PITCH 2 Zon Tools
Welcome to the first season of Go Pitch Win! Each week Greg is joined by a guest judge to hear 2 entrepreneurs pitch their business or product. After hearing the two pitches they will pick the weekly winner to move on to the final 6. At the end of the 6 weeks, Greg will select the top 3 and then we need you to help us pick the winner! Once the 3 finalists are announced we will open the voting for you #FreedomBuilders to choose our $10,000 winner!
Greg Mercer, Jungle Scout Founder
Greg is the founder and CEO of Jungle Scout, a suite of tools that empowers freedom builders. As a successful entrepreneur, Greg leads a team of 65+ employees. He is also an influential educator, offering free and inspirational content that has helped thousands of people build their own businesses and freedom.
Liz Saunders, Go Pitch Win Project Manager
This week's guest judge Liz Saunders. Liz is a project manager here at Jungle Scout, she's an entrepreneur at heart, has her hand in many different successful businesses, and loves travel and logistics.
PITCH - Zon Tools
Zon Tools is a suite of tools that help Amazon sellers navigate PPC, sponsored ads and campaigns to successfully launch and market their products.
Stefano: Okay. So as for myself, I've been traveling since pretty much 2005, and since 2005 I decided that making money online was the best way to finance my passion, which is basically traveling and sport. The first time I started making a little bit of money online was 2011. I was in Vietnam and we had an online booking system. And fast forward now, I got some experience PPC. Some more, some more, some more, and eventually landed in Amazon in 2014 and its been Amazon since then. Very, very successful. Very happy. It was a life changing experience for me.
Tarik: I have been a developer since I was a kid. Like 1988 when I had my first computer, Commodore 64, and then got clients at that time. But my commercial experienced just started as early as 1995 when I was developing static web pages there for some clients, and then I continued my journey and later become an engineer and scientist for this. And then I continued developing software until I made some Amazon stuff, so I developed some applications for eCommerce and Amazon related applications. And then two years ago we pretty much discussed this project with Stefano and I found it very exciting to have these kinds of things because there was nothing around at that time, and it was pretty unique, and I believed in the software. It was very powerful and I believed that it will change the life of the Amazon sellers, and so we go ahead and started this project together.
Stefano: Zon Tools because it's a fully automated online advertising management system focused on Amazon's posit product ads. Marketing technology history. So since 2011 the amount of marketing technology providers and vendors has been grown exponentially. Last year were about 5,000 providers. That includes Facebook, Cardboard, and all the smaller service providers. And we hope to be one of those and we hope to grow to be the biggest marketing technology provider for Amazon sellers.
Amazon's Sponsored product is the simplest PPC platform. You don't need to come up with any great copy, there is no need for testing image, there is no messing around with the artist positioning or departing or audience targeting. You simply bid on your product listing and assuming that your product listing is well optimized, that's pretty much what you have to do.
If done properly, the odds of winning are greatly on your side and you simply, but it's not so simple, has to have the following 4 things: you need to the knowledge about PPC on Amazon, you need to have a solid strategy, you need to have a solid system that implements your strategy, and you need to have a solid in-streamline way to maintain the system in order to grow and scale it.
Let's talk about a bit of knowledge. Knowledge is customer serve times. You need to know what the customer serve time is. You need to know what the keyword is. You need to know what mets tags are. You need to what campaign types are or what campaigns types are allowed within Amazon ecosystem. You need to know what limit Amazon impose on campaign, keywords, ad groups, and on your overall account. You need to understand what attribution is, so how does Amazon actually view the sale. And you need to understand very, very, very well the report because that's your bread and butter. All your action, all decision must be based on the reporting Amazon provides.
And with system that I designed, first manually and now we can automate through our software, is simple. So we have a product at top of pyramid, below the product we have a group of four campaigns, how to broad phrase exact. And within each campaign we have several ad groups that will let different function. The top level ad groups, will simply take over when the first ad groups is filled with 1000 keywords, you will have to put a second ad group, and third and fourth depending on how much you're gonna grow your campaigns and your keywords.
