Summer has come and gone, and I have not shared an update from Jungle Stix for a little while. While I haven’t had the pleasure of a s’mores-filled campfire this summer, it seems like many Americans are devouring s’mores. Let’s dig in to it and see what’s working, what’s not, and what’s next. Let’s pull back the curtain and take a look at the numbers….
In short: Jungle Stix are smoking hot 😉 ! The sticks are burning off the shelves, and it’s becoming a challenge just to keep them in stock. It seems like making campfire s’mores is even more popular than I ever imagined!
Before we get into the numbers, a few high-level updates:
- Our Best Seller Rank is in the Top #500—currently #417. Yeehaw!
- We now have a “Best Seller” badge, because we are the #1 ranked product in Grill Rotisserie Accessories. Nice win.
Next, I just noticed a new badge that I have never seen before but would like to obtain, being an “Amazon’s Choice” product:
- We have seen more competition and alternatives enter the market, which has forced us to drop price more than is ideal.
And now for the fun part. How much have Jungle Stix sold so far?
- Total sales for the past 30 days are $25,116
- Total sales for all of Jungle Stix thus are is $127,044.
- We have averaged about 30-40 units sold per day, and almost $6 profit per unit sold.
Here is the sales update screenshots from Seller Central:
And our sales from the very beginning, December 1st 2015 through today:
Aside from a few unfortunate out-of-stock situations (the dips in May, June, and August), we have seen steadily increasing sales, and I think we are approaching the peak of demand very soon:
**The Asterisk In The $127k Sales Figures
Those sales numbers are quite impressive, right?! However, what looks like $127k in sales deserves a deeper look. This figure does not include the promotional giveaways that we have run intermittently since launching Jungle Stix. Amazon charges them as a full sale, and then deducts the rebate price on the back end.
If you look at an individual statement, you can see the line item “Promo Rebates” which deducts the promotional giveaways from the top line sales figure. In the example below, it is $304.93. This is our full statement for the end of August that you can pull from Seller Central:
And if you look in aggregate in Seller Central, Reports -> Payments ->All Statements, you can see how much is really generated in sales.
Since launching in December, we have had $4008 in Promo Rebates. So our total sales are in the order of $126k. Still OK, not too shabby!
But how about profit margin?
Using the same “Payments Report” from above, we have been selling at a clip of 39% net profit margin.
The columns from the Payment statement above add up as follows:
- Product Sales: $127,044
- Promo Rebates: ($4008)
- Amazon Total Fees (including PPC): ($70,937)
- Other Total Fees: ($1505)
- Deposit Totals (ie money that has been paid out by Amazon after all fees deducted): $49,206
- Net Profit Margin (Product Sales / Deposit Totals) = 38.7%
This does not account for Cost of Goods Sold, shipping fees, taxes, or other General and Administrative fees.
It looks like we’ve spent about $22,000 on the COGS, shipping, taxes, etc. That would leave us with roughly $27,000 profit and about 120% ROI. Not bad for 1 product that we spend about 5 hours/month managing. We’re on track to do about $35k profit in our first year and I’m sure year 2 will be much better than year 1 🙂
Need help figuring out your product’s profitability? You can use the Profit Calculator here:
Our Conversion Rate Has Increased Dramatically:
As you can see from this screenshot in Seller Central, we are converting at almost 28%. So more than one in four people who lands on our page will become a paying customer. That is very solid!
So we know that people have a great likelihood of purchasing if they land on our product page, but what are the odds that they get to our page?
For that, we will look at the Click Through Rate, which is simply the percentage of people who click on our listing divided by the number of people who have seen the listing.
And ours is pretty solid—58% for all organic traffic, as you can see in this screen shot:
If you remember, we ran some split tests before to see what images generated the best click through rate, so until we get more product photos, we can be certain that we are offering the best product listing to generate clicks.
But it’s interesting to look at why our conversion rate has increased so dramatically in the past few months.
I think that there are several factors to this:
- Amazon shoppers are looking to purchase, quickly: That is why it is so important to have every aspect of a quality listing well-executed, from Product photography, Amazon SEO, a lot of solid product reviews, competitive pricing, and strong copy that appeals to the customer’s needs. If you can nail these, then the customer can purchase the product and move on in their day.
