Title: Mindset Moments:
Introduction
Welcome to Mindset Moments with Michael from Amazing FBA! Join me as we explore bite-sized thoughts and wisdom about business and life during my wanderings around London and Europe.

The Hat and Clothing Dilemma: Money and Time

Today, let's talk about the significance of a hat and some clothes in life and business. I have a rather fetching hat, similar to one Terry Pratchett wore. While it holds happy memories, it's time to part ways. Let's delve into two reasons behind my decision - time and money.
The Hidden Costs of Objects
Everything we buy has a cost, not just in terms of money but also in opportunities. Every purchase means allocating funds away from other potential investments. As an e-commerce seller, putting money into inventory means missing out on potentially more profitable ventures.
Neglected Inventory and Its Consequences
Long-term storage implications of owning inventory often go unnoticed. Whether it's stored in your closet, warehouse, or home, space has a cost. Cash is valuable, and tying it up in stagnant inventory can hinder your cash flow, affecting your business's financial health.
The Solution: Letting Go and Focusing on Profitability
To maintain a healthy business and life, it's essential to let go of things that don't bring joy or serve a purpose. Just like Marie Kondo suggests for personal belongings, in business, we should focus on stock that generates good profits and sells quickly.
Overcoming the Sunk Cost Fallacy
One reason we struggle to part with things is the sunk cost fallacy - the emotional attachment to what we spent, even if it no longer serves us. Business owners must overcome this fallacy and make rational decisions about inventory, cutting out items that are not profitable.
Conclusion
By evaluating the true cost of ownership and acknowledging the sunk cost fallacy, we can make better decisions in both business and life. So, as I bid farewell to my hat and clothing, I encourage you to assess your inventory, ensure profitability, and focus on what truly brings joy and success.

Do you want to take your business to the next level? Consider a free Amazon business audit to identify opportunities and threats. Book your audit at www.myamazonaudit.com if you're already doing a few thousand dollars a month in sales.

Thank you for listening, and I hope you found this discussion valuable!

The Sunk Cost Fallacy and Mike’s old hat – The True Cost of Owning Stuff

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Ecommerce brands face a constant challenge: maximizing return on investment (ROI) for their advertising spend. In 2023-2024, while social, search, and display advertising witnessed impressive returns, the current trend reveals a worrying decline. The knee-jerk reaction might be to throw more money at the problem, but that's a recipe for wasted resources.



The key lies in optimizing your approach. This guide dives deep into common mistakes e-commerce brands make and equips you with actionable strategies to improve your ad ROI, even with limited capital.



[00:00] - The Importance of Nurturing Existing Customers[01:02] - Introduction to E-Commerce Marketing Issues[01:44] - Overuse of AI and Need for Re-evaluation[03:10] - Lack of Customer Retention Strategies[03:54] - Bad Habits Growing in Good Times[05:11] - Relying on Amazon Data vs. Other Sources[06:08] - Oversaturation on Meta/Facebook Advertising[07:20] - Lack of Holistic Media Mix Approach[07:58] - The Concept of a 'Richer Message'[09:31] - Explaining the Marketing Funnel[11:09] - Simplifying Messaging for Customers[12:55] - Understanding Media Efficiency Metrics[14:11] - Importance of Frequency in Advertising[15:00] - Consistency in Branding and Messaging[17:04] - Bright Marketing's Services Explained



Rethink the AI Hype: Leverage Data for Smarter Decisions



AI has become a major trend in marketing, but relying solely on it can be a costly mistake. Here's why:




* Data Blindness: AI tools are powerful, but they can't replace human analysis of campaign data. Understanding what's performing well and what's not allows for targeted adjustments.



* Customer Disconnect: AI-driven targeting might miss the mark. Analyze past purchases to identify upsell, resell, and cross-sell opportunities. Don't forget – customer churn is a hidden cost. Analyze your data to identify and nurture your audience effectively.




Many brands rely on data from different platforms without a central source of truth. Consider implementing robust tagging and tracking systems in Google Analytics and Google Search Console to gain a holistic view.



Beyond Facebook Ads: Exploring the Evolving Media Landscape



Meta (Facebook) and Instagram, while popular, are becoming saturated, leading to diminishing returns. Here's what you need to consider:




* Audience Targeting: Success hinges on reaching the right audience on the right platform. Don't blindly buy placements based on cost alone. Understand where your target audience spends their time online.



