.

  1. Part 1: What Are Affiliate Networks & Should I be using Them?
  2. Part 2: What Are Affiliate Networks & Should I be using Them?
  3. The Top UK Affiliate Networks

Affiliate networks can offer a new sales channel for medium (and larger) sized businesses and not just larger corporates. As the entire channel is pretty much working on “commission  on confirmed sale”, this is very similar to the eBay & Amazon marketplaces, just that it takes longer and the overheads are different.

To keep this as easy as possible for you:

If you’re paying over £300 a month to eBay or Amazon and have a website that is half decent, then affiliate networks should be seriously considered.

#6 – Using eBay Shop Keywords to Leverage the Extra eBay Shop Pages

eBay Shop keywordsThis was a fab article for myself (and you hopefully), as I had been meaning to complete this for months.

After finally sitting down and taking the time to document the eBay Shop  keywords that can be used in the custom pages of eBay shops and included plenty of examples, it turned out to be a thorough article and also lead to the article I was aiming to do which was another titled “How to Make Your Own eBay Daily Deals & Weekly Deals”

#7 – The Book Responsible for Where I am Now

“I owe everything to this book and if I can learn its contents in a week, in a caravan with no computer, you can too.”

I can actually tie the reason why I am where I am today down to a single book. There’s no need to explain this further as I made a video especially for this which is below:


Video not showing? Click here

#8 – The E, A, S & Y Model

In 2011 I was able to hammer out an approach that was simple to follow and would allow me to take a structured approach that both myself and clients could easily work to, helping them with their businesses.

I wanted this to be as easy as possible so I named it as “EASY”. The crux of this model is outlined in three articles, these are:

  1. E is for Efficiency
  2. A is for Add more Sales Channels
  3. S is for Stock
  4. Y is for why or who is doing it

You’ll notice that there is no dedicated article for the Y part, this is simply because its not a speciality of mine and as such I have drawn the line at this point. The first 3 stages will impact the fourth stage, however this stage requires skills and experience that I just don’t have and if you have the first 3 stages licked then your game is huge!

#9 – The Limits of Marketplaces

Why do eBay Sales Stay ConsistentI had first wrapped this up as a ‘conspiracy theory’ in late 2010, but actually that was bollocks.

Marketplaces such as eBay & Amazon have limits, they were once thought of as having unlimited growth and merchants shouldn’t have any reason at all to stray from just one or both of them, because all the customers they could possible reach were there.

As 3rd party software as developed and evolved over time, its allowed businesses to sell over multiple channels and even on the same channels but under different persona’s. Reaching a wider and wider audience. We’ve seen this in reverse with larger corporates (see this article) now leveraging eBay & Amazon in a trend which is likely to peak in 2012, as they realise that these marketplaces are viable, complementary channels for their existing operations.

Such limitations were first covered in the article “Why do eBay Sales Stay Consistent?” in September 2011 and I am now 100% sure such a modifier that I discussed in second the article “The eBay “Best Match” Position Bias Modifier Hypothesis” is actually true. Its true because with the unique view that I have had over the past few years as proven it to be the case and ironically its exactly what I would do!

#10 – UnderstandingE, code-named “ProjectE”

understandingeAfter flirting with this idea for years, it wasn’t until someone approached me with a similar idea is when the wheels started to turn on the original idea earlier this year.

I had the huge pleasure of working with 6 people (not businesses) after making a rather public and free commitment to 5 businesses in August for eight weeks. The first video of me making the commitment is here and the second video with a more formal invitation is here.

It was only meant to be 5 businesses that were included, there were +50 applications that I received and a sixth snuck-in. Ironically, it was the 6th that had the largest increase to their business post the eight weeks with growths of hundreds of percent and are now posed with operational issues that the other 5 had hit and overcome some time before. What a “good problem”.

This allowed me the opportunity to play with a few ideas I had and test them out, outside of my normal client base. The outcome wasn’t exactly what I expected, I discovered a new factor that I must include in the UnderstandingE business when its launched in January.

I’d like to take the opportunity to thank Jason, Gill, John, Paul, Sue & Danny for allowing me an insight into your businesses. What you allowed me to do was absolutely fundamental to the pending launch of UnderstandingE.

Summary

I know I’m supposed to summarise here, but one last article that is worth of a mention is an article I wrote about the Podcasts I listen to and one of my idols posted a comment back here on the site, the article and comments are here. This had everything to do with Dave and thank you, it made my year!

I’d like to thank you for taking the time to read the articles I’ve written, I’m hopeful that you have found them exceptionally useful.

What I have been able to do is create content that is timeless and while flirting with the UnderstandingE project and procrastinating on it heavily for months, I’m ending this article on the note that UnderstandingE is a go! And as such you’ll be hearing &amp seeing me a lot more in 2012.

3% of Sales Coming from the EU? Say Hello to the EU VAT Bomb

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If your business has been happily taking orders from around the EU and even if this is as low as 3% to one EU country hot-spot for a £1M turn over business, then you could be sat on an awkward issue regarding VAT.

This was another one of those ‘ah-ha moments’, although quickly followed with ‘wtf’ and ‘omg’ that’s going to be fun. In this article I do my best (as I’m not an accountant) to bring this topic into plain English.

This is certainly an issue that hasn’t been highlighted to businesses from either Amazon or eBay to my knowledge and is quite concerning eBay has been in such a push for Cross Board Trade (CBT) in recent months with statements that it fuels half a billion export boom and pushing the international site visibility upgrades and featuring eBay UK listings on the EU sites.

Disclaimer

Firstly lets clear a few points:

  • #1 I’m not an accountant
  • #2 I’m not a VAT expert
  • #3 I’ll never be #1 or #2.
  • #4 If you are #1 or #2 or have experience of this topic with your business, then fell free to comment and I’ll amend this article accordingly as needed.

That said let’s dig in and take a look a potentially nasty issue for medium to larger eCommerce businesses, because its really easy to go past the VAT limits, as they’re sooo low!

The UK VAT System

Starting from the beginning, VAT in the UK is pretty much a given. At around £73K of gross turnover or if expected to exceed this, a business is pretty much required to register to become a VAT tax collector and give the HMRC 20% of sales (and to be able to claim back the VAT on purchases and on expenses). This may not be technically correct, as there are deviants of this, but that’s the crux of it for most product based businesses.

