Aaron Conant 0:18

Happy Wednesday everybody. My name is Aaron Conant. I'm the Co-Founder and Managing Director of BWG Connect. We're a networking and knowledge sharing group with 1000s of brands who do exactly that we network and knowledge share together to stay on top of the newest trends, strategies, pain points, whatever it is that shaping the digital landscape. I connect with 30 plus brands a week to stay on top of those trends. also do a lot of advisory work and strategy sessions as well do a lot of work with partner selection. So if you need help in anything in the digital space, don't hesitate to reach out, we'll put time on the calendar. And always look forward to a great conversation. That's actually how we get the topics where our events is when the same topics come up over and over again as pain points that we host events like this. We've also launched a lot of in person events as well, small format dinners, so not the big 300 person events we used to do but small format dinner so anybody wants to have any information on those. If you're in a tier one city, shoot us a note and we'll make sure we'll get you on the list. A couple of housekeeping items as we get started today we're starting at three to four minutes after the hour, just you know, we're going to wrap up with three to four minutes to go give you plenty of time to get on to your next meeting without being late. The other side is we want this to be as educational and informational as possible. So at any point in time, if you have a question drop into the chat section, drop it in the q&a portion there the GoToWebinar panel or just email me Aaron aaron@bwgconnect.com. And and we'll we'll be able to get those questions answered. That includes, you know, an hour after the call tomorrow next week, don't hesitate across the board to shoot us a question we'll get you an answer. The network's be enough we have enough brands we can pay enough people we can usually get you an answer in under 24 hours. So getting me help, don't ever hesitate to reach out. So, you know started into the call topic today. This has just blown up over the past 18 months. It's a it's a routine topic, I think that brands are bringing up on an ongoing basis is you know, everybody. And their brother jumped out and started selling online during the pandemic, and brand protection and growth enablement and online marketplaces. And so we got some great friends, great partners, supporters to the network and a lot of brands in it over at Retail Bloom, we just asked if they would want to come on the line today, kind of give us an overview. They're helping a lot of brands out in this area. And they are also just, you know, great friends and supporters as a whole. And so, you know, we throw as many questions as we want at them. But also, you know, Nicole, kind of kick it over to you if you want to do a brief intro on yourself. And Retail Bloom, that'd be awesome. And he can do a brief intro as well and then kind of jump into the conversation Sound good?

Nicole Reich 3:01

Yep. Perfect. Thanks, Aaron. Hi, everyone. as Dan mentioned, I'm Nicole Reich, Co-Founder at Retail Bloom. I'm joined today by Andy Buss from our brand protection team. And just a quick background on on Retail Bloom. So I know this isn't our first webinar. So maybe a little bit of repeat, but I wanted to get into our core models. And then why this is so important to us on the brand protection side. So as you can see on this slide, you know, our two biggest models when it comes to marketplaces. So first one managed services working with a vendor central retail link through Walmart Seller Central seller Center, the brand has some type of portal that they're either b2c or b2b. And we're helping them manage that portal. So when we do that, obviously topics for today brand protection, but we're calling that up with content, customer service expansion. So a lot of times starting on Amazon, going to Walmart, doing marketing, advertising, and then doing a ton of reporting analytics insights right now, specifically around competitor sales estimates and market share data that's been really helpful. So that's one side of our business. On the flip side and blue. We also have our wholesale model. So you know, being a preferred seller, being a third party seller or assisting a brand with a hybrid strategy where they have both vendor Central and then Seller Central through us, which I know we've talked about in the last couple of months, we wanted to dig into one of the biggest things that comes up on almost every single call that we have with the brands we work on, specifically around brand protection and why the things on the right are so important to either of these models. So from your perspective, as a brand, you know, you may sell to Amazon, or you may sell to a third party seller. But it is getting much harder as Aaron mentioned over the last 18 months that if you don't have the right brand protection Foundation, you can't be successful on either of the strategies on the left, whether it's through us or on your own or or through another party. So we want to begin To the brand protection services This is so important to us that we have like I said Andy from our product team that only does this for brands and it really you know speaks to assessing like creating a brand assessment implementing that strategy and then enforcing it so we'll get a lot it will get into that piece of the business model today. As for an agenda we have four goals so the first one is how to lay a proper foundation this one would this community I mean Aaron and I talked about this I would say for the last two years I would say that it's probably some review for a lot of people on the call but there's some big things that are coming out that annual speak to of why it's more important today than it ever has been so some good tweaks on the foundation that might be helpful for you the second the third one are are huge what we talk on a lot of the time so let's say you're in the brand shoes and you have that foundation but you're having a hard time understanding the impact of it either negatively or positively when you do that foundation what can you expect what happens to buy box How do you quantify you know the impact of your of the the loss in sales when buy box goes from 100% to 80% so we'll give you some tools and exercises that you can do on your own to help quantify the opportunity or the impact of that so you can use that for internal conversations. Third, we'll talk about the other impacts of rent protection so you know there's $1 amount but then there's all of the other things on Amazon and Walmart that get a lot harder when you don't have that foundation in place. So we'll spend some time so here's the challenge and here's the solution into that and then we'll close out with a client case study so with that I'm going to hand it over to Andy to speak on the foundation portion first.

Aaron Conant 6:45

Yeah just really quick let's jump in just you had some more people join if you have any questions along the way drop into the chat drop into the q&a or email them directly to me Aaron aaron@bwgconnect.com if we missed anything along the way, you know, just you can jump out to our website and and just go to the events page and we'll post recordings and follow up to there as well. So anyways, yeah, Andy, kick it over to you.