And then you're gonna need to test that group. So you want to test bids so if the initial bid on a keyword won't get you to a profitable place or to a place where you are happy with your A cost, you might want to pause the keyword and test a lower bid. Might allow you to reach your A cost goal. And so if this first test fail, you might want to test even a lower bid. So all this test ad groups with a lower bid should be included within the same campaign. Why this? Because in order to limit the amount of keyword that we use on the account, you need to centralize the use of negative keywords and in doing so, you need to put all the negatives at the campaign level and everything that is within that container, we know what negative not to show you for.
The point of all this strategy that I explain you is that it is very, very hard to manually set up in such a granular way. It's very hard to track the performance from us a keyword letter because you end up having multiple keyword different matches. It's hard to keep a log of all the changes that you apply on a day to day basis. You or whatever service you use, it's very hard to scale if done manually. You can run such a system one product, maybe two product, but when you have an inventory of 100 products, 100 skews, it gets very, very, very hard.
It's extremely prone to human error. There is only so much time in a day which a PPC manage manage can use to go through. Your full list of keyword both enable impose.
There are a lot of dynamic market condition that might make a good keyword a good keyword a matter of days. And if you do it manually, it's very, very hard to spot this change of trend.
Basically, it's a business owner managing ads shouldn't be so hard, shouldn't be so time consuming and it should be just not the main focus of your business.
And in addition, if as a business owner, you don't want to do it and you want to hire somebody to do it for you, the services that are around right now are extremely costly. Some services can charge you up to 50% of your ad spend and they're generally not good at optimizing your ad spend, they're just very good at increasing your ad spend because that's where they make the money.
Let's talk about what our solution can do for you. Our solutions 100% automated solution. We have an automatic smart contain and ad group creation which we name PGM, which with one push of a click we create the full ecosystem that I just showed you. We automatically segment your cue or mesh with the user smart negation. We can handle large account and huge data sets. We can handle thousands of campaigns a day, a hour, a minute. We can handle for you million of keywords and customer search terms and their reports. And we can run our automation multiple times a day. With the criteria that you give us, we can update up and down the bidding of your automated campaign, as well as the bid of each single keyword.
The benefit of such a system for you, for a seller, for Amazon entrepreneur is to maximize advertising sales and ads performance for months. Take guesswork out of the PBC. Create word structure campaign on auto-pilot. Save hundreds of hours by automating your PBC campaigns, not only saving hundreds of hours, but saving hundreds if not thousands dollars if you were to hire a service. And get your target A cost with just a few clicks. You can reduce your overall account echos and improve your profits. You can expand advertising in other countries and languages very easily. Leverage our profitable advertising strategy, that's what I explained. You can focus more on growing your business, rather than managing your ads and managing the gleaning of your ads. And you can stay ahead of the competition if you're faster, quicker. If you can spend more while making more profit, faster than the competition, you're going to always be ahead of them.
This is a couple of screenshots from our product. At the moment we are running a closed beta. Closed in the way we have a free beta. And you can apply on our homepage and website. We screen your account based on our criteria. And we are accepting our beta only accounts we think fits the most with our tool. Prefer that our customer use the software daily, our engagement is really, really high. And the product gets better the more that people use it. Because we receive that feedback of a user, and we do a change as soon they receive that coming in to make the user interface usability of the product better for the user as well as the rules more reliable. And we constantly add new rules whenever a user gives us a smart idea. If you want question the demo, feel free to just send me an email or go on our homepage.
Greg: I'd like to learn a little bit more about the tool. How many customers do you guys have so far?
Tarik: We have actually more than 150 accounts on board the testing and actually four months from November 2017 that we started the initial beta launched.
Greg: So how has the response been so far? How's the tool developing. Obviously when these tools are early you find lots of bugs and things that aren't quite working right, how's it developing so far?
Tarik: It's going great and I wish I was able to share the Skype chats or the one like Stefano shared. The feedback is great. It's a completely unique way in automating. I think Stefano will have a little bit product demo by the end of the conversation. Generally it's unique in the marketplace. You know we have some big competitors, even the big names. This product is completely unique of what they do. They are blown away when they have an initial, even in the initial call, but we have more follow up calls. So the feedback is great. We haven't seen any bug reports yet. We just need some new features, "I want this and I want that," kind of things. Even if we are in beta, we have been developing this software for two years. And Stefano is testing for over a year. And also this is I believe at that current stage pretty much a ready product.