So if you exceed or ‘expect to’ exceed ~ £73,000 of sales in one year, you normally need to register for VAT in the UK. Relatively straight forward so far. Yay!

The EU VAT Thresholds

Now this is where it can get nasty. As that expectation to exceed the threshold in the UK, also applies to business delivering products from the UK into the EU member states (called distant selling), but these states don’t all have such high thresholds when compared to the UK. In fact some of them are really low at around £30,000!

Let’s say you’ve been happily running a £1M p/a business that uses the marketplaces and also a couple of other sales channels. As you’ve been processing your orders from the UK, in most circumstances you’ve also bee taking orders from a wide variety of countries outside of the UK too.

The shocking reality is that if as little as 3% of these orders have come from one of the EU countries such as Austria, Belgium, Cyprus, Estonia, Finland, Greece, Ireland, Malta, Portugal or Sweden. You have an issue. 

Each of these countries have a VAT threshold of €35,000 (approximately £30K), when you hit this threshold then apparently you’re then required to register for VAT in those countries locally.

VAT Thresholds For European Countries (Sept 2011)

Doing some homework prior to writing this article, I found this document on the European Commissions website under Taxation & Customs Union. The middle section shows the thresholds for each of the member states in this document and I’ve extracted this to form the table below and highlighted the thresholds in bold.

Member State Threshold for application of the special scheme for distance selling
Belgium €35.000
Bulgaria 70.000 BGN (€35.791)
Czech Republic 1.140.000 CZ (€46.570)
Denmark 280.000 DKK (€37.557 )
Germany €100.000
Estonia €35.151 
Ireland €35.000
Greece €35.000
Spain €35.000
France €100.000
Italy €35.000
Cyprus €35.000
Latvia 24.000 LVL (€34.052)
Lithuania 125.000 LTL (€36.203)
Luxembourg €100.000
Hungary 8.800.000 HUF (€32.257)
Malta €35.000
Netherlands €100.000
Austria €35.000
Poland 160.000 PLN (€40.293)
Portugal €35.000
Romania 118.000 RON (€28.012)
Slovenia €35.000
Slovakia €35.000
Finland €35.000
Sweden 320.000 SEK (€36.232)
United Kingdom 70.000 GBP (€81.843)

Even with the approximation that €35,000 is £30,000, for a £1M p/a business, this is only 3% of sales and actually very easy to achieve by sheer accident into one or more of these countries.

It’s reassuring to know that the more likely culprits to top the £30K limit such as Germany, France & Italy have a much higher threshold of €100,000 or approximately £83,000, although in some circumstances, this could also be easily achieved without a second thought.

Summary

The aim of this article was purely to highlight and bring this topic into a ‘plain English’ format. I hope I have done that successfully.

If you even suspect that you’re likely to approach these figures to any of the countries above in your trading year, then please consult expert advice, such as from your accountant.

PS: If anyone knows how this applies to Amazon FBA items that are held in say France or Germany, I’d love to hear from you and please post a comment in the comments section below.

Why I See eCommerce Differently. I see Data & Lots of It Too!

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Introduction

When I look at a website, an eBay item, an Amazon item or pretty much anywhere now, what “I see” when looking at such products is starkly different to most. In this article, I share with you what I see and also why you should be thinking along the same lines also.

I would class myself as one of the lucky few that see the world of eCommerce differently. I see beyond the pair of boots, shoes, phone or dress and see a multi-tiered inventory structure that sits behind it. I also see beyond a single businesses perspective and have a unique view of many and can combine this into a single view, that’s not distorted by a single viewpoint.

In this article I share with you what I see, to help you understand the data that is sat behind the inventory that you interact with daily and why I strongly feel and know that data is the lifeblood of an eCommerce business.

What I See When I look at an eBay Item

eBay Item Data Points BreakdownWorking from the top down, I have highlighted the data points that I see in an eBay listing in the image to the right (to help the full version is here) and I’ve broken these down in the bullet points below:

  • eBay Categorisation
    But not just that, two eBay categories, the category numbers and the listing requirements for the categories being used.
  • The main image
    This isn’t just ‘an’ image, its an image that meets the requirements to cause the highlighted bar beneath it for zoom and enlargement which can only occur when the primary image is over certain dimensions. Also, the main image has been worked on to show the variations in the listing and also watermarked too.
  • Additional Images
    The images in this example have also been sent to eBay and using their hosting services, plus they have been worked on externally to get them to an excellent level (eg backgrounds removed)
  • Listing Title
    A keyword rich title that has been created to maximise the exposure from users searching. It’s also worth noting another data point here would have been the subtitle, but this listing is missing it.
  • Item Condition
    The condition of products has become mandatory in numerous categories now and there are several options for this.
  • Variations
    These require a special mention and the data structure sat behind this cannot be comprehensively covered in this article (and I am working on an article specifically dedicated to this alone). However for now, understand that what we are looking at is a master/container inventory record that has the core details about the inventory line, however its variations (and associated stock levels & pricing) are shown in both the “Exact Colour” and “Size” variation boxes. Some categories require for these variations to be labelled precisely, however other categorise the inventory data can be more flexible.
  • Quantity
    As this is a listing with variations, each variant has its own stock level, for example a small sized item may only have 2 in stock, whereas medium and large of a specific colour will most likely have different stock levels as sized/colour/variations all tend to sell in differing velocities.
  • Price
    This listings price is straight forwards, there is only one price for the entire style of products being shown. However, each variant may have a different price associated with it and attached to the data structure sat behind it.
  • Postage Variations
    I don’t see just £2.99, I see a tiered pricing structure that is likely to have come either a business rule for a templating system of some kind, that is displaying the default shipping method (as an eBay internal code) and a value. Plus the potential for 2 more domestic options to be selected, up to 3 more options for international and additional rules or specifics attached to them (eg a rate that is set specifically for Ireland). I also see either the postcode requirement or sellers location, along with the despatching country from a table of options, so that such an ETA of delivery can be made effectively.
  • Delivery ETA
    With each listing a data field needs to be set so that eBay are able to show the estimated delivery time based upon the sum of the sellers handling time and the default handling/delivery time of the shipping service selected as the primary shipping option by the merchant. This is why we see 2-3 working days as an ETA, not 3-4 if the merchant had included an extra day for their internal handling.
  • Payments
    Again I don’t only see the option that has been set to “true” to accept PayPal, I also see two more options, the first is that the merchant has added in the additional payment option of postal order/bankers draft, but also there is an account wide setting in their account that is set to “true” and thus displays PayPal as their preferred payment method.
  • Revisions
    This listing is handy as it shows that the merchant has also included revisions to the listing. This could have been manual edits or the entire reposting of the listing data itself from a 3rd party application and eBay have kept a record of this.
  • Item Specifics
    The item specifics being shown in this eBay listing are relatively light compared to what could have been filled out. Looking at these I see additional fields that can have either fixed options to variable options completed for them. Taking brand for example, eBay suggest a list of common brands to use, however in this case the merchant has selected to use “Unbranded” as their data point.
  • Listing Template
    This is hard to explain if you’ve had no interactions with templating based system. Looking at the eBay listing below the item specifics line where the bulk of the inventory data is displayed, the logo and all the stuff that makes it pretty, I see a HTML template that is most likely laced with keywords that are populated when the listing is sent to eBay from multiple data points.For example the description is pulled from data field, the smaller item specifics table from multiple data points, the image, even the description from another source and the about us/payment/shipping/returns tabs of data all being brought in from multiple locations, combined together and posted to eBay as the final finished product we’re now looking at.The same goes for the eBay categories down the left, I don’t see categories, I see a table of category names and eBay shop category ID’s that have just been spilled out into a human usable interface. Depending upon the 3rd party application that is being used to create the actual listing, I also see post listing logic. For example in more complex listings there may be IF/NOT logic that defines what is and what is not being displayed. Such functionality can completely change the entire way the data is displayed in the template and the final listing we’re looking at.
  • 3rd Party Attributes
    This listing has two, the first from the team at DZine-Hub and the second from eBay’s Selling Manager Pro.  Its not uncommon for several 3rd parties to be attributed at this part of the listing.
  • Business Seller Information
    While not posted with the entire eBay listing. I see this data coming from the settings that the merchant has specified in their eBay account. Again this is just data fields that have made it to the final version of the listing we’re looking at.
  • Returns Policy
    Having a different view from is also highlighted here, this data could have been sourced from an eBay default in Selling Manager Pro or its come from a 3rd party tool that has stored this data also as a default, most likely with the other template data.

You should now have an idea on how I see eBay listings and I can assure you its not in the same manner you have been thinking about it. I glaze over the product actually being sold and look at the use (or abuse) of the data that actually made the presented item(s) we’re looking at right now.

Ready for the next one? Lets continue…

What I See When I look at an Amazon Item

Amazon is special, well different when directly compared to eBay inventory data. Its different because the inventory data could have come from multiple sources, Amazon directly, that of merchants, a combination of both Amazon and multiple merchants and also user data as well.

To break up an Amazon listing into a more clearly defined image for you to understand, I have used two colours for this image and again the full version can be found here.

  • Red is merchant or Amazon product data
  • Blue is user generated data

Amazon Inventory Data BreakdownMerchant / Amazon Inventory Data

For this item specifically, because its already been created, then it could be looked at much more simply. What I mean by this is that due to the nature of how Amazon’s product database works, the merchant doesn’t need to know all the attributes about the inventory record, just the essentials to enable it to be sold.

These essentials are:

  • ASIN
  • Merchants SKU
  • Inventory Count
  • Selling Price

This makes selling on Amazon for merchants exceptionally easy. If they can match their data to an existing inventory record then listing a single or many thousands of items is very straight forwards.

However for completeness for this article, I’m going to assume that this item has been created by a single merchant so that we can explore the data sat behind what we’re looking at in full.

Merchant / Amazon Inventory Data

This section relates to all the red highlighted content in the image to the right.

Running with the idea that we (as a merchant) need to create this record from the beginning, when I see this listing, I see the following:

  • Root Categorisation
    Amazon works slightly differently when it comes to inventory data creation. Each root category (Apparel in this instance) has its own data requirements and then below that something called “Browse Nodes” which can be compared to eBay’s category structure.By the very nature of this item (being a shoe) its in Apparel category and is actually a sub version just for Shoes. The “Browse Nodes” don’t actually appear in this listing, but they’re there stored in the background.
  • Product Title & Search Keywords
    The product title is just one factor in the items being found in Amazon’s search, underneath this are up to 5 search keywords that essentially extend the title further. So just looking at the products title, I not only see a listing title, I see 5 data fields that are sat with this, they’re just not shown in the front interface.
  • Pricing
    I’ve purposefully chosen this record because there is a variation in not only the products (size and colour) but also because there is a variation in pricing from the numerous merchants that are offering this product for sale on Amazon.Unlike the eBay example where it was just a single merchants product being shown, we are looking at the cumulative of multiple data sets and multiple merchants all hijacking the same record to sell the variants of this product. As such we can see there is a price range from £23.50 to £86.84.While on the topic of pricing, I see much further. I see a minimum price and I see a maximum price, I also see that there is likely to be repricing software running in the background that also needs these and maybe extra data points to move the pricing around to achieve a higher, but profitable number of sales for each merchant. I also see such 3rd party applications with large data sets and complex rules, all in the aim of profitability for such merchants.
  • Variations
    With regards to Amazon there are four variation types, none, size, colour and size & colour. We’re looking at the latter and we have both size and colour variants being shown.However it doesn’t just stop are text fields from defined lists,  if you look at the colour options, you’ll see that some of these have smaller images, these are called swatches. When I see these I see additional data that has been processed by one or more merchants to improve the visibility for the user when making a selection.
  • Main Image(s)
    Again assuming that the merchant is to be posting this entire product and its variants from scratch, I see numerous images all held in data cells, but not just images of black shoes, I see rows and rows of data, each with their own sets of images and hopefully swatch images (for the variant) with them as well.
  • Attributes /Product Specifications
    Different Amazon root categories (not browse nodes) have their own requirements and available options for specification extra data that appears in both the product specifications section, but over-spills to the product details  as well, weight is a good example of this along with the item model number.
  • Bullet Points (missing from this example)
    Missing from this item are the display of upto 10 bullet points that describe this product further. Most merchants include just 5, however its possible to include many more than this via the API. Again all I see is cells of data that are being posted by a merchant and in this case not being displayed back to the user interface.
  • Product Description
    Amazon by far as the most primitive (or restricted depends on how you look at it) method of accepting descriptions. Again this is just a chunk of data that may just be a wedge of plain text or it could be the combination of multiple data fields being joined together to make a description. This product is quite boring in this respect as there are some fabulous examples of merchants that I have worked with to bring in numerous data points to the description to make the product more effective.