Andy Buss 7:10

Alright, thank you. Thank you, Nicole. Also, I'm happy to be here today. It's It's fun to talk and present on this topic rather than just being in the weeds and servicing you know, brands on this day to day so hopefully I can shed some insights on this and feel some nice questions and help you guys out on this front. So first of all, we want to set up you know, how do we I guess why and how do we set up that crucial Foundation, the foundation that's legally enforceable to kind of launch our enforcement efforts keep things clean, right? So before we create or I guess, explain that foundation just wanted to kind of get the context and provide a few stats that I'm sure won't surprise you on many fronts here but kind of the context of why we even need these these efforts. So right now, about 33% of shoppers are going to go into a store I'm sure you've done it I know I do it all the time. And they're grab their phone and they look at a price on maybe a jacket or you know whatever it might be right Home Depot, I think I do this a lot Home Depot, unfortunately. But um, and then try and find the price cheaper, right on Amazon or on Lowe's, right, if you're at Home Depot, whatever it might be. And so 33.6% of shoppers do that while they're shopping now. Also, about 60% 58% of people say they'll stop doing business with a company online if they have a poor customer experience. And so that gets really to what Nicole were talking about in the second portion later on. We want to clean up the brand presence clean up the sellers, so that the content and everything you're presenting to the customers is proper, and you're able to service them appropriately right online, even if they order online. Also about half of online shoppers 48%. Now, head straight to the large eCommerce marketplaces like Amazon Walmart, right? They're not necessarily going to your store comm right to buy your product, they might say I just need a, I need a warm hat for winter, right? And they go to Amazon directly. And you're competing now against all of those brands to have them buy your product right away.

Nicole Reich 9:10

Yeah. So I might interrupt here, I just had read a report from Jungle Scout that they had released on some recent data to show that 75% of all consumers said that they started along other channels with their search on Amazon. And I believe it was like 60% on Google. And then you can you know, you can imagine that the the sites, other popular sites will be a little bit lower than that. But that was definitely new news. We knew that it was always going to be like in an upwards true direction. But I think the last time I saw a stat like that it was more 50% of shoppers searched on Amazon and now it's around 75%. So just wanted to give you guys a call out there. I'm not sure if you guys saw that report. And if not, you have questions I can send it to you. But Amazon is not going anywhere. Right? And Walmart's still closely right right behind it.

Andy Buss 9:58

Yeah, I mean this number is only going to go up That's for sure. And then lastly, just kind of a really big picture stat to kind of get set the set the floor for our discussion here. But over the last 1718 years, the World Intellectual Property Organization has seen their intellectual property disputes go up almost 400%. So you can see that numbers 11 102,003 over 4200. Now last year, and what we're saying with that stat is just, Hey, your intellectual property is important. It could get challenged, it's happening all the time. And what we mean by intellectual property, I'm sure you're familiar with it, right? That the copyrights the trademarks is kind of essential, what we'll be focused on here today. But domain names, right? And are those are those protectable? Are they not? Are they violating someone's trademark, all of those go into those numbers? So we really want to make sure we're protecting it properly. And then what problems are we trying to solve? Right, I want to make sure I guess that we're not just talking about a foundation that we aren't all on the same page about what we're addressing with that foundation, and why it's there. So and I know, we had some feedback from the attendees that even kind of set this up for us today. A lot of you were saying there's unauthorized sellers, right, that are affecting your listings, you can see on the screenshot to the right, the many different sellers on this one booth, right. And so it's 5950 in the buy box, but you can see it ranges up to 6995. And just the several sellers, I was able to capture on the screenshot. So we're trying to clean up those unauthorized sellers. That's kind of the first problem. Secondly, we want to keep the buy box right for either you or your authorized sellers, as opposed to your gray market and unknown sellers, we want to make sure we're owning that and not having it also suppressed, right? Whether it's owning it from making sure no one else gets it or just making sure it's not suppressed due to lower prices elsewhere. And then price matching that goes hand in hand with the buy box issue, right. So if if the buy box is being bought for this, obviously price matching and price fighting going on. Now other sites are starting to match the price algorithms between you know, Google and Amazon are going to lower your prices on those products. And there's loss margin there for you and your retailers. And we'll make sure your retailers you know, have a great relationship with you and keep buying from you.

Nicole Reich 12:15

Yeah, and this one on the price matching or suppressed by box. So we got some feedback before the call on some of the questions that go out to you guys. And asking and providing feedback. Before we hop on here. There was a comment about having another online retailer in this example, it was all tough, who's running a sale, for example. And what they're finding is, is that Amazon's looking at altos pricing, right when we talk about this a lot, usually when a UPC when you, when you can plug the UPC into Google Shopping, and you get all the different sites, that's a really good indication whether or not Amazon's going to be able to use that data to match their site. So an example of this last bullet, you know, for example, also runs a 30% off sale right now, Amazon sees that they either drop their price to match that automatically and maybe issue some charge back to the brand. Or they say, Hey, I can't compete with this from a profitability perspective, I'm just going to take your product out of search and or out of buy box. And what that is, is called a suppressed buy box. And it's Amazon's way of saying, either get the price as low as possible, or you're going to lose sales, because we're going to we're going to decide to serve a competitor. So how do you address that? Right? That's, that's part of the solution that we're trying to solve in today's session and give you guys that information. So that is just as an example of what we would call suppressed by box.