- Peak Season for marshmallow sticks: Private label products are often one-touch sales, so you have to make a strong first-impression and convert immediately. It is hard to build brand loyalty for a product that people won’t purchase frequently, like marshmallow sticks. Many of our customers are presumably planning a campfire, want sticks, and buy quickly after scanning through some options.
- Jungle Stix have great organic ranking: getting your product to rank highly for your main keywords is incredibly important. We covered Amazon SEO recently, which should help you get a foundation for how Amazon’s algorithm works. As noted above, many customers do not have any brand loyalty when they are purchasing their marshmallow sticks, but instead just want to make a quick purchase within their price range. They enter in their long tail search term, probably something like “marshmallow roasting sticks”, and because Jungle Stix pop up at the top of the page, maybe have some paid ads to reinforce legitimacy, and we have a great listing with social proof, it becomes a quick purchase.
Amazon imposes Inventory Storage Limits for FBA Sellers. This applies to new sellers and new SKU’s, and can increase as you prove that you can move product consistently.
Jungle Stix are considered Oversize (Small) due to the 36” length, so initially we were only allowed a maximum of 500 units at a time. We can now have up to 1000 at any time, which is great. However, at the current rate of sales of about 1100 units sold over the past 30 days (about 37 sales per day), we will go through the 1000 units in less than a month!
As it currently takes four weeks for new product to arrive at Amazon warehouses via ocean freight, I am spending more time than I want to ordering and managing inventory shipments. I know how to anticipate and plan for inventory needs (if you haven’t checked out the Inventory Management webinar we did with Jeremy of Forecastly, there are some fantastic resources and tips there),
Opportunities to Grow:
The beauty of Amazon is that once a market becomes saturated with competition, you can shift your business to other Amazon marketplaces abroad.
There is plenty of opportunity in European marketplaces and Asia as well. And I am super pumped that Jungle Scout is rolling out to support each of these marketplaces (the Extension currently supports US, UK, and Germany). We are very meticulous about data analysis and fine-tuning the sales estimate algorithm, but your patience will pay off in spades when we are live in your market. You won’t have to triangulate your product research between Best Seller Rank, Reviews, etc like the old days. Jungle Scout can guide your research to save time and get better data-driven insights.
And taking a quick look at the competition for “marshmallow sticks” on Amazon.co.uk, it looks like there is some room for Jungle Stix:
Amazon makes it very simple to link your Amazon seller accounts between different marketplaces. Once linked, you can access these new Amazon customers, so you can more easily create listings and oversee your business across regions.
It is a bit of a challenge however, to create the legal entities necessary to do so, I am exploring that opportunity now. Once I get that ironed out, I would love to share the beauty of a perfect s’more with our friends across the pond!
There is some opportunity to trim costs and improve conversion rates with our current PPC campaigns. I spend some time optimizing at a high level, but have not yet gone deep into the weeds where the small growth adds up to big wins.
Here is a look at how the PPC campaigns are performing (over their entire lifetime):
Overall, the Average Cost of Sale is 17% (anything under about 30% ACoS is still profitable for us), and the campaigns have delivered more than a 500% Return on Ad Spend (ROAS).
I have had a lot of people ask me about Amazon PPC, both beginner and advanced questions, so I will delve into it in a separate post, and possibly a webinar. Interested? Let me know in the comments section below what questions/challenges you are facing.
Start Getting Google Organic Traffic
This is what the monthly searches for “marshmallow sticks” looks like in the Google Keyword Planner:
As you can see, thousands of people search on Google for “marshmallow sticks” and related keywords every month. And it will stay like this through December. But what do people who search for “marshmallow sticks” see when they search on Google?
The top three results are Amazon products.
Unfortunately we are not one of those three results. However, I am trying to figure out how to make that happen. One thing that may help is having a very simple website set up. If we spent some time trying to drive traffic to the site, and therefore Amazon, we could potentially rank better on Amazon and Google.
I’m not entirely sure about the interplay between Google and Amazon, but I think that driving some outside traffic to Jungle Stix would be a nice lift. Especially if we can continue that 28% conversion rate!
