Managing a large Amazon catalog can be challenging but also full of opportunities. The great news is that Mike Danford from Adverio recently shared some game-changing tips on the Amazon Strategist Show that could tip the scale in your favor.
Need tools and strategies to optimize your extensive product lines? Let’s explore what you can do.
First, why is this important? Optimizing your catalog helps your products stand out and sell better. Where to start? Focus on automation—Tools that update listings and track inventory changes save time and boost visibility.
What's the next step? Dive into analytics—Understand what's selling and adjust your strategies accordingly. This direct approach helps you pinpoint effective changes.
Ready to enhance your Amazon presence? Let's explore expert strategies for optimizing your large catalogs on Amazon.
Quick Overview of Mike’s Journey
Mike's journey in the Amazon space began in 2014-2015 when he launched his own product and brand. He quickly realized that one of his most significant expenses was PPC advertising. This realization led him to dive deep into the numbers, eventually leading to the creation of Adverio, which specializes in managing large catalogs for brands with over 1,000 SKUs.
Mike’s Tips For Large Amazon Catalog Management
The Power of Diversification
One of the key advantages of having a large catalog is diversification. Mike notes that with more SKUs, you have more options and are less vulnerable to issues like returns, thin margins, or promotional missteps. If you have a diverse range of products, you're more likely to have some "home runs" that can offset underperforming items.
Keep Pulse on Large Catalogs
Managing thousands of SKUs can be overwhelming. To address this challenge, Adverio developed a Profit Pulse System (PPS), a free tool that helps brands understand their ABC groupings (top performers, mid-range, and lower-performing products). This system allows for prioritization and helps identify areas where advertising spend can be optimized.
Key strategies for large catalog management include:
- Focus on underutilized SKUs: Often, there's untapped potential in the B and C tier products that haven't received much attention.
- Analyze ad performance: Compare advertising metrics to organic sales to identify opportunities for growth or areas where spend can be reduced.
- Monitor conversion rates: Compare ad conversion rates to overall listing conversion rates to understand if ads are helping or hurting product performance.
- Leverage AI and machine learning: These technologies can help prevent tunnel vision and ensure all parts of the catalog receive appropriate attention.
- Revive dormant SKUs: Sometimes, products that didn't perform well in the past may find success in the current market due to changes in trends or consumer behavior.
Listing Optimization and Case Management
For large catalogs, it's crucial to have a system for evaluating listing quality and managing problematic SKUs. This includes monitoring review scores, addressing category node issues, and deciding whether certain SKUs are worth keeping based on their performance and the resources required to manage them.
Pricing Optimization: A Game-Changer
One often overlooked aspect of catalog management is pricing optimization. Mike emphasizes that many brands haven't updated their prices in years, which can significantly impact sales. Adverio has been pushing dynamic pricing optimization, which has shown impressive results.
Key aspects of pricing optimization include:
- Competitor analysis: Understanding how competitors' prices change over time can provide valuable insights.
- Intraday pricing adjustments: During high-traffic events like Prime Day, prices can be adjusted in real-time based on traffic and conversion rates.
- BSR (Best Sellers Rank) protection: Pricing strategies can be employed to maintain or improve a product's BSR.
- Deal optimization: Leveraging Amazon's deal features can be an effective way to drive sales without relying solely on advertising.
Holistic Approach to Growth
While many brands approach agencies with specific issues like listing optimization or advertising concerns, Mike emphasizes the importance of a holistic approach. This includes:
- Revisiting neglected SKUs: Products that haven't been actively managed for years often have untapped potential.
- Utilizing Amazon's tools: Features like the Product Opportunity Explorer can provide valuable insights about your products relative to competitors.
- Staying updated on new features: Amazon frequently releases new tools and ad types. It's crucial to evaluate these and determine if and how they can benefit your brand.
- Pricing strategy: Regularly reviewing and adjusting prices can have a significant impact on sales and profitability.