Andy Buss 13:37

Yeah, and I know we talked about this earlier, Nicole, a Walmart actually goes kind of one step further with that. And instead of just saying, hey, click here to view lower other prices on Walmart, if you're if you're not competing, right on price, they'll actually say your listing isn't serving, right, there's other prices that are too low, to be competitive, and your listing isn't active right now. So another really important reason to get this online. Finally, the last one we want to address is misrepresentation of the brand. And again, Nicole will touch on that in a bit but we're talking about the content, the bullets, the titles, all that the marketing and presentation of your brand that gets affected when other sellers are pushing information onto listings. Why do we need a proper foundation? Why can't we just reach out to people kind of willy nilly right and tell them to stop selling or shoot them an email and the reason really goes back to the first sale doctrine often talked about some of you may have heard of this before. But basically it goes back almost 100 years to a Supreme Court ruling so it's well settled many rulings on this obviously since then, and and it says, pay seller, right retailer or even just individual, if you come into possession of a trademark product and Nike shoe, a Bose headphone set. You're allowed to sell that again, right? You're not violating their trademark by selling that product a second time. And so that obviously presents a huge problem for brands right meaning Anyone can sell your product, they're not violating your trademark by doing it. And so we need to figure out a way to overcome that right to kind of knock that down. And so the way we do it is through a reseller program. And the reseller program is, essentially, it typically has three or four parts here, which I'll touch on in a second. But the core, I guess, the core teeth, let's say the teeth of the reseller program that really allow us to enforce are the material differences. And what we mean by material differences, our product characteristics that we incorporate into your reseller agreement. And then also quality controls, right how we suggest or kind of require our retailers to serve as customers ship the product, handle returns handle defective product, all that all those issues, go into quality controls, and then product characteristics, think of warranties or your packaging. There's a lot of different product characteristics that we can also incorporate into your reseller agreement to set the stage for your proper enforcement.

Aaron Conant 16:03

And I just want to jump in here really quick, because this comes up quite a bit. And because of the first sale doctrine, just so you know, for brands on the line there in unless you have something in place, like a reseller program that legally addresses this, they are 100% allowed to sell your product in if you're going to go out and file a trademark infringement or a counterfeit infringement because you know, Amazon will take them down. Like that is that's a very dangerous game to play right now. Because they've gotten very savvy and if their whole storefront gets shut down, and they don't have counterfeit product, and they're not infringing on your trademark, because they've legally acquired it and are reselling it. The ramifications are you your your brand will then be sued for lost profits for their entire store. And I've just heard some, you know, very, you know, that a lot of intense things going on in that space, they've realized they have another trigger to pull in the way around it is a reseller program that's set up correctly in the backend, but just a heads up, don't don't just go off willy nilly filing, you know, trademark or patent advertisements. It's it's not a good way or counterfeit. I

Andy Buss 17:24

Yeah. And I'm sure many of you have seen some sort of pushback from sellers at this point, either an attorney letter they had drafted sending, you know, saying, Hey, I'm allowed to sell and you're harassing me, or this is business interference. And at a minimum, right, we want to avoid those letters. But like Aaron was saying they could escalate that as far as complaint lawsuit, you know, go to arbitration, whatever it might be, but you want to avoid these these obstacles, obviously, and do it right. So

Aaron Conant 17:50

and another quick question that comes in is around, you know, this on both a, you seen this on an inner international basis. And are you helping brands with this seminar international basis? Is Well, where's it?

Andy Buss 18:04

No, that's a good question. And I mean, it is obviously becoming more and more of an issue for brands internationally also as right as the global marketplace now. So we we've helped, we've advised I wouldn't say we've done this same program or anything for brands in Europe or Asia, but we've advised, we know the setup in Europe, right? It's called selective distribution, there are ways to set up your programs similar to this reseller program I'll describe here, but there are ways in Europe to basically set up your selective distribution model, so that you have control over who's selling on your marketplaces, and who's your who your resellers authorized over there. And it's very similar and that you want to have those material differences ready to go. So if you let's say, you start with this program here with, you know, we work together, we set up your reseller program for the US, it's all good to go. There's a lot of that, that you can take and pretty much put into your European model. And I know, you know, Canada has a very similar structure now as well, to our enforcement. Obviously, the key difference is, there's no price enforce that you can do in Europe. So we always want to make sure brands are aware of that and not trying to enforce a map price or anything there. But it is something that we can assist with. And it's and it's similar in a lot of regards, though. Yeah.

Nicole Reich 19:17

The biggest difference summary there. Because Yeah, like you said, and we get that question a lot, right? So you can do reseller or similar reseller programs in Europe, for example, but the whole map piece, which is obviously super beneficial in the US, isn't applicable in Europe. Is that a good way to say it?

Andy Buss 19:33

Yeah, there's the protections basically, for the reseller program just don't, don't touch pricing. Yeah. And so within the reseller program, one to kind of highlight what I guess a typical reseller program would include. The reseller agreement is kind of the first document we always work on with a brand we want to set that umbrella structure up for the whole program. Secondly, there'd be an online selling application. agreement that we will create the kind of references back to the reseller agreement says, Hey, like we said in that agreement, you're only allowed to sell online given ABC, right, whatever we want to put in there for your brand. Thirdly, a distributor agreement if it's applicable to your sales channels and how you're selling us distributors. Nothing too complicated when we do distributor agreements, typically, but we want to make sure the distributor themselves right aren't some of those sellers hopping on Amazon and selling your product, because of the margin they have, we do want to make sure there's some minimal controls there. And then that map policy that's often discussed, kind of abused and misused often, but we often will also help brands create a proper map policy and, and work get into the reseller program also. And then, so when we talk about the reseller agreement, and obviously it is so key right to the overall program, I'm just wanting to kind of touch on several provisions that you would normally see within one of those agreements, we have an idea of what we're talking about here. Typically, there's introductory language kind of boring, right? But this is who we are, these are our brands. This is why we're creating this this program. And this is kind of what you as a seller are accepting you know, right by by executing this. Secondly, there be those product characteristics that we talked about. So this is what separates our authentic product, right, the label the instructions, that anything that goes with your product, from those unauthorized sales, to be quality control. So those two together, right, again, those material differences we referenced a bit ago, and then a restriction on online sales, because this is kind of the whole point, right of our programs, we want to restrict the online sales, and then reference the online selling application that's needed to do that online. So marketing guidelines, often brands have a resource where I may be a Dropbox, something like that, a portal that they allow resellers to access their proper images, their, their, you know, trademark usage, that type of thing. So you want to make sure that your marketing guidelines or your IP usage guidelines are available to the resellers.

