Amazon launch: risk v. opportunity cost

When is the ideal moment for your brand’s Amazon launch? Should you wait until every single detail on every single page is perfect? If the answer to that question is ‘no,’ then what is the appropriate threshold? Can you succeed if you’re only 75% of the way to where you want to be? Or 60%?

At Toucan, one of the most common challenges we help clients overcome is the evaluation of opportunity cost. In our lengthy experience, we’ve run the gamut of eager “dive-right-in” clients all the way to very detailed and extremely thorough. Every company has slightly different priorities, brand standards, and objectives. In truth, there’s no right way or wrong style for an Amazon launch. It becomes a question of risk tolerance (e.g., launching before your brand or customer experience is perfect) and opportunity cost (e.g., delaying potential revenue by focusing on granular details).

To navigate this dilemma in your own business, we recommend a construct of 3 P’s: think about perfection and what it means for your brand; force-rank prioritization to make your goals manageable, and start making progress as soon as you are comfortable. 

risk and opportunity cost graph amazon launch
As you prepare your Amazon launch, weigh the risk against the opportunity cost of delay.

Consider what ‘perfection’ really looks like.

In many ways, selling on Amazon is like playing chess. There are big-picture strategies and a clear objective to work towards, but it’s incredibly difficult to describe a “perfect scenario” because the game has infinite pathways that can lead you to success. 

Like a chessboard, your work on Amazon will have many pieces and moving parts, some of which you have more control over than others. As a mental exercise to help provide more clarity, slow down and truly think about what perfection would look like for you — think about as many aspects of Amazon, big and small, that you can name. Here are a few to get started:

  1. Image and Video Optimization
  2. Shipping & Logistics (FBA vs FBM)
  3. Supply Chain
  4. Pricing Strategy
  5. Sponsored Ad Strategy
  6. Opportunity Evaluation

We have broken down each of these topics at length and more. How does Amazon SEO come into play? What about paid promotional strategies? 

Imagining as many categories as you can should quickly reveal that pursuing perfection in 100% is almost an impossibility. In fact, by the time you reach a state of perfection, there is a chance that an algorithm will have changed, a new competitor will have entered the market, or the culture and audience you aim to reach will have evolved, ever so slightly. 

Think about what readily available resources and assets you have at your disposal. How can you best leverage these to ensure success with your Amazon plan? What you are deficient at is typically a good area to outsource, hire, or train up on. AND if you don’t have a plan or don’t know how to create one, reach out to one of our Amazon consultants. 

Amazon is always changing; that makes ‘perfection’ a moving target.

Chase perfection through prioritization.

car shell assembly line
How “complete” does your launch need to be? What is the threshold that’s right for you?

Just because perfection is almost impossible to attain, doesn’t mean you shouldn’t have it in your sights. It also doesn’t mean you should just launch a campaign on Amazon with the bare minimum of work done. There is a sweet spot, and we can help you find it. 

 

  • Start with the skeleton. What will it take for your product to end up in the hands of your customer? Production and inventory logistics, a seller account with product page, and strong product content. The last piece is fulfillment. Before worrying about anything deeper, have a plan for these priorities.
  • Add muscles & connective tissue. A skeleton can stand on its own, but you want yours to move. What efforts will you need to get your products noticed — like paid advertising? What will dramatically improve your customer’s experience and encourage them to leave positive product reviews? What can you do on your product page to help improve your conversion rates?
  • Add cosmetic touches last. Make-up and style can push your brand over the top and make it stand out in a lot of ways…once you’ve done the rest. Maybe this is the time to improve upon your HD product photos by adding a stunning video. Or you can test different product titles and descriptions to see what converts best. What about coupons and promotional campaigns?

 

Prioritization doesn’t mean you have to tackle your list in exact order (see these handy, general tips if you are stuck). If you already have an incredible product video, for example, you should include it with your skeleton as early as possible. But if you are lagging behind on a production detail because you are agonizing over the perfect product descriptions, you should rethink where you are spending the focus of your time. 

Typically, it makes more sense to spend time on more important factors (like product naming and sponsored ad efficiency) rather than less important ones. Not all Amazon ranking factors are equally weighted, so spend time on the ones that are more valuable and readily accessible to your company. 

Make progress whenever possible.

It should be noted — again — that Amazon changes regularly and the marketplace is constantly evolving with new competitors or new products. This means you will need to regularly learn and optimize post-launch, too…and therefore should get started as soon as possible. 

We started this post talking about opportunity cost. If your definition of “perfection” involves launching a billion-dollar brand identity, then perhaps launching prematurely would set the wrong tone and impact your audiences’ perceptions of you. But anything short of that lofty goal will be much more forgiving. The cost of waiting and delaying your launch could have real financial impact. In other words, every day you wait to tinker with one small detail is a day you could have had revenue coming in. 

Compare perfection to progress with real numbers

Imagine you are a seller who believes that, once your shop is PERFECT, you can make $1,000,000 a month. To achieve “perfection,” you want some HD photography, a product video with real life use cases, and really granular Amazon SEO-type optimizations of your content. You anticipate these projects to take 8-10 weeks.

You must choose to delay your launch date until you complete the projects and achieve perfection, or launch with what you have and make updates later. If you wait, you will have $0 in revenue for those 8-10 weeks.

If you launch with what you have, let’s assume you don’t make the full $1,000,000 a month, but a fraction instead. Even if you made 50% of that goal each month, you’d make $500,000 each month while working on the extra projects. By the time you update the HD photography, product video, and SEO-optimizations, you’ll have banked $1,000,000 or more over that timeframe. 

Remember, Amazon has over 150 million Prime subscribers and continues to grow every day. There is a tremendous opportunity waiting out there if you are able to start making progress.

Start making progress on your Amazon launch service

To start making progress, think back to the prioritization exercise and look at it not as a to-do list, but a roadmap. Then, ask yourself, “What is the earliest point I can take my Amazon brand live without suffering any negative repercussions?” We are constantly weighing these two factors:

  1. How much effort will it take to get started and then grow?
  2. What is the payoff in terms of the upside once we have achieved success?

For example, if you tried to launch before you had adequate inventory, you would be unable to fulfill orders and, therefore, risk being punished by Amazon’s algorithm if you go out of stock. On the other hand, delaying launch for a short while to improve your packaging (and customer experience) could be worthwhile if it means your early sales result in more positive product reviews that will benefit you down the road.

Navigate the nuances with confidence.

There is truly no right or wrong balance, provided you are able to think clearly about both risk tolerance and opportunity cost. If you have questions about priorities and a roadmap for launch, optimization, and growth, our experts are able to provide case studies and guidance. A conversation is always free, and just a click away.

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