When to Consider an Agency
Mike suggests that brands typically need to be at least seven-figure sellers before engaging an agency becomes cost-effective. The benefits of working with an agency include:
- Broad experience: Agencies work with numerous brands, providing insights and strategies that may not be apparent to in-house teams.
- Specialized knowledge: Some agencies focus on specific verticals, offering deep expertise in particular product categories.
- Team resources: Agencies can provide a "bench" of experts to cover various aspects of Amazon selling and step in when team members are absent.
- Rapid learning and adaptation: Agencies are often quick to test and implement new Amazon features and can share these learnings across their client base.
The Great Campaign Debate
One controversial topic in Amazon advertising is whether to maintain long-running campaigns or create new ones. Mike's experience suggests a hybrid approach:
- Retain original campaigns when possible, as they often have established performance history.
- Create new campaigns when necessary to access new features not available in older campaign types.
- When transitioning to new campaigns, expect a 2-week adjustment period before performance stabilizes.
- Use a "mirroring" technique when creating new campaigns:
- Copy all settings from the original campaign
- Increase initial bids by 40-50%
- Gradually reduce bids over a few days to original levels
This approach helps new campaigns gain traction quickly while minimizing performance disruption.
Inventory Management Strategies for Large Catalogs
Managing a large Amazon catalog can be daunting, but with the right strategies, it becomes much more manageable. Let’s explore some key tactics that can make your life easier and your business more profitable.
Boost Your Amazon Inventory Performance Index (IPI)
Amazon’s Inventory Performance Index (IPI) is a vital metric for understanding your inventory management efficiency. Are you struggling with excess inventory or stranded items? Improve your IPI score by tackling these issues head-on. A higher IPI score can save you money and stress.
Just-in-Time (JIT) Inventory System
Feeling the pinch of storage costs? A Just-in-Time (JIT) inventory system might be your solution. By reducing the amount of stock you hold, especially for slower-moving items, you can cut costs and minimize the risk of overstocking. Imagine having only what you need when you need it.
Amazon's Restock Inventory Tool
Wondering when to restock? Amazon's Restock Inventory tool can guide you. It gives you recommendations on when and how much to restock, ensuring you maintain optimal inventory levels. This tool can be a game-changer in keeping your shelves stocked without overdoing it.
Regular Catalog Audits
Are you holding onto dead weight? Regularly audit your catalog to identify and remove obsolete or consistently underperforming products. Streamlining your inventory can reduce costs and focus your efforts on what truly sells.
Use Amazon's Removal Order Feature
Got slow-moving inventory? Use Amazon’s removal order feature to clear it out and make room for better-performing products. This keeps your inventory fresh and relevant, boosting your overall sales performance.
Take Control of Your Inventory Management
Feeling overwhelmed by your inventory? Here’s a quick recap to help you regain control:
- Improve Your IPI: Fix excess and stranded inventory issues.
- Adopt JIT: Reduce storage costs by only stocking what you need.
- Restock Smartly: Use Amazon’s tool for timely restocking.
- Audit Regularly: Cut out dead weight in your catalog.
- Clear Out Slow Movers: Use non ppc promotions like buy one get one or put the items in the virtual bundle (while keeping in mind the eligibilities).
Implementing these strategies can transform your inventory management. You’ll reduce storage costs, keep your products available, and ensure a smoother operation.
Get Your Amazon Catalog Onto Next Level
Managing a large Amazon catalog requires a strategic, data-driven approach. By leveraging tools like profit pulse systems, dynamic pricing optimization, and holistic catalog management techniques, brands can uncover hidden opportunities and drive growth across their entire product range.
Remember, success on Amazon is not just about managing your top performers but also about nurturing your mid-tier and lower-performing products. By giving attention to all aspects of your catalog and staying agile in your approach to pricing, advertising, and optimization, you can maximize the potential of your entire product line.
Are you feeling overwhelmed by the complexities of managing your extensive Amazon catalog? Seller Candy is here to help. Let us navigate the complexities of large catalog management for you, so you can dedicate your time and energy to scaling your Amazon business.
Ready to transform your catalog management? Contact us today, and let's unlock the full potential of your Amazon business together.