Nicole Reich 22:05

And we'll talk about why that's important as it relates to other impacts of on authorized sellers on marketplace content and a couple of slides to that that's that's coming up a ton right now.

Andy Buss 22:15

Yeah, and then finally, the ability for your brand to change or even if necessary, terminate the agreement with the resellers, right. So we don't want you to be stuck in one place. This needs to be kind of a living, breathing document right and able to update it as we go, so.

Nicole Reich 22:30

A good example of this one, I was talking to one of our brands this morning, and we had helped them with this process, I would say about four years ago. So it was it was a I wouldn't say it was brand new, but it was a little bit stronger, it was a little bit more difficult, especially as it relates to distributors, because at the time of us getting this program going distributors were not on board with having to enforce a policy that the brain was telling them to do. You know, it's still a little difficult today, but it was definitely way more difficult four years ago, and this ability to amend and terminate, I bring that up. Because when we initially put this policy, we helped them, you know, put this policy together, there was a some language in there that said, Hey, you can be on Amazon. But you can only do Fulfillment by merchant, for example, you can't be crying, or you can't do Fulfillment by Amazon. So that are some, those are some things of when you have this, the ability to amend it, that language that might work two years ago, doesn't work today. And the language that you have today might not work a year or two years from now. So especially as it relates to the logistics and the fulfillment options, the challenges that we're seeing going into q4, it was important for them to be able to say, Hey, you know, before, you know, we needed, we could have you know, only three authorized FBA sellers and as many Fulfillment by merchant sellers as we want. But now considering how those are impacting bit by box, and potentially all the liquidation that's happening, you know, last year, we need to change that. And now we're going to say that there's a limit to the number of FBA sellers whether you're authorized or not authorized, and there's a limit to the fulfillment by merchants. So just as an example, when you're able to amend this, it's good to revisit this, you know, every 12 to 18 months or so because you want to make sure that you're keeping up with the changes in marketplaces or the changes of how this policy may impact logistics or fulfillment or other pieces of your business.

Aaron Conant 24:22

Yeah, that's a really interesting question that comes in. Why does it need to be a reseller agreement? Why not a reseller policy?