Greg: Are both of you guys working on this full-time?
Tarik: Yeah full-time, I'm on this full-time. Day and night, even the weekends. We put so much on this. We see some automations popping up for other of our competitors even there. But when you're gonna see the the product, it's nowhere near that. We are way more ahead of what they do.
Stefano: Like right now full-time for last four weeks was like running, running ragged. Running simply because it takes a little bit of hand holding to explain people how to use properly. So basically we always have a one on one call with each single one of our customer. And generally even more than one. Because we go very in deep to how they can leverage the tool in order to reach their goals.
Greg: And then what's your plan as far as monetizing the tool?
Stefano: That's a good question. We had many iterations of ideas. What we realize right now is that the market is getting busy. A lot of people are having the same idea that we had one year ago, or two years ago, and are coming in and are aggressive and are smart. What we might want to do, we might want to be free for as much as my pockets allows in order to gobble in as many users that we can, which we are doing already right now. Because people coming from big company, and they use our software, have to say, "Why am I paying those people?" So the idea is to gobble in as many customers as possible. Reach a critical size and at that point start charging what could be not a premium fee, because we have so many user that even you charge the little bit it's going to make a lot of profit for us and a lot of revenue. That's the plan at the moment.
Tarik: And also I would like to add is that we have two customers actually. One of them is very big. He is doing more than all of our users combined. Even Stefano, even if he's doing a million dollars because he spends sometimes over a million a month. He's a big seller and he started in November, by the end of November. Our first users from Stefano's network and they were just blown away. They are employing three account managers to manage the whole account. And now by the end of the three months, they completely moved to our system, which we control in three campaign way as Stefano outlined in the presentation. Now, they switched to our system. Even if we can control their own companies with our automations, our system control companies has more control over the system. They go ahead and switch to our companies gradually and they complete it in three months.
Greg: Speaking about competition, as you guys know, there's about a dozen other companies in this space, competing for this same market. Amazon PPC automation tools. A lot of them probably have more financial backing than you guys do or a history in this particular sector. What are your thoughts on how you guys are going to compete with them.
Stefano: That's why we decided to go for the free beta. Simply for the reason you said. There are bigger people than us, bigger branding, longer history, bigger mentors and bigger personas behind the tools. But if we were to charge an amount, whatever fair, why people would trust us. So we decided to go free. We are free, come over try, you like it good, you don't like it go wherever you want. And we believe that this is the right approach because of reason you say. Because the market is getting old. A lot of people are coming in and a competition is competition. You can't be free.
Tarik: And they're also very powerful in terms of the technical features. This is what our customers are saying. We have rule hierarchy and we can be granular as low as keyword level or ad group or campaign level. You can assign rules. You can turn off, turn on rules. We can do anything that needs strategy to be applied. Our customers are aware of this automation tools that are available at the marketplace now. And when they see our software, they're blown away. The speed of the software. We are applying this automation three times a day. We have huge server power underneath it and very smartly coded algorithms and things in place to achieve this. Their feedbacks are great. The tool is really powerful and it's free. And we think that it's unbeatable in the market.
Liz: So I assume at some point though you'll want to move towards monetizing the product, right? You don't want to do it for free forever, right?
Greg: That's what I'm kind of thinking like Liz here, it's like okay, when it's just two of you guys, when it's just like a hundred users that's fine, anyone can get 100 users. Once you get a bunch though, now you're paying for engineers to be doing security audits. You need to hire a bunch of customer success people. Jungle Scout now, our AWS bill is more than $100,000 a month. How are you going to fund this with the growth as well? I think the free beta's fine, but I'm not quite following more the long term business plan.
Stefano: Because my business cross fingers is still very successful. Right now I'm moving enough money to be able to fund this. As for Liz question. We will start to monetize it. But we need to reach the point in which we are a recognized brand.
Liz: Got it, okay. And in way of price point, do you have a price point in mind for when you get to that point?