User Generated Data

This section relates to all the blue highlighted content in the image above.

Amazon is again special when it comes to product data because as shown by the sheer amount of blue in the image I’ve included there is an awful lot of user generated data that while not pure to the merchant side of inventory data, is when it comes to when the product data is displayed back to the user (especially after time, as more and more user data gets added to the original inventory data).

  • Reviews & Likes
    I’ve joined these together, although they are separate parts. Likes is just a counter of users hitting a like button, however reviews… they’re special. This is user generated content that can be absolutely lethal in the conversion of products shown on the marketplace. Personally I have bought expensive goods on the reviews of people I have not and will not ever meet. However if they’re bad then that’s pretty much sealed the fate of the product.
  • Customer Images & Videos
    The example above is actually a semi-decent one, as beneath the main image there is a link to 6 user generated images, these are images that users/customers have uploaded and have been added to this product. You can also add video content to products too.
  • Tags / Lists
    Lists aren’t really shown in the example, however an additional component to an Amazon inventory record is in the inclusion of customer generated wish lists, however tags are shown and these are again generated by users to help others locate similar products.
  • Purchase/View Driven Data
    Now this is where Amazon excels. Using the viewing and sales data (probably other sources too), they manipulate this data back to add several key features to a products detail page, the most obvious is the “Customers Who Bought This Item Also Bought”, however bundles can also be automatically created and shown to the user (not shown in this example), along with numerous other sections such as “What Other Items Do Customers Buy After Viewing This Item?” and other related products.
    The data that is driving this may not entirely driven by the actual product data a merchant(s) first created the record with, but multiple other data points to make the final detail page more productive to the conversion of the viewer.

What You Should See

It doesn’t matter if I’m browsing for a book on Amazon or in a “real” retail store, I can’t help it, I just see data. That can of beans, its a SKU and it has attributes (shelf quantity, store quantity, warehouse quantity, distributor quantities, variation, container size, price, cost, margin to name but a few) . That book I just downloaded to the kindle, its a SKU and it has attributes. The parcels that arrived this morning, just a by-product of inventory data.

This is only inventory related and only the tip of the iceberg. When you mix in multiple data sources, the complexities of data that needs to be ported to not just one marketplace, but many and then the order related data that then is obtained by making inventory data visible, business processes, supply & distribution chains let alone the countless other messes of data such activities creates. It gets deep and fast.

The way I look at the world of eCommerce and product driven commerce, looks completely different to most and I hope I have given you a glimpse of what I see when I see a lonely product shown on a website or just a tin of beans on a shelf. What do you see?

Data is the Life Blood of an eCommerce Business

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Introduction

Firstly let’s quickly identify whom this article aimed at and why on earth you should even consider reading the rest of this article.

I’ve personally spent over four years at 3rd party software providers working with businesses that have got themselves into operational & data issues that could have been avoided when it comes to marketplaces such as eBay & Amazon.

Some businesses have had no tool prior to moving into them and some have done but have made fatal mistakes along the way. Such mistakes have cost them untold amounts of wasted resources. This article is is aimed at helping you identify such issues as early on in the process as possible and to help you understand that data is the lifeblood of an eCommerce business.

New Businesses / Proof of Concept
This article is aimed at a brand new business that has just started exploiting the marketplaces for the first time, after all you need to have proof that the channels work and you need to start from somewhere.

Manual processes at this stage are a “good thing”, there is so much to be learned and as such the ‘manual’ entry experience is absolutely required, so that the people in the business understand the requirement for a tool as soon as possible and that they’re able to scale their operation.

Take the points on board now regarding data and look to the future of your business.

Businesses that have proven the marketplaces work for them.
This article is also aimed at businesses that have already proved that the marketplace channels are viable for them and are paying attention to them each day to manually load on products to the channels and most importantly processing orders from them too.

There is one exception to this, this is a business that has carried out substantial intelligence on the marketplaces and needs to leapfrog the basics and move straight to a large scale model as quickly as possible. If this is the case for your business, then you need to know how valuable data is and why you should retain it when it comes to the popular marketplaces.

As Your Business Grows

As the business grows bigger and bigger, normally by working (harder) on achieving one or all of these factors:

  • More inventory
  • Better priced inventory
  • More staff within the team
  • Adding more sales channels
  • Higher quality descriptions
  • Better order management
  • Lower operational costs
  • More profit
  • etc…

The cracks within the starting phase start to show very quickly, some identify this early on, some never identify it at all. Some unknowingly start to tackle this issue, but don’t actually realise why.

These could be through micro-management of staff & processes, after all most small businesses are rarely started & run by highly experienced managers, but by normal people and haven’t had the training or experience in dealing with such issues and I know personally that when I ran my own business, this is a trap that I got myself stuck in (and one that I’ve done my darn hardest to help others realise).

Putting internal management part aside and the other points above, what a small business owner(s) rarely tend to recognise is that “data” is one of core the reasons why they’re able to operate a business at all.

Data in a Business is Like Blood in a Human

Without blood, we’re pretty much screwed. The same as data within a business. Data is the lifeblood of the business.

This also ports to non-eCommerce businesses too, however is amplified by the very nature of the “e” part in eCommerce.

This article is entirely aimed at helping you understand that when you’re processing your orders in say eBay’s Selling Manager Pro, loading inventory to Amazon via spreadsheets or Seller Desktop, you are dealing with data. Your businesses data.

So when you’re ticking the boxes to print the orders out in SMP, using the sell your item form on eBay or adding items manually into Amazon using the add a product link. You are working with data, data that you should have absolute control over. It is after all the blood of the business.

Also the data that you are creating is exceptionally valuable to the business, the most obvious data is inventory data, however the not so obvious is the order data, that provides a unique history and insight to what the business has done.