Andy Buss 24:32

Yeah, no, it's a good question. And and I get similar questions along the lines of why do we need to have one if we have an online selling agreement, right, or we already have an online selling agreement? Why do we need the reseller agreement and so we want an agreement onto the first part. So we want an agreement rather than just a policy. Typically now there's kind of a caveat to that, but we want that so that there's buy in from your approved sellers but but Importantly, we want it so that if you get challenged, right, what and we're talking about pushback from these gray markets, you know, more savvy sellers. Now, if you get that pushback and your challenge, let's say you land, you know, an arbitration or court just picture that, right? This is kind of the the end goal that we want to make sure we're set on. You want to have, you want to say, No, look, we connected with our retailers, this was a real policy or real program that we put in place, there was buy in, they read it, they signed it, this is a real thing with our authorized retailers. It's not for show, right, we didn't just send out a document, Hope it landed in their lab, we take this seriously, our approved sellers know what our authentic product looks like. And that's why you want ideally, to have the sign, you know, acknowledged by your retailers, your authorized retailers, as opposed to just a document that goes out that they may or may not read. The lawyer answer right kind of gets annoying, but it's true. Every case is different. It depends on the facts. And so when you land in front of a decision maker, Judge arbitrator, whoever it might be, you want as much security in your position as possible. And if you just said, Oh, we blasted it out in an email, they're gonna say, oh, wow, that that really mattered to you, right? Like, you want to make sure it looks as real as possible when you ever get challenged. And I won't, I won't be long winded on this answer. But it's essential to also have that reseller agreement along with an online selling policy, because if you only have an online selling agreement or policy, you're only capturing or communicating with the best actors, right, those those actors who want to behave, they want to go along with your guidelines, they're gonna fill out your application, you're not capturing or communicating with or seeing the rest of your landscape of sellers who are unauthorized gray market staying under the radar. So hopefully that makes sense. We want to kind of throw the blanket out broadly with that reseller agreement, and then narrow it down to the online selling. So that kind of sets the stage right with that foundation. Now we're talking about, okay, when that foundation is in place, how do we monitor effectively? How do we actually have some enforcement now with teeth that can see results? So there's really four keys that every sale when we focus on for enforcement. The first is visibility. And this is number one for a reason. Because if you can't see what's going on, if you don't see the problems that are out there, right, then obviously, there's no way to address them. And to the right, you'll see that screenshot. That's just a shot of one of the tools that we use, it's a it's a it's called seller site, it's a marketplace focused on enforcement tool, and we're able to really address almost any marketplace that you can think of Amazon, and Amazon International, all of those. And what we're able to do with this tool is scan for all the sellers that sell your brand, notify them through the back end of their seller accounts, and basically say, Hey, can you verify that you have real product? Right? It's It's a unique tool, because we're a not claiming counterfeit, right, and B, we're not taking the let's say, legal cease and desist, you know, you're infringing on my trademark type route yet, right? This is more of a, an easier tool that can go after sellers in bulk, and communicate through the back end of the marketplace. And that's why we can see some really large number results, as you see there with you know, for almost 1500 on authorized seller shut down for this brand 3600 listings shut down. And so this is a kind of a nice and I would say even easier, easy to use tool for some both marketplace, cleanup of some unsophisticated sellers is how I would describe this. So happy to describe that more, obviously, but you know, get on a call with any of you guys. But it's a really fun tool that sees really good results on marketplaces. So visibility is key, right? We need to see what's out there. We can do scans preliminary scans with this tool as well to just see, hey, how many sellers are on your marketplaces in general, right? Like what's out there right now. Secondly, I would say efficiency is really key. And, and so whether it's a tool like this, or are other tools that I'll get into in a second, but that see the entire internet, and are able to enforce that way, we need some way to address if you have 1000s of listings out there, right across several marketplaces and retail websites. That's way more than I know, I could take on, you know, personally monitoring and enforcing I'm sure it's more than maybe your econ team can do and monitor. So we need some kind of tool that can automate some of this, that can give us the visibility and the automated enforcement that we can use to efficiently enforce instead of having to manually send out emails, right. And just to kind of go further with that visibility point. That first tool highlighted red was a marketplace focus tool. So you can see here, the other tools we have available, lets you see not only the marketplaces on the right there, right all the marketplaces you're selling on, but also the retailer selling your product. And you can see on that bottom line, over 360 retail websites, sell this brand product and so we if we just look at marketplaces, right if we're only trying To clean up our marketplaces, we're missing, you know, possibly hundreds of retail websites that are also competing for the price, pushing content and images for your brand. And so we want to make sure we see everything to address the root causes, right? Who's who's moving first, who is putting that price up the Amazons matching. So the marketplace visibility is great, but we want to make sure we see beyond that. And then number three, key for monitoring and enforcement would be the customization, we want to make sure that it's not just a one size fit all solution that we as you see, on the left there some of the settings within our partner tool that we use to enforce you can see there's a lot of options for Are we going to enforce on retailer websites, or you can pick which marketplaces you want to clean up initially and provide a buffer right maybe for for your sellers, if they're within 10 cents, you know, let's let's let them go. But there's a lot of different ways to set these settings, so that you enforce in the way that makes the most sense for your brand. Then finally, permanency. And I think this is right behind maybe visibility in terms of importance. But when we do this important when we when we see what's going on and enforce on it, we want to make sure it lasts right that it sticks and the sellers aren't just relisting or coming back in some other marketplace, some other name. And so that's why we lay that foundation initially. And then use tools like these that we have available at Retail Bloom to communicate either through the Marketplace, but more importantly directly with the sellers. We want to communicate to the sellers with an email, phone number, whatever it is, and be direct. And we we do have that foundation to say hey, cease and desist, right? Like you're not allowed to sell, we have the trademark, and you're infringing on it. And here's why. You know, we have this reseller program, and then you actually are, you know, legally taking them down, and they're legally then not allowed to keep selling, right? They're infringing on your trademark, as opposed to just maybe Amazon taking them off on Brand Registry or, or some tool that's going to take them down, but they never understood or communicated to them that they're infringing on your trademark. So you want that lasting effect of the enforcement as well.

Nicole Reich 32:07

Hey, Andy, before we go into kind of quantifying the opportunity, or you know, what's the ROI on a program like this, even Aaron had brought it up about, you know, kicking people off through Amazon, I mean, obviously, you know, seller sites been very effective for us, just because it works a little bit differently. But can you talk a little bit about Brand Registry because I think that's where that program has changed a bit. Um, you know, we've seen brands start to abuse it. And I think that's part of the reason that it's, you know, brand red, the Brand Registry team isn't as responses they used to be because, you know, we've heard problems in the past where brands would use Brand Registry to say, Yep, this is an IP, you know, this is counterfeit, and then they're cutting off sellers who end up having legitimate products. So now Brand Registry, you know, isn't as effective or other tools just because you had a bad players kind of abusing the system. Can you talk a little bit about what the purpose of Brand Registry is, as it relates to IP counterfeit what you can and can't do through that through that portal?

Andy Buss 33:12

Yeah, no, that's a really good call out and I did want to make sure we touched on that because I hear from a lot of brands like well, it's fine. We have you know, we're submitting listing through Brand Registry, we expect you know, to have this cleaned up soon and, and there's a lot of, I don't even think it's brands fault, a lot of time it's often kind of Amazon communication, that's not great on this. And there's a lot of confusion around Brand Registry, what is good for what can I expect from it? And what I'll try to make it simple for you really, what what Brand Registry is good for, as far as I've seen, what other brands I've worked with the experience we have is, um, if you have a significant counterfeit issue, right, I was gonna just say counterfeit issue in general, like, even if it's small, but I'm working with some brands right now that have this one listing that is fairly counterfeit. It's from an overseas seller, not the same product, and they're not getting any response from Brand Registry. So I would say some sort of significant counterfeit issue, right? These are not our products, they're infringing on it, we don't these are not real, okay? That that they will respond to typically. And then secondly, if someone's using your trademark and you sell shoes, and they're putting your trademark on, you know, a laptop or something like that, where it's like they're using our trademark and that is not our product, we don't even make that type of product. They'll they'll step in, right you can obviously prove that so what your trademark applies to and they'll address that typically, what it doesn't tell and this is I think the focus of this conversation really is unauthorized sellers. They they say in their seller policy Amazon does that we all agreed to we sell on Amazon, that it doesn't help it doesn't help brands or it doesn't help you know, sellers enforce their contractual work the word but their contractual relationships right with other businesses, basically, and what they're getting at is this reseller program, it's exactly what they're kind of trying to avoid. They're saying, hey, you can do whatever you want. Do what you You need to do brand by creating your program, setting up relationships through contract with your authorized sellers and creating that protection. But we as Amazon, as far as we're concerned, first sale doctrine, right, everyone's allowed to sell, we're not going to go in there and kick off people willy nilly and take your word for it on your reseller program versus some other brands and, and so it's up to the brand to protect against unauthorized sellers, just because you don't know who a seller is, Amazon's not going to step in and take them down.