* Holistic Approach: Many agencies solely focus on SEO and PPC, neglecting Amazon platforms. A complete media mix considers the entire customer journey, including top-of-funnel strategies like TV, billboards, sponsorships, and influencer marketing.




Media Buying 101: Understanding Efficiency and Effectiveness



Media buying involves acquiring ad space across various platforms. Here are key concepts to grasp:




* Cost per Mille (CPM): This metric indicates the efficiency of your buy. It represents the cost per thousand impressions.




The Power of the Marketing Funnel: Tailoring Your Message for Impact



The customer journey can be visualized as a marketing funnel with distinct stages:




* Awareness: Introduce your brand and product to potential customers.



* Consideration: Nurture interest and highlight the value proposition.



* Preference: Differentiate yourself from competitors and establish brand preference.



Stop Wasting Ad Spend! Improve Your Ecommerce ROI


Jennifer Sutton, CEO of Bright Marketing, a results-oriented agency for growth-stage companies, knows the challenges e-commerce brands face. With 30 years of experience in agency marketing, creative development, and consumer insights, Jennifer has witnessed the evolution of media consumption – but the core principles of marketing haven't changed.



[00:00] - Lack of Thinking in Business[00:50] - Introduction to Jennifer Sutton[01:32] - Jennifer's Background and Bright Marketing[02:21] - What is a Full Service Ad Agency?[03:55] - Lack of Thinking in Marketing[05:17] - The Role of Ad Agencies[06:18] - Smaller Businesses Bringing Marketing In-House[07:56] - No Formula for Media Buying[09:07] - Lack of Data-Driven Decision Making[09:29] - Defining Media Planning and Buying[11:18] - Understanding Media Buckets and Data[12:29] - Summarizing Brand, Marketing, and Media[13:31] - Clients Thinking They Have an Advertising Problem[15:43] - Selling Benefits Over Features"[17:19] - Defining Your Core Message and Value Proposition



While the "Mad Men" era of full-service agencies might seem glamorous, today's marketing landscape requires a different approach. Gone are the days of generic templates and a lack of consumer understanding. Today's success hinges on:




* Collective Creativity: Working within an agency fosters a cross-pollination of ideas, preventing creative stagnation.



* Disciplined Problem-Solving: Deep dives into your brand's specific challenges ensure solutions are tailored, not one-size-fits-all.



* Objective Insights: It's hard to see your brand objectively. An agency provides a fresh perspective to uncover hidden opportunities.




While the allure of a "secret formula" for media buying exists, the reality is far more nuanced. Success hinges on understanding your audience, their consumption habits, your unique offering, and crafting a compelling brand message.



The good news: advancements in tools and consumer data provide powerful insights. However, many businesses struggle to leverage this data effectively. This is where understanding media planning and buying comes into play.



Unveiling the Powerhouse Duo: Media Planning vs. Media Buying



Media Planning: The strategic roadmap for your brand message. Here, you define your ideal customer, their online behavior, and the best channels to reach them. This includes exploring options like influencer marketing, sponsorships, television advertising, digital media, and search engine marketing.



Media Buying: The tactical execution of your media plan. This involves negotiating placements, securing ad spots, and managing your media budget across chosen channels.



It's crucial to understand that media planning and buying are two sides of the same coin. You can't have an effective media buy without a solid plan, and vice versa.



Beyond the Formula: Building a Brand Story with Impact



Often, clients approach agencies with the belief they have an "advertising problem." However, the root cause frequently lies deeper – a brand issue. At Bright Marketing, we believe in building brands first:




* Business Objectives: We translate your goals into a consumer-centric perspective, crafting a brand story that resonates.



* Marketing Strategy: This defines how you'll communicate your brand message.



* Media Planning: We determine the optimal channels to ensure your message reaches the right audience at the right time.




This approach falls under a framework called the "Marketing Mix Model,

Media Buying vs Planning: Demystified!


Intro



Let's talk about rhythm, shall we? In your life. Now my background is a musician, and so I naturally think of rhythm. When I was teaching people and still conducting choirs evenings and weekends, I'm always banging on about rhythm. And what does that mean? Well, it's really about having a shape to time, if you will.



And that is something that's very, very important for productivity in life and in business. So today, now that I'm surrounded by a beautiful garden here and talking about seasons and seasonality is very much on my mind. Let's discuss rhythm and how that affects your use of time as an organic way of using and managing your time. Stay tuned.