So the moment you manually add inventory data into a marketplace like eBay or Amazon or process one or more orders in their web interfaces, you are potentially giving away the largest asset of the business to a process that you do not fully control or own and in the case of Amazon, you cannot get that data back out easily either.

An Example of Bad Data – Amazon

Let’s take Amazon as an example. It’s not unheard of for a business to have spent hundreds of hours loading thousand upon thousand of inventory records onto Amazon manually. And of course, this most likely had some huge positive effect to the business, namely orders & profit.

However what has been happening is that the business has been building Amazon a superb product database, that the business no longer has ready access to. You’re unable (either easily and certainly not officially) to export the product data that was originally created. While at the same time, Amazon are using that data to market not only your businesses data more effectively to more customers, but to other businesses too.

If you are manually creating products on Amazon using the web interface, stop immediately.

(More on this later in this article)

An Example of Bad Data – eBay

eBay UK LogoThe data requirements of eBay are huge. Lets taking the clothing categories for example. In recent updates the pressure to include attribute data as part of the listing process has become mandatory (along with many other categories too).

This compared to Amazon has positive effects, eBay are then able to leverage this data and then allow customers to drill down on their searches and ultimately makes a better buying experience and ultimately more sales for the business.

However, those attributes are now locked into eBay’s platform and getting them out again is painful and will cause a massive mop-up job of cleaning the junk out to make it “portable” later.

If you are manually creating products on eBay using the web interface, stop immediately.

(More on this later in this article)

Ironically in both examples it’s your data. Once it’s been entered into the said platforms, getting it out again in a format that is reusable is in some cases just not possible.

I’ve only ever worked with one company that elected to completely ditch all their product data to start again afresh. What they did make of it a second time around with a structured approach was truly amazing, but out of the hundreds of businesses I’ve worked with, this was the exception, rather than the rule.

What is more common is for businesses to try and do is to extract their product data and bring it into a 3rd party tool. In doing so (as I mentioned above) causes an absolute mess to try and sort out. The descriptions that come back from eBay are the full descriptions, so the data held within them is difficult to impossible to extract. Item specifics can be lost completely and any attribute data that formed variations can also be lost too.

In a recent conversation, it was mentioned that a business had tried using an import tool from a 3rd party software provider and the mess that was left over, not only went wrong multiple times, but was in such a state they were forced into abandoning it completely.

This is exactly the situation that you should avoid.

Step in the Saviours

It does not matter what software tool you use and this could of course be a combination of tools. The critical factor is that you have access to both the inventory data and sales data externally, outside of the marketplaces themselves.

To spell it out very clearly:

The moment you suspect the business is going to work long term, employ 3rd party software that is not created by the marketplaces as soon as possible or if it is, you can easily gain access to the original data.

Frankly I do not care what software it is and neither should you (to a point, that point normally being cost), as long as it allows you to enter the product data outside of the marketplaces and retain this data.

As far as sales orders go, having the ability to process them externally is normally a huge positive to the business, however in the case of Amazon, you are able export the sales data for current or later use, where as eBay, no real export and sales data can be lost after 45 days or so.

There are providers that can cost several thousand pounds over a year are not suited towards smaller businesses, however there are plenty of options out there and again the core criteria outside of cost, is:

  • Access to the raw product data
  • Access to sales data

Other requirements such as stock control, order management in the case of this article are either assumed or luxuries.

Free Examples

We all like free and here are two free options for both eBay & Amazon.

Amazon
If we take the Amazon marketplace as an example here, if you stop entering data manually and start using the import sheets they provide for the inventory data, because you’re storing this on one of the computers you have access to, after sending it to Amazon to create the product, keep the sheets, because you can use it at a later date, either to update the records that were in the file or to transfer the data to another marketplace/sales channel.

eBay
If you’re looking for a free option for eBay, then for product data eBay’s File Exchange this covers both product creation, updates and also order data too. However can be clunky and in massive accounts, can take several hours to process requests (I tried this on an account with over 10,000 live listings, it took 5 hours even for a basic export, on a smaller scale it would be adequate though).

Other Providers
There are a multitude of providers that can offer superior options outside of this, they are not all SaaS models (where you pay them a commission on sales) and if your requirements are low, then community extensions to popular website open-source products can be free or very inexpensive (covering these is not a concern for this article, just that they exist).

Ultimate Goal For Your Data

However the ultimate goal in regards to your sales and inventory data is that you have access to them and you can then re-use the data. I call this “portable data”, data that you can use as you need to, where ever that may be.

Sticking with the example approach of this article:

Lets say you start a business on eBay or Amazon, you see the signs that its going to go well and do put some form of software in place to maintain control and ownership of your data, you can then grow and grow as the business dictates. You can move software providers relatively easily and if you want to add in new sales channels, such as a website or another marketplace, with a few tweaks to the data you already have access to, you can do. The other option of not doing this, is frankly nasty.

Summary

Data either product or sales related is the life blood of an eCommerce business.

It needs to be “clean“, it needs to be “yours” and it needs to be “portable“.

If you keep bashing data into marketplaces and don’t retain a copy, then you’re basically capping the potential of you and your business. And that’s something neither of us desire.

What Does Online Gaming Have To Do With Marketplaces like eBay & Amazon?

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In this article I pose the following question with an aim to draw a comparison between features found in gaming, to that found on marketplaces like eBay & Amazon.

What Does Online Gaming Have To Do With Marketplaces like eBay & Amazon?

Before I can attempt to draw a comparison, I need to identify some of the core components of online gaming. Being a self-confessed hardcore gamer, I feel I’m at least semi-qualified to attempt to document some of the qualities that online games have to offer, as for the marketplaces comparison I also feel I’m semi-qualified there too.

 

Understanding Online Gaming

Team Fortress 2

Team Fortress 2

My history of gaming goes back to the original days of WON, which was the system that Valve used for multi-player games using the Halflife 1 (HL1) engine before it was migrated to Steam. This now includes games such as CounterStrike & TeamFortress Classic & the variations that spun from these, like FortressForever.

My online gaming has taken a specific slant, multi-player. I’ve never really been a fan of single player games, HalfLife 1 & 2 are prime examples, I’ve not played more than a few minutes with these two, but I must be into the realms of years now of the hours put in for the multi-player versions. Also it’s worth pointing out that I took several days off on the release of TeamFortress 2, so that I could sit down and enjoy the newly released game.