Nicole Reich 35:28

Cool. Awesome, thank you. So I'm flipping through our next topic for today kind of quantifying the opportunity, like I had said in the intro, a lot of times we get, you know, this is like, the least exciting thing to talk about, because it's a lot of work, and you don't really see the return. And you got a lot of different teams internally, right? You have sales that are looking at something like this and saying, Okay, this is going to impact my sales for this month, you have the eCommerce team fighting back to say, Hey, we don't get these guys cleaned up, I'm spending a lot of time on content. And then you know, then, of course, investing in some type of policy or even the software, right, all of that has a cost to it. So we wanted to outline a little bit for you first, from a qualitative perspective, and then I'll get into some exercises you can use to actually tie $1 amount to this, but you know, what are the costs one of the benefits from quantitative first, and he will do that, and then I'll get into kind of the dollar amount. So Andy, back to you on this as I shift through these and hopefully don't make a ton more mistakes.

Andy Buss 36:28

No problem. Yeah. So and like Nicole was saying these are more your qualitative, and I'd say objective costs and, and what makes a will makes it more difficult to put $1 amount like let's say on this presentation for each of these, right is it's different for every brand. So that's why we're we're not putting $1 amount for like the cost of service in the software, right? It's gonna depend on your brand, the needs that you have. And so these are just some general kind of points and the cola get into, you know, how you can do some more dollar amounts or attach dollar amounts to this. So for your costs are obviously going to be the software, the service, right of running that software, doing the enforcement owning that platform. Next, there's going to be always some time and some effort for your team. Once you even have those policies set. Do you need to communicate that with your your retailers, you need to tell your own team kind of educate your team on why we're doing this. Here's what the point of this all is, right? There's some time and effort there. And then you'll see a little bit of reduction from in your overall brand sales on the marketplace is typically right because what we're doing is taking a lot of those random sellers down who might account for 3040 60% of your brand sales right now we're removing them and not to fear because one of the benefits I think I'll list this first is that your approved sellers though, there'll be some lag, obviously right? And those in those buy boxes shifting over and whatnot. But you'll see your approved seller start to pick up some sales volume number one, I think that the next point is that Yeah, exactly, you're going to regain more pricing and you're going to regain margin. So there's your proof sellers are gonna not only pick up sales volume, but each sale is going to get them more money right because their margins going back as we stabilize prices. And of course, both of those first two points are going to lead to a stronger relationship with your approved sellers, they're going to appreciate it which actually like just pause everything for a moment and working with some brands right now I get this question a lot that you know there's pushback because we don't want to ruin relationships with our retailers or it's really difficult to communicate why we're doing this but I just want to kind of loudly state that this is actually really good for your approved retailers you should not be you're putting into place a reseller policy because the right communication with them helps them to understand that actually it's going to protect their margins it's going to protect pricing on the internet they don't have to fight with your lot your might be giving them access to some marketing materials and formalizing all the authentic you know, authentic aspects of your product for them so they can feel stronger about selling your brand. So it's really a great thing for them. I'm sorry, so Okay, finally benefits right? leveled the playing field for your retailers and you're protecting Now, those sales and your authentic sales on the marketplaces. And then as Nicole is gonna get into right now we create more of a consistent brand presentation on your listings, your titles and all that will stay more cohesive.

Aaron Conant 39:16

Awesome, really quick question that comes in is what are the three best sellers on Amazon is is not what if this three piece seller is on Amazon and it's not a trademark infringement? You still able to take-

Andy Buss 39:31

The three p sellers on Amazon and it's not a trademark infringement.

Aaron Conant 39:36

So this gets into the authorized reseller policy and that's my guess. Right?

Andy Buss 39:42

Gotcha. I think we're, I get where it's going. Yeah. So basically, that would be something you wouldn't handle through. Like with the illegal you know, trademark infringement route. You would actually because you have that you have that seller as an approved seller. Currently, it sounds like you would actually go-

Nicole Reich 39:57

On a personal so it'd be like a real dollar that has legitimate inventory. Gotcha.

Andy Buss 40:03

Okay, yes, then yeah, you use the trademark you to go basically, hey, cease and desist, you're not allowed to sell you're infringing on our trademark, you'd escalate that language, if necessary rights and send more notices and more letters, if they don't comply, then this is why we have that foundation that we talked about, we are able to go offline and set you know, let's get an attorney to send a draft complaint and say, here's the damages you're looking at if we go forward with this, hopefully, they're you know, they go down at this point if they don't, like, you know, like we talked about you have now the backing to take that as far as you need to whether it's you know, court you know, threat of lawsuit, whatever it works to get them down.

Nicole Reich 40:39

So what you wouldn't be able to do without the reseller policy without the E comp policy.

Andy Buss 40:45

Exactly.