Seasonality in Nature and E-commerce



Hi, this is Michael Veazey, and today I'm coming to you from our lovely garden. I think it's lovely anyway in Hertfordshire. So about a year ago, in May 2023, I was sent up by my wife to go find ourselves somewhere more peaceful to live. We were in a flat in London, a bit noisy, very urban, not really relaxing. We wanted a house and a garden, and we've got them.



The garden, of course, is a thing that really makes you think about seasonality. And today, I want to talk about rhythms in your business. We can start with seasonality and the overall shape of each year as a very, very good start.



Now, it's not rocket science to say that quite a few businesses or ways of making a living have strong seasonality. So the two that I'm most familiar with, my old profession of teaching and making music (I still conduct choirs in the evenings and weekends and love doing so), and e-commerce both have very strong seasonality.



Some jobs, I guess, you just grind along same old same old week to week and then have your couple of weeks off in the summer, and that's it. That is not the case for education. In education, my wife's still working very, very hard in the summer because lots of institutions have exams. So A-level students are having exams. My wife's off playing the piano for music colleges in London where people are playing very difficult music for their end-of-year exams. E-commerce is no different.



Embracing Seasonal Rhythms



In e-commerce, if you sell something that's giftable, you will find that it becomes crazy in Q4. In other words, November and December, just before Christmas or the holiday season if you wish to call it that. And of course, that changes everything about your year. The rhythm of your year, your week, and your day is really to some extent dictated by others.



To the extent that you recognize that, you get in tune with your market and the way things operate in your industry, then you will find that things work better. If you try and fight it or just ignore it, that's one of the signs that things are wrong. One of the things that is really important is if you do have a strong Q4-centric business.



By the way, a lot of people who are at an early stage or even pre-revenue entrepreneurs (I don't tend to work with those anymore) are obsessed with the idea that they can even out the sales, cash flow, and inventory and have a non-seasonal type business. But the truth is that the businesses that I know that do really well embrace the seasonality and roll with it. They understand that that is the nature of the market they're in.



Planning for Seasonality



Rather than trying to go in three and four different markets that magically balance each other out in theory (one could have that but in practice I don't see that), I see people who successfully manage the seasonality. So, I think you have to roll with the rhythms of your industry, your marketplace,

E-comerce business planning


Hey folks, I have some bad news that I think Amazon third-party sellers need to know based on Amazon's recent earnings call. Stay tuned. 



3 insights for Amazon sellers from Amazon's recent earnings call



So there are three facts in the recent earnings call, which I thought are a little bit scary for Amazon third-party sellers, and we need to join up the dots and think this through as Amazon sellers. Here they are: 



1. Amazon's profits are up - largely due to third-party sellers paying more for ads!



Number one profits on advertising up a metric ton, which means more expensive sales for us. So Amazon should say thank you to the third-party sellers.



And of course, we all know this from experience, but it is a fact, and it's clear that Amazon is, as it has been, continuing to prioritize using advertising as the main way of making not so much revenue as profit from its third-party marketplace and indeed the entire marketplace. That's the first one.



2. Investment in FBA is down - bad news for third-party sellers



Second one. Investment in the FBA system, which has been a big percentage of their capex, the capital expenditure, is going to be less as a percentage going forward. So that means less fulfillment capacity relative to demand, which is not good news for third-party sellers, of course.



It means that also our money is not being spent and being reinvested in the fulfilment system. So where is it going? Is it just going to the shareholders? Well, no, they're not interested in giving away dividends. It's still a growth stock as far as the stock market's concerned. So where is it going?



3. Investment in AWS is up



The percentage of capital expenditure going to AWS is booming. Now that makes sense for Amazon because AWS made about 65 per cent of their operating profits in the past year -  and their view is that that is going to grow like topsy because most computing power is desktop. So in other words, it's not on the cloud yet, but that is going to be a huge growth story.



Now that's probably true for Amazon. And if you want to buy a stock market investment, well, I'm not a stock market investor, but there is a little bit of a hint. Well, I don't, I mean, I invest privately, but I advise publicly. There's a bit of a hint there, isn't there? So you might want to consider Amazon as a great stock, not based on it being an e-commerce company, but it'd be in a pure sort of tech play as a platform for other people to do their tech work -  famously, even the CIA uses AWS! 