Stefano: Well, we started thinking about a fixed monthly plus a percentage on sales volume. And then we moved to just percentage of the spend. Like other services do. We don't have an exact amount in mind right now. But we will segment the ad spend or the accounts. We always have unlimited users, unlimited accounts, unlimited marketplaces, unlimited access to all the rules and potential of the tool. What we will do, we will look at the complete amount that you are spending across all of the accounts that you own, and we will base a fixed price from that.
Stefano: Just an example, if you spend from zero to $5,000 you might pay 50 bucks a month. If you spend from $5,000 to $10,000, you might pay 100 bucks a month. Don't quote me on the numbers. But that's the price structure that we are thinking to do. When we feel like we are a brand and we are somehow ready to compete with other brands.
Liz: Is there a way then when you move forward, because I hear what you're saying about wanting to build the brand and wanting to be free. As you transition that. Is there a way that maybe that, and Stefan I'm gonna use an example just as an example, but that zero to 5,000 crowd could be your free level, and if they go above that then you would have from there start pricing out, to transition that from where you're at right now with the totally free into the paid portion.
Stefano: What we thought would be a fair thing to do, if we get to the point in which we are running out of money, and Greg mentioned, the growth that is needed on the server and support to any human capital, is not fundable from my pockets, is to figure out the minimum possible that we can charge across all our customers in order to fund that growth. So assuming that we get to our user size of like 2,000 users, 3,000 users, and we run out of capital, we might to charge like five bucks a user, flat. In order to fund the growth while keep growing our brand recognition.
Tarik: And also we are looking for outside funding as well. This is much like a startup. So we would accept some venture capital deals maybe or angel funds at this point. Whenever we are shortage cash to be able to free for a much longer period of time.
Greg: What do you guys think are your biggest hurdles ahead?
Stefano: I see two hurdles. Right now is speed of coding. We have so much more ideas. Everyday we talk with a couple of three or four new customers and we get new idea of what should be called to code. We don't have the humans capital to do that. So that's the first hurdle that we have right now. So that's one bottleneck. And the second bottleneck right now is that it takes my time and part of Tarik time to onboard new people. So those are the two big bottlenecks. Sales team or success team, and a bigger developer team. If we get both of them, then me and Tarik can keep strategizing of what will be the most solution that we should launch first. And having our team work on it together.
Greg: What would you guys do with the $10,000 if you won the money?
Stefano: First thing comes to mind is sales rep or customer success rep. Somebody that can take the place of me and Tarik in introducing the customers to the tool and explain everything. Because that's really what's right now is taking away a lot of time from me. But I should focus on marketing and networking and connection. And from Tarik that needs to be present at the call because he should be focusing on managing and leading the team of coders.
Liz: I like the amount of listening that you're doing with the customers and everything else. I think that's going to help you develop a really focused product and go the direction that you want to go. I think that's really neat that you're spending a significant amount of your time right now onboarding and working on different features based on feedback from this initial data that you've got going on. I think that will lead to good things in the long run.
Stefano: Hard thing is the bottleneck. Because we are based not in USA. The amount of hours in the day, the time awake, while our users are awake, it's very minimal. So although we have three, four, five, six, sometimes 10 new users a day, I can talk with them only three a day. So the more we grow our user base, the more delayed gets the time to talk to them. Because we onboard 10 new people a day, sorry, we get 10 new users a day but I can talk only with three new users everyday. So really a sales rep, a customer success rep, it's extremely needed right now.
Greg: Guys, I have two final questions for you. Any final thoughts or words of advice you'd like to give on why you should win the $10,000 prize?
Stefano: Well, of course we think we are a revolutionary product. And we are free. And the $10,000 would really help in make it free for longer. And also better product. So that's my reason.
Greg: And if someone's listening to this in the future and they want to sign up for Zon Tools, where's the best place for them to find it or you?
Stefano: They can just go on our homepage, which is at www.zon.tools. And we have a bunch of stuff written there and there are a bunch of big pink button apply for beta. Just click on apply for beta. Give us the required information, and we will get back to you as soon as we humanly can.