I believe that we should see heavy demand through most of the 4Q. That would be fantastic! I am working on timing the shipments and orders properly, while also trying to improve my Click Through Rate and Conversion rate with some split tests.
So these next few months will be important for us to capitalize on the increased demand and try to generate more sales with this continued demand. Moreover, we will see if we can tighten up our conversions with Pay Per Click campaigns, and also eventually get some increased sales (and diversification) if we can expand into new Amazon marketplaces abroad.
How are you preparing for the 4Q rush? Let me know in the comments section below what your challenges or questions are and let’s see if we can collaborate to make this a winning quarter for all Amazon sellers in the Jungle Scout community!
What are you thinking of doing re Amazons dislike of giveaways for reviews now, for a new product launch?
Hey Greg, awesome case study. One quick question for you, in one of your video (https://youtu.be/XKi6SYPM3tk?t=38m40s) you explain that you add your amazon customer into an actual drip email campaigns where you send then emails on specific schedule after the purchase. This is a great idea. However, based on the Amazon FBA terms, it is prohibited to contact customers after the sell to push any content etc..
Based on this thread: https://sellercentral.amazon.com/forums/thread.jspa…
“You are NOT allowed to put your Amazon customers on a mailing list! That will get your account suspended. Amazon allows you to communicate with customers only when necessary to fulfill their order. Do not advertise or contact customers for any other reason.
Based on this information, can you explain how you can email your customers after the sale without getting into trouble?
GREG JUST A FEW SIMPLE WORDS ABOUT YOU BECAUSE I BEEN FOLLOWING YOU ON THE INTERNET AND TRACKING YOUR RESULTS WITH JUNGLE STIXS ON AMAZON WITH AN OTHER SOFTWARE ON A DAILY BASE I WOULD TO TELL EVERYONE READING THIS BLOG THAT YOU ARE A GENIUS AND EVERYTHING YOU HAVE SAID IS TRUE TO YOUR WORD AND IF ANYBODY WANTS TO LEARN HOW TO SELL ON AMAZON THEY SHOULD GET IN TOUCH WITH YOU YOU KNOW HOW TO MAKE MONEY….GOD BLESS
Always love reading your updates.
If you use Moz toolbar, you’ll see that the #1 result in Google for “marshmallow sticks” has 8 backlinks pointing to it and they have a tighter keyword phrase closer to the left of the title. Those two things are huge factors in putting them at number 1 spot.
You could get 9 or 10 backlinks to your Amazon link and that should help, but also try to move marshmallow sticks closer to the beginning of your title or closer to the beginning of your product description to see if that helps with Google rankings. (I know that’s a delicate balance between ranking for Amazon and ranking for Google.)
Great point and helpful about prioritizing keywords, thanks for sharing that!
what website builder did you use? Looks really good. I would be interested in knowing about PPC campaign to lower acos
Love the new Jungle Stix website! It’s very eye catching. What site builder did you use? I’m about to tackle that next step so I can participate in brand registry.
Keep up the hard work! Jungle Scout has been incredibly helpful to me and I wanted to thank you for all you do.
Hey Lisa! We used wordpress and a free theme to build it. Pretty simple to do with some very basic wordpress training.
Did you use a superurl?
No, in my opinion super URL’s stopped working a couple years ago. They’re also against Amazon’s TOS. No need to use them, they don’t do anything 🙂
As I was reading through your post, I thought, WOW! Gold after Gold! I can’t believe you’re documenting in detail every part of this journey to help everyone, great job guys! Your post basically answers most of my questions I had lingering on my mind all this time.
Anyway, I had some success selling on Amazon for the past yr and I’m looking to expand to other markets (de, uk, jp, ca).
But I wanted to ask you this:
The sales estimates on UK and DE are very minimal. I’m talking about $500 (UK) vs. $10,000 (US), for example. Is this a supposed to be a good sign of low competition or lack of demand? I know the sales number alone is not a good indicator of whether or not you should enter a market, but haven’t you seen the same thing I’m seeing?
Expanding to a new market is easy in terms of linking the Amazon accounts, but it also requires separate shipments from your supplier to that new country, which means: new investment.