Implications for Amazon 3rd Party Sellers



Now, what does that imply for Amazon third-party sellers? Well, they are taking money from us. They're not giving it to the shareholders, but they're not reinvesting it in the FBA system either.



They are investing it in their most profitable division. And that makes sense, but you should be aware that those are two bad things for us. 



Bad thing 1: We pay more of our revenue to Amazon



Not only is the percentage of money that we're getting taken off. Gonna be bigger as we go because Amazon's squeezing it. 



Bad thing 2: Amazon will invest less in the E-commerce Marketplace 



But quite clearly it's seeing the, the future is AWS and the marketplace as a cash cow to squeeze, which means the investment in that I think going forward is gonna be less as well.



And that's speculation on my behalf. I don't have any in one on the inside of, of Amazon telling me that, but there's a bit of a major hint and that it's certainl...

Will Amazon Third-party Sellers keep having higher costs?


Welcome to another episode! Today, we're diving into the complexities of Amazon FBA and US sales tax compliance with Jared Smithson of RJM Tax Exemption. Jared's team specializes in helping American, UK, and other international businesses navigate the ever-changing landscape of US sales tax. With over 5,000 businesses under their belt, they're the perfect guide to ensure your e-commerce brand scales smoothly without unnecessary tax burdens.



[00:00:00] - "Need to File Sales Tax Returns"[00:04:55] - "Necessity of Paying Sales Tax"[00:06:04] - "Penalties for Not Paying Sales Tax"[00:13:10] - "Nexus for Non-Marketplace Platforms"[00:15:16] - "Using Resale Certificates with Wholesalers"[00:16:55] - "Corporate Structures and Sales Tax"[00:18:49] - "Mistakes by Established Sellers"[00:22:12] - "Acquiring a Business with Tax Liabilities"[00:23:33] - "Sales Tax for Non-Marketplace Platforms"[00:27:13] - "Managing Sales Tax for New Platforms"[00:30:08] - "Need to File Sales Tax Returns"[00:31:45] - "Special Offer for Listeners"[00:33:33] - "Closing Thoughts"



What is Sales Tax and Why Does it Matter for Amazon Sellers?



Let's break it down. Sales tax, essentially the US version of VAT, is a tax levied on the sale of specific goods and services. The rate varies significantly by state, county, and even city, with over 11,000 jurisdictions to keep track of! But here's the catch: even if you're based outside the US, you can still be liable for sales tax under a concept called "sales tax nexus." Simply put, nexus signifies a substantial connection with a state, which can be established through physical presence or exceeding economic thresholds. Failing to register for sales tax when required can lead to hefty penalties and back taxes.



The Common Misconception and How to Avoid It



Many sellers mistakenly assume Amazon collecting and remitting sales tax in certain states absolves them of all responsibility. While this may simplify things in some cases, it's crucial to remember that individual state regulations vary. Some states might exempt sellers solely on Amazon, while others consider economic thresholds or physical presence (like using an Amazon fulfillment center) as triggers for registration. Additionally, some states, like Washington and Texas, have unique legislation requiring registration even if you only sell on Amazon.



Taking Action: How to Register for Sales Tax



The good news: registering for sales tax is generally a straightforward process. Most states allow you to register online through their Department of Revenue website and obtain a sales tax certificate. This process typically takes 1-2 hours and requires your Employer Identification Number (EIN) from the IRS. Remember, many sellers overlook obtaining an EIN because Amazon allows them to operate without it. However, an EIN is crucial for tax compliance.



Reseller Certificates and US Business Structures



While this episode focuses on private label and custom product sellers, it's important to note that if you purchase inventory from US wholesalers, you can likely obtain a reseller certificate to avoid paying sales tax upfront. This certificate, based on your shipping address, allows wholesalers to recognize you're not the end consumer.



Here's some good news for international sellers: you don't necessarily need a US LLC or Corporation to sell on Amazon USA. Your existing UK Ltd company can suffice, provided you obtain an EIN.



Beyond the Basics: Considerations for Established Businesses



For established businesses with significant sales volume, incorporating a US entity offers advantages. A US corporation allows you to open a US bank account,

Unlocking Amazon Sales Tax Nexus: Do I Need to Register?

Amazing FBA Amazon and ECommerce Podcast, for Amazon Private Label Sellers, Shopify, Magento or Woocommerce business owners, and other e-commerce sellers and digital entrepreneurs.

The Sunk Cost Fallacy and Mike’s old hat – The True Cost of Owning Stuff

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