To give an indication of the extent of my lust for multi-player, I’ve dabbled with MMOG’s (Massive Multiplayer Online Games), however because I know my personal weakness for them, I’ve steered away from the likes of Guild wars & World of Warcraft, because I know I’ll have no life after them. I’ve recently been hooked on World of Tanks (WoT) and my gaming community lost me for over 8 months to a web based MMOG called Tribal Wars.

It’s also a good time to indicate that I am not a fan of football, this may explain in part my obsession with online gaming, as I miss the key elements I detail later in this article from bot being a “fan” that can readily port to the game of football as well, not just selling marketplaces like eBay & Amazon.

Tribal Wars is an interesting game to consider, as its not the normal type of game that you would consider as online gaming, as its all based in the browser & is highly focused towards strategy. Starting with a single village, you go plundering other villages to get more resources, the aim is to increase your buildings & troops to a level, where you can educate a nobleman, then go off and over 4-5 attempts, win over another village. This is all done in a web browser, while fending attacks from other villages, attacking other players,  joining tribes and plotting the demise of other tribes in the world that you’re playing.

Tribal Wars ignoring the core requirements that make an experience (XP) MMOG based game, also sunk into another passion of mine, coding & mathematics. Now this is where I seal my fate for that game as I’m now willing to admit that I wrote a masterpiece of over 52,000 lines of code to automate that game and this was the reason why I ended up dominating an entire continent (or K as they’re known). Naughty I know…

Flipping back to some current games, these being TeamFortress 2, CounterStrike Source and World of Tanks. While these games being in a different format (employing role play, first-person shooter, real-time strategy etc…) where you play an humanoid or tank object, rather than being focused on an image in a browser, the cross-comparisons are exceptionally similar.

Core Elements of an Online Game (for me)

Each of these games employ the following features:

  1. Ease of play, even for new players (called n00bs)
  2. Social interaction
  3. A scoring mechanism
  4. Team play, with real people (see note on AI later)
  5. An experience mechanism & Achievements
  6. A token mechanism (this is another form of Economics)
  7. A single or set of characters that you can improve over time
  8. Ability to be totally random
  9. Respawn events or never-ending

It’s critically important that new players are able to join and understand the game quickly, then to build a lust for gaining experience & achieve some or all of the other core attributes. Some games do this by having tiered levels of games, taking WoT (World of Tanks) for example, there are 10 tiers and players only play with other players in tiers up toa  maximum of 4 above them, to keep the game enjoyable for them.

Social interaction is huge for online games, it’s been known for people to get married in games! A really nice story to add here is that out of the gaming community I created a few years back, we now have our first real life baby that would not have entered this world without it. Now that’s the power of social interaction, forget the rest of the normal stuff, chatting, plotting, team work etc… Social can go to real world too and we’ve had some amazing nights out with the lads when we’ve all met up from all around Europe to a single place and take the virtual to the real-world (Big Chief looked pregnant, but he was a bloke).

Team play and the interaction of other real players is absolutely key, they’re needed to keep the game random and also to allow team work. Now this teamwork may be in dual units or as entire tribes of hundreds of people, but its this co-operation that can truly make a simple game, hugely addictive.

Now this is a good time to cover artificial intelligence (AI) and I’ll be back to the core elements shortly.

Artificial Intelligence In Games

You may also be wondering why I have spent a couple of hundred words with this topic, when you get to the marketplaces comparison later, AI has its direct comparison to “automation” and it’s critical you understand AI and how it’s linked to together.

Now this is where I’m going to slate one of my favourite game providers, Valve. Although to be fair they had a brilliant stab at it & I just prefer playing with real people.

Left 4 Dead Characters In two recent releases, Left for Dead and Left for Dead 2, this game is based upon a AI engine that works out the skills of the players and adapts the game to suit. The problem is, the more you play, it doesn’t take much to work out the trigger events and when you’re likely to find a witch (she’s lost a child& sits there crying and goes ape if you have your flash light on, then proceeds to attempt to kill either you or one of your 3 team mates) or a rank (a whopping great big zombie that can rip the floor up & lob it at you, you gotta burn that one with a petrol bomb and it takes some kill I can assure you).

The original incarnation was just a team of 4 players, this was an immediate fail for me, as I need at least 10 people each side to consider it worth my while, any less, the game dynamics start to suck. In later updates a “verses” game appeared, so instead of just 4 players, 8 could play and the first team, the survivors take on the opposite team, who play one of 5 roles as zombie-fied creatures. With random hoardes of zombies appearing, or not so random as you figure out as you play more and more. Yes, there was an hack to allow more players, but the amount of server load caused by the AI engine, made it unplayable.

So, for me AI sucks. I’d rather play with humans, you can never tell what they’ll do next and no game is exactly like the one before, ever.

Economics & the Other Factors

Economics are a curious addition to online gaming, not only can this provide an amazing gaming experience, but it can also allow game creators to find extra sources of revenue or even make it their sole revenue stream.

World of Tanks - American TreeTo focus on the gamers side of this equation, lets take WoT’s, in this game you start with a level 1 tank and you gain experience (XP) with each battle you fight, you get more if your team wins and less if your team fails. You also gain credits for each battle and they follow the same path as the XP, if you win, you get more coins. Its the combination of the XP to unlock higher tier tanks and you need coins (lots of) to buy the tanks. So the more you play, the more XP & coins you get.

Now while this game does not have sharing abilities that I’ll cover in a moment, this game does have the ability to buy gold coins that can be used for several purposes, such as having a premium account that allows you gain 50% more XP & coins each battle, or they can be traded to buy special tanks or ironically even to convert XP or buy normal coins.

world-of-tanks-gold-1As you can tell this can could get expensive, I did a few quick sums and with a small group of us, we’ve easily ploughed £1500-2000 in this game alone in the past few months.

Now flipping this to the game makers, this is where freemium kicks in and the best example is the TeamFortress 2 game I referenced earlier. In this game you play one of 8/9 characters in teams of up to 16 per side and battle it out in one several game formats capture the flag/point, attack defend or death match.