Please let me know what you think about this, I’m curious to hear what you think 🙂
Love what you’re doing, keep it up guys!
I have noticed the same thing, that sales estimates are noticeably less in other marketplaces. This is not necessarily a surprise though, as the Amazon US store is significantly larger. Though I am not as familiar with overseas marketplaces, opportunities are there and it seems to be a less competitive marketplace.
Perhaps because you already have a product and a supplier, you can test different marketplaces with your product with small inventory shipments? Maybe offset some shipping investments with a renegotiated price with your supplier if you are buying in greater quantity?
Good luck with that, please keep us posted on how it goes!
A few questions:
1. How many units do you give away per month? Do you have a specific strategy in regard to number of giveaways and frequency?
2. Having to drop price to combat competition was briefly mentioned in the article. What pricing strategy are you using exactly? For example are you matching prices, lowering when they lower, raising when they raise, staying a dollar higher, etc How does the competition’s pricing actions affect your decision making?
Thanks for all you guys do!
1. We have been giving away 10-30 products per month on Review Kick, depending on the need. For example, we had a few Out of Stock situations this summer, where the BSR plummeted. You can read about it here: https://www.junglescout.com/blog/consequences-of-poor-amazon-inventory-management/
And with fourth quarter quickly approaching and continued high demand, we have continued some giveaways to maintain an extra-strong sales velocity and increase our product reviews.
2. Good question re: pricing. We split test between a couple different price points with Splitly, to find a price with maximum profits. It turned out to be the current price of $21.88, but we should be doing another test soon as the market conditions have changed since. We started selling at $27, but when others entered the market selling at ~$20, it definitely undermined our conversion rate so we had no choice but to compete at that price point.
Thanks for reading and sharing your thoughts!
For PPC, the go-to resource and tool for me is PPCScope by Brian Johnson. Listen also to the various podcasts on the topic by Scott Voelker a couple of times and it soon becomes pretty obvious how to search-and-destroy your PPC campaigns…
Pro Tip: The break-even point for a PPC campaign is when your ACoS = Your All-said-and-done* Profit Margin for the advertised product(s). Above that, you’re losing money (although you will be assisting your BSR and so enhancing your more-profitable organic sales); below that, you are leaving potential sales “on the table”…
* You really should include your COGS, other variable costs, and apportioned Fixed Costs to your Amazon profit calculation to determine this. My go-to resource and tool for this is my own Excel spreadsheet calculation 🙂 but CashCowPro does a fantastic job of this too.
Great work, Greg, on the Junglestix product!
Yes, Brian is a wealth of Amazon PPC knowledge! We had him on a webinar a few months ago, he shared some great insights: https://www.youtube.com/watch?v=3SU_-5xVVdA
We did include advertising costs when we went more in-depth with the financial calculations, maybe some elements of this spreadsheet can help you with your Excel spreadsheet… https://www.junglescout.com/blog/profit-margin-calculator-spreadsheet/
Hey Greg and Gen!
Thanks for the update!
I vote for a webinar delving into the finer points of Amazon PPC.
Thanks for the great content.
Marc, your vote has been tallied, and we will do it! Stay tuned, notice will go out via email.
Great case study guys – Amazed that tons of copycats didn’t come in on this :/
Looks like your net profit margin is about $4.30 / unit.
$27,000 / 6,268 = $4.30
We’ve had about 10 or so copycats jump on this. The thing is, this niche if fairly crowded now, the time to enter it was at the end of last year when we did 🙂 The thing about Amazon is you want to get in on niche’s when they are young. There are still of thousands of good and new niches to enter, the time for marshmallow sticks has come and gone though!
Hi Gen, how are you guys accessing Google Keyword Planner these days? It seems that they have blocked access to the monthly search volumes. Are you running a campaign on Google to get this access?
Yes, I did see that Google has limited access to Keyword Planner. I pulled those figures from an account that still maintains search estimates.
Great article I love the transparency of Jungle stix’s journey. Yes, I would love more information on PPC as I am waiting for my products to hit amazon it would be great to know things you wish you would have known about PPC just starting out.