Nicole Reich 40:47

Okay, so this is the let's say that you don't have any of this in place, and you have this bypass problem. And you and you have some people on your team saying, Hey, you know, I got problems with sales, I'm having some inconsistency is especially on the vendor central side, where one month and asen will do great, and the next month, you know, it'll be in stock, but all of a sudden, it the sales drop off. So here would be a manual exercise through vendor Central. And you can also do this through Seller Central and the business reports. But this is the way that we estimate the cost when you see loss by box. So loss by box occurs because of either out of stock, which we're not going to use as the example today. It is caused by through third party sellers dropping price and then you know, Amazon or another seller not being able to be that buy box because they're a higher price. Or it's from that suppress buy box, like we talked about earlier, where Walmart has a lower price than Amazon's not going to beat it. So they're just not going to serve you. So in all of those scenarios, we consider that loss by box. And what we did on this slide is try to give you an example of how you can calculate the loss and sales due to loss and bilock. So within vendor Central, you're going to go to is you know the snapshot or the sales analytics under the vendor central Amazon analytics tab, and you're going to scroll down, do you see this loss by box report. And in this example, you can see on the right for the top asen for this period, that asen saw about 51% loss by box. And that was about 40% of the total of the total buy box that that happened on the account for that time period. You can see compared to the prior period, whether it's going up or down. But let's just say for an example, this particular set of basins in q1 did about $1.5 million in sales, and they did 10% by box last by box. So if you just multiply that 1.5 times 10%, you could estimate round numbers, it's not very specific, right? As soon as a lot of traffic and conversion are consistent, but you could estimate that you're losing out at $150,000 in sales even more. So if you had two time periods that were considered pretty. The same things were going on right you have controls in q1 to q2 so you probably wouldn't want to compare q1 to q4 to do this exercise. But let's say that you know the products are pretty evergreen, they stand by that conversion is consistent, traffic's consistent. Well you have that $1.5 million in q1 and then in q2 we saw 1.2 million with 25% by box well in that example you could calculate that you know we lost we would have picked up another $300,000 if we would have just been in by box so this is pretty manual I wouldn't say that again that is you know 100% accurate but if someone from an internal team that said you know you were saying hey this buy box thing is an issue and they said well I don't get it you know what's the cost What am I losing out this is a good way to show them in the beginning you know if we were to have buy box this is probably what we would have seen in sales and if you don't have one P and you're on the seller central side you go to the business reports you'd pull in the buy box that gives you what your current buy boxes and then you would take the inverse of that to see what you lost out on so hopefully that's helpful usually we start with this if our brand doesn't have a software but if they do this is probably even more impactful so what we hear a lot of what is in front of you right now is a chart showing the three piece sales in blue the one piece sales in purple and then the market share in green so we're able to do through software which you know Aaron and I actually will be on call next month to go over this because it's been super insightful for market share but for purposes of this conversation you know we hear a lot Hey well if I buy box loss on Amazon doesn't really matter to me. Another third party seller will just pick up the sale. I don't really care they're still buying it for me. Yes, I guess but you can see here that one one p loses by box right there sales dropped down. Three p Yes, of course picks up a little bit. But there Not gonna pick up all of it. And more importantly, the market share goes down. So this happens because when Amazon loses buy box, you lose your ability to advertise. So yes, you're losing a sale to a third party seller, or you know, they're picking it up in the short term you're getting in the sale. But in the long term, it's impacting your organic rank, because it's impacting your ability to advertise. So this would be a case and you can see this happen with the arrows at the bottom here, over the time period that Yeah, three p will pick it up, of course they will on that day, but going forward, you're losing market share, and it costs you more to advertise to get back up in organic ranking. So there's a couple of different, you know, technologies or software out there, this is the one that we use, that's been helpful. But you know, it speaks to Yes, we have to invest this time. But if we don't invest in this type of program, if we don't invest in the software, or you know, getting people on the same page, we're just, we're leaving out market share to our competitors who do have it together. So wanted to point that out. The other thing, you know, that would be more of the dollar amount to it. I wanted to get into the impact of brand protection on marketplace efforts. So let's forget, oh, sorry, I'm-

Aaron Conant 46:15

Oh, no, no, that's fine. We were cruising along, you just have another question that comes in. There's we're experienced sellers from Asia offering their products at half off retail e sellers, then own the buy box, and collect all the sales for one to three days, ship confirm orders, but never actually shipped products. You know, we've placed orders submitted cases to Brand Registry with no resolution since no product was shipped to verify the counterfeit. You know, each time it's occurred, it's a new seller, their accounts get removed. You know, any thoughts on you know how to address that it's the USB pop up for one to three days and steal all the, you know, which is the same person over and over again. But yeah, it gets taken down, they have another one popping up.

Andy Buss 46:58

I'm just gonna say I mean, in general, because even if sellers and this is their difficult, right, if they're located overseas, in Asia, wherever they might be, but in general, it's the same, I guess, approach really with those sellers as it would be with us sellers, because they're selling into the US, right, they placed product on amazon.com, which is available for sale in the US. So they are now subject to us trademark law us, you know, guidelines, regulations, everything. So it's the same approach. It's just we need to find out who those sellers are. But you can do the exact same thing and basically take it as far as you need to under trademark law and make them stop, I guess is the best way to put that in a nutshell.

Nicole Reich 47:39

And then if you don't know who they are, because a new seller has always popped up, right, like they have one seller central account, maybe you find who that is they come down through Brand Registry, which is an effective way. Like that is a great way to use Brand Registry. That is the purpose of it. So I know it takes a while but you're not in any trouble. If you submit those. That's what it's for in that scenario. But I would say as you know, if you can't find the seller, send us a list of the the seller name one of them and we can look in our database to see if we have their contact information because like Andy said, you're going to want to take legal action on this probably and you know, if the seller pops up and pops down going through Seller Central probably isn't as effective as getting a physical address or phone number or an email address.