Bots (AI/fake players) were added, these were a feature in the original game Team Fortress Classic (by their modding community, as the game has an API), however again they’re actions are relatively poor compared to humans (although the way-pointing has come on quite a way since the original), however as per my earlier note on AI, these generally suck and the general community of players tend to keep away from BOT servers.

This is where it becomes interesting because this game originally started as a typical game, buy it and play as much as you like, however Valve at the time had started to implement a drop mechanism for extras in the games, such as weapons or items you can wear. These items could be stored and new items could be built, but in a stroke of genius, they allowed the items to be traded and then that’s where the whole game changed. TF2 turned into a free game and the revenue stream is now made from the massive user base sporting customised items, that new players want and can buy from the in game store.

Modding Engine (API)

In the case of Valve games, they have for a number of years now allowed 3rd parties to leverage the gaming engine, either to create new games or to change the way the current games are played.

This has been done via a link to the game engine on the server and communities like SourceMod that sports over 450 plugins that can completely change the way the games work and have allowed longevity to the gaming engine, because of the hundreds, if not thousands of addon’s & extensions that have been created by 3rd parties to the original games.

Achievements

In all the games I’ve covered above, they all sport the feature of experience & ability to improve from what they originally started from, this can be with time input or via paid for addons. Another important factor I have not covered up until now is the ability to “respawn”, this is where the player at the end of a round or game, starts again at the beginning, to play another challenge against the players.

In TF2, its normally a round based game, this could be to capture a flag or point(s), counter strike source is similar where a bomb needs to be planted or hostages need to be saved (or inversely,  a bomb site or the hostages need to be defended) and for WoT all the enemy tanks are destroyed or the cap point is taken.

In almost all the games I’ve mentioned there is the ability to be awarded achievements from the actions taken in the games. For WoT this may be sniper or a medal, for TF2, this could be the number of kills scored with a weapon or other combinations, some are obscenely hard to get, in fact one of the spy achievements due to a bug that was introduced a year ago, cannot be completed.

The most competitive of players will aim to unlock ALL the achievements for one or more player classes, the same as one of the players that I play with on WoT, he’s unlocked every tank & upgrade for an entire country tree.

This has literally taken him months and by his own admission that country tree (USA) & the tanks contained with in it, are crap compared to Germany, to the point that the highest tier tank in that tree is being removed and replaced with another, because its so under powered.

But he knew this & still continued, the game play itself was only one part of the game, unlocking the boxes on the screen was more important to him, than how the tanks actually played and invested months obtaining this level. That I hope demonstrates the power of achievements.

How Does Online Gaming Dynamics Relate to Marketplaces?

I’ve pretty much covered the basics of online gaming in ~1900 words, however how does this relate to marketplaces like eBay & Amazon?

 ebay-feedback-profile-1

Well the most obvious is feedback, when you first start selling on either Amazon or eBay (the game), you start from 0 and work upwards. The feedback system is incremental and ports directly to the experience (XP) model found in games, the more you sell (the game) the more feedback you’re likely to obtain.

Now this is where the game gets interesting, as Feedback is not entirely incremental, it can decrement too. So if you have a dissatisfied customer, they can leave you a neutral or negative feedback, this can be directly compared to the World of Tanks game, because even though you lost a battle, you still got something from it, albeit a negative and because you want more XP & coins (think feedback score & profit) then you do your best [as a business] to ensure that the feedback is positive.

Marketplace Achievements

When we mix in other dynamics of the marketplaces, lets take the eBay PowerSeller status, that has multiple tiers, Bronze, Silver/Gold, Platinum & Titanium and now the ultimate of being a “eBay Top Rated Seller” (eTRS). So that when you reach this level, you are allowed to leverage discounts on your eBay fees and gain extra exposure. This is very similar to the premium model found in MMOG’s and has distinct correlations to the items found in TF2, an item is worn, the same as the eTRS badge is worn.

Now chuck in the eBay “Detailed Seller Ratings” (DSR’s) where sellers (the gamer) can be scored on more than just feedback that had just three levels, buyers can rate sellers on a scale of 1 to 5 for their experience, this absolutely wreaks gaming levels, especially when you consider the business (or gamer) can electively choose to lower its risk to specific DSR ratings by tacking tactical/strategic decisions on the way they list (play the game) on eBay.

Flipping over to Amazon, Amazon is a slightly different game (or business), Amazon is a longer term game where you don’t gain access to the converted buy box for at least 3 months and in most cases is 4-5 months, after proving that you are a worthy gamer, I mean business, as you can see the line is now becoming blurred between business & gamer.

Amazon also leverage the feedback game, with ratings from 1 to 5 and with eBay too, you can play the feedback game by leaving follow up comments or attesting feedback that has been left by buyers. In a gaming scernio this is similar to appealing to the server admin or game providers for a cheat or foul play (think those scummy buyers that try it on) or appealing directly to your eBay or Amazon account manager.

The reviews & guides that is found on eBay is also an interesting gaming feature. As a business you’re able to write reviews for other gamers, sorry I mean eBay members to rate on how well the review is written / its usefulness. You can also sport an extra logo next to your eBay ID (player name) if the sum of your reviews meet specific requirement levels (think XP).

Administration

You can also make complaints about cheaters to the powers that be, this maybe someone stealing your images or breaking one of the marketplace policies or this could be a player with suspect game play.

This can also take an automated approach by either the markeplaces or the game providers, for example listing items that are under the VeRO protection on eBay or by a cheat being picked up by the anti-cheat VAC system that is used by Valve.

What Does AI & Marketplace Automation Have In Common?

I spent a good few hundred words explaining the AI (Artificial Intelligence)  system found in games and I did air a dislike for AI in gaming, this can be directly compared to automation of business processes for the marketplaces. Somewhat ironic that I’ve spent years working on tools to automate marketplaces, however just like AI it has its place, the same goes for automation.

In a recent article I released titled “The Top 8 Pitfalls of Using 3rd Party Software To Manage Your Business” I cover the common issues found when using such tools as eSellerPro, ChannelAdvisor, Linnworks, ChannelGrabber and so on, these are all caused by being removed from the games or businesses processes at ground level. The ultimate failure here is when the 3rd party provider goes down, this is the same as the AI engine failing and no-one can play the game, the business almost stops without it.