Consider it done, we will run a PPC-focused webinar in the next few months. This article may help in the meantime; https://www.junglescout.com/blog/amazon-pay-per-click-optimization/
Do you still keep the PPC daily budget at $50-75 per day?
The spend for the past two weeks has been roughly between $30-$50, averaging about $1 per click:
I am also curious about the sessions / page views calculation above.
If I understand correctly:
sessions = the number of unique customers who visit our listing within 24-hour period
page views = the number of times our listing is visited within 24-hour period
So, if a customer visits our listing 3 times in a day, we get 1 session and 3 page views, etc.
With the above, I don’t feel sessions / page views is equivalent to click-through-rate?
I have been really wanting to figure out how to track click-through-rate on Amazon!! The missing piece seems to be Amazon never reports the data how many times our listing is “presented” to customers (i.e. impressions). Both sessions and page views seem to represent “clicks”.
Hey guys, thank you so much for this case study – this and the Jungle Scout extension has actually helped me find my very first product – which I actually just got ordered today and its headed into Amazons warehouse. I actually was able to find a domestic manufacturer – which I think is a huge plus. Anyway, my biggest challenge thus far is, being my first launch, I don’t have a huge amount of capital and so I’ve had to find a low cost product and really be picky on which services I pay for in getting the listing created and optimized. I’m hoping the money I have will suffice to be able to get the listing launched properly so it can start producing organic sales. Can you lend some time or do a webinar on how to launch a product on a tight budget? Which optimizations and techniques can be done without much or any investment? What are the most important aspects where its best to sink the little money you have? I think that would be a huge benefit to a lot of people just starting out. Thanks!
Congrats on making some big steps forward!
I think most impactful to the successful launch of Jungle Stix was starting strong. We did a giveaway of ~50 units to get initial reviews and sales velocity with Review Kick. This does require the investment of promoting your product with Review Kick and the Cost of Goods for the product (you could give it away at cost), but you will still pay Amazon fees.
Other than that, creating a robust listing with your keywords well optimized and researched, and high quality product photos are essential. You can see the step by step process of how we created the listing here: https://www.junglescout.com/blog/collaborative-private-label-launch-session-5-pre-launch-tactics-scott-voelker/
hope this helps!
Jacob – am also U.S. based and looking at domestic suppliers, although I haven’t had much luck yet. I currently have two PL products on AZ, both China-sourced. Would you care to elaborate on where you looked for U.S. manufacturers? Thanks so much in advance!
Looking great! I would be very interested in some deep diving on PPC. I have just hit 1 month of PPC data and am looking to take the next step to refine my campaigns.
Keep up the good work!
Stay tuned for a PPC webinar! In the meantime, you can read these articles which should be helpful:
And a few more articles here: https://www.junglescout.com/blog/category/amazon-ppc/
Awesome update, thank you. One thing though — I’m not sure if the page views / sessions calculation makes sense…
Good catch, the Amazon terminology is a bit different than standard terminology, however clarified the screenshot to reflect: CTR = Sessions / Page Views, which is equivalent to Clicks/Impressions.
Hope this helps!
so you spend 5 hrs/mo managing it, but how long roughly did it take to set up the product?
or maybe you wrote that in your last post, i can’t remember.
i’m setting something up on the side (sourcing from the US, organic, so my profit margin will likely be less than your 27%) and AMZ is giving me so much hassle! technical difficulties galore….. typical SC BS really. it’s eating away more time than i had expected.
The product research phase took a few hours using the Jungle Scout Web App (specifically the Product Database), and we gathered actual sales data over a few weeks with the Web App’s Product Tracker.
You can see the first session on gathering product ideas here: https://www.junglescout.com/blog/our-collaborative-product-launch-session-1-gathering-product-ideas/
and the whole case study can be found here: https://www.junglescout.com/collaborative-launch/
Hope this helps!
Wow! Excellent performance guys. I love the focus, determination, discipline and clearness you are sharing with us. I’m super challenged to make it happen too (from Italy to US market). I’m in stage 1 (find product) with Jungle scout Pro and web app on about a week, and I feel super confident. Thanks guys, keep going!
Awesome to hear Antimo, hope that this case study helps you, please keep us updated on your successes!