Don’t get me wrong, AI has its place, the same as automation tools, but if you rely too heavily on them and don’t report on them effectively, then the game or business is pretty much over.

API Access & Longevity

Another striking comparison between HalfLife engine games & the online marketplaces is the API access abilities. Having access to the core engine of the game/marketplace allows 3rd parties to expand on it further.

This could be as simple as feedback automation or it could go exceptionally deep as examples such as eSellerPro & ChannelAdvisor demonstrate exceptionally well.

The eBay API has to be one of the most comprehensive API’s out there and comes in numerous forms. Amazon Web Services rely heavily on API’s also and this has spawned numerous connected businesses, you only need to look at the eBay solutions directory to see the full scale of what can be achieved and its no wonder eBay Inc went for a new platform called X.Commerce, they know full well, without the integrations that millions of 3rd parties can provide will extend their core marketplace & associated companies offerings.

In all cases, because of API access, this has allowed 3rd parties to take extensions to the original platforms into areas that were not even conceived by the original creators, increasing customisation & longevity of the platforms.

Summary

All marketplaces whether knowingly or unwittingly employ several key features found in on-line gaming to keep businesses & users entertained with the marketplaces.

eBay probably have most of the bases covered, all though the XP model could be leveraged more, the feedback stars are nice, but multi tiered achievements could also prove lethal for competitiveness. A wild idea would be to have achievements for selling X value in one day, week or year, dominating sales for a category, badges based upon time, the options are endless.

Amazon have a few areas covered, but could leverage so much more from the core elements of online gaming to their advantage. In both cases, the marketplaces can be quick to leverage and as more experience is gamed (or did I mean gained?) and more automation is put into place, more coins, achievements or profit can be leveraged from them.

Yes, eBay & Amazon are different marketplaces or games, however the most starkest comparison that can ever be made between gaming & marketplaces is this:

Whether its a game or a business, if you take away focus, that is either working on despatching your orders (amongst other key business tasks) or playing the game, the game is going to cease to be played.

Did you enjoy this article? Did I miss out an element or a factor that you feel is important or have you spotted something I’ve completely over looked? Post your comments in the box below

5 Tips for Preparing Your Business for January Not Christmas

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It’s now late November and we’ve seen a good couple of press releases from supporting companies on how to increase and keep your Christmas period sane. However, it’s all too late as preparations for Christmas really should have been in place at or before August.

If you’ve not trained seasonal staff, arranged stock transfers, deliveries, put automation software in place, heck everything that gets amplified due to typical higher sales volume, then the next 3 weeks are going to be “fun time” for the business.

 

I Forgot January Once & Only Once!

However… below I’m sharing a short story on why you should not forget January and learn from a mistake I made a couple of years back.

After having a pretty hectic Christmas period, I had decided that on the 1st of January I was going to have a week or two off. Oh boy did we need it. We had been flat out for the past few months preparing for Christmas sales and had thought we had done everything right, sales were good and were very much looking forwards to the break and we thoroughly enjoyed it.

On our return, we started talking to our suppliers and that’s where it hit home, it turned out that our two main competitors had been busy & done their homework. They had an amazing 3 weeks after Christmas. They had been negotiating special deals and jumping on the clearance lines that were abundant. They’re January had rocked to the point that they had cleared more stock in those 3 weeks after Christmas, than in the entire month of December.

I cannot tell you how sick I felt, I had missed one of the oldest tricks in the book.

No Slacking in January!

January has the potential to bigger for sales volumes that December, the reason is simple people are in “sales mode”. What happens just after Christmas or even just before, 99.9% of all high-street retailers go into sales mode. People queue & even camp out on shop doorsteps to grab bargains and ironically this is really straight forwards for you to hijack.

So instead of making the mistake I made, here are five tips for preparing for the first few weeks of January or before:

Tip #1 – Delay Moving Software Providers

Shelve any idea that moving software providers, that can wait until the middle or later in January, if they got you through Christmas, then a few weeks delay won’t make much difference. If it’s not completely broken, don’t fix it (yet).

Tip #2 – Speak to Your Suppliers in Advance

Ask them explicitly what is going on sale after Christmas, suggest that you’ll be able to take larger volumes or stock that didn’t do well at a discounted rate. Spell it out on them, you have extra buying power after Christmas and you can help your sales rep hit his bonus for January.

Tip #3 – Prepare Several Lines to go into “Sale Mode” Now

By using tip #2, you will have an idea on what product you may have at better rates for a sale, as such prepare any data around these in advance, it’ll only take a few minutes per SKU as you can easily create duplicates or variations of the SKU in advance, with new details and perhaps use a different listing template to go with them.

Also a slightly different method would be to consider products that you would feel comfortable sitting on for 9 months, that you know will do next year and scoop extra discounts now and take a punt on higher returns next year?

Tip #4 – Do the Artwork Now

Designers are typically not very busy at this time of the year and it could be a good time to grab a saving on a mild branding redesign for a sale period. Such as adding sale logo’s to an existing template and preparing the design aspect in advance, so that its a click & go event, rather than a rush job when it’s too late.

You might also want to look at the two articles I wrote earlier this year on How to Make Your Own eBay Daily Deals & Weekly Deals and another on How To: Using eBay Shop Keywords to Leverage the Extra eBay Shop Pages, as you can prepare these in advance and hide the pages in the shop, then when it comes to sales time, swap them over in your eBay shop.

Tip #5 – Email Marketing

The same as the visual aspect, if you’ve worked and have obtained a couple of product ranges that will be worthy of a sale, then combine in the updated artwork to your email marketing campaigns and prepare the notifications in advance, so when the time comes, it’s a quick check over and off you go.

As an idea, if you have multiple products, you could make an event of it, explain which products you have going on sale and when (a delayed sale) and notify customers on say a daily or bi-daily basis of the latest sale item (you’ll need to be careful with this not to spam, just make your offering exceptionally compelling).

Summary

Don’t make the mistake I made, prepare for January, what products can you clear, what products can you buy to clear and how can you leverage the “sales mode” that most buyers go into at or before January?

If you do this now, before competitors have started having the conversations, then you can be first in and negotiate the best deals in advance, prepare a campaign and take January easy, knowing that you’ve worked extra hard now and actually have a plan for the month, rather than just “seeing what happens”.