Aaron Conant 48:21

And the last thing is a comment that comes in is you know, if you're losing the buy box, right, and you're on the either side vendor, I should say probably more on the third party side affecting your overall allocation on warehouse space. Right if you're losing it and other people are removing more product than you they'll be allocated more inventory space. would you would you agree.

Nicole Reich 48:48

With the FBA restock limits? Yeah. Yes, um, I don't know if I'm going to Yes, that does happen. I guess the thing I would say about the third party sellers, let's say that you have six approved sellers and one of them all of a sudden breaks math, right? Well, they're going to own all the buybacks and their sales are going to go up significantly. And what's going to happen to the other third party sellers is they're going to sit on that inventory and they're going to come back to you and say Hey, guys, you know, I ordered this I prepped for q4 I buy box was down 20%. And I need an RTV. Now so I don't know if that directly answers the question. But yes, one pricing is consistent when sellers are consistent. It's the best way to get around planning and say hey, this seller is going to carry this much inventory. This aligns with the FBA restrictions. They have enough inventory to continue to send into Amazon so that they're not sent they're not sitting on inventory and then impacting your FBA restock limits. So yes, keep those consistent, keep pricing consistent. It does make it easier to plan for q4 and to plan that you know each seller is only going to have so much allocation in those warehouses and when you keep it you know, like I said consistent then it's easier. to anticipate which sales from each seller? I don't Aaron, I don't know if there was a question that but hopefully that's the way to and-

Aaron Conant 50:09

I think we covered it awesome. Just want to make sure we're addressing them. But yeah, I'll kick it back over to you just to make sure we get to this last part here.

Nicole Reich 50:17

Okay, cool. So we got about three minutes. So I'm going to go through these pretty quickly. So what are the other benefits? I'm talking marketing eCommerce teams, when you have a brand Protection Policy or program in place, what do you see consistent brand presentation, right? You have sellers who know their role in the how, what they are supposed to be doing online. So for example, Andy mentioned that, you know, there's some marketing assets that as an authorized seller, they are able to use or more importantly follow? Well, what I would say in that scenario is that for your authorized sellers, you are creating the content through your own vendor central Seller Central, or whatever it might be, and you're giving them that Ace and last or list or that Walmart ID list, you have the keys. And then at that point, you don't have all of these other sellers, overwriting your content or creating new variations. There's an example that I'm not going to get to because we're we really are running out of time here, which is great, good problem to have. But um, we hear a lot about problems about bundling, right where sellers out there will create their own variations, their three packs, four packs, create whatever UPC that they want. This is another way you include that in your reseller agreement to say that that isn't allowed. And it's a way to take action on those people that are creating them. So when you ever have, you know, your brand protection policies in place, you have the keys to your the best way of getting control over that consistent brand presentation. And you also have that holistic market share visibility. So in that authorized reseller agreement, hey, great seller, you're authorized, but you need to give us tracings. Do you need to tell us your ad spend your ad revenue, your sales on Amazon versus Walmart versus your b2c site, you're able to collect all of that data in one place, and then really have an ability to say, okay, what's my sales online for my entire brand, not just the seller? And what do I need to be investing as a whole and every seller or in Walmart or in Amazon, to hit my new forecast goal, instead of it just being a little bit more choppy and not understanding who's selling what. And then lastly, we talked about the strategic advertising efforts in the sense of, if you lose by box, you can't advertise? I want to I want to go forward, I have a slide here for advertising I'm gonna skip to So in this scenario, we get a lot of these questions, right? So why aren't my ads not running? Why aren't my ads running? Why is my cost per click increasing for branded terms and that scenario, let's say you know, your your Coke, you want to start bidding on sponsored product ads for coke. And you see that the cost per click is just going up and up and up. But you don't see competitors on your listings that's happening because you have other sellers bidding against each other for the exact same term. So within this authorized reseller agreement, you're saying hey, this is our advertising strategy. In order to be approved you have to follow it and it brings that cost per click down. Now there's like I said, in the holistic approach, if you had other sellers bidding on certain generic terms, or you're splitting up your portfolio to say, hey seller, you can sell these products and bid on these terms, you're getting all of that information back and you're able to say, Okay, this type of product line for example, is doing well. Let's see that where maybe this product line isn't as great of a fit for Amazon let's discontinue our efforts there or move them around. So understanding who the sellers are getting those tracings from them It gives you the visibility to take action and it's not always bad to know hey, this ad didn't work or this type of categories too expensive if you don't get the data you don't know how to make decisions so I did have some other ones we will have this to send out I really just want to make sure we're respecting everyone's time and we talked about the lot of the content advertising and if you do have any questions on that would be happy to connect again off the call but Aaron, I want to pass it back to you are there any other questions that we didn't get to today?

Aaron Conant 54:22

No, I mean there's I think just because the closest of time he'll wrap it up but you know any other questions more than happy to connect anybody on the call with Nicole and the team at Retail Bloom afterwards they're all around great friends partners, they're experts on Amazon one p three p actually run their own three p business so they understand that side intimately and the importance of well I feel like wait a minute why? Well they know so much about brand protection is they run this for the brands that they buy wholesale and resell and also the brands they own so incredibly knowledgeable in this area worth a follow up conversation for sure. If you have additional questions in this area, more than happy to to connect you with After the call with on our side You know I'd love to have a conversation with anybody that's on the call if you have any pain points any place on Amazon direct consumer side, drop shipping international expansion more than happy to set some side of time, some time aside on the calendar would love to have that conversation with you pick your brain as well and just networking knowledge share and with that I think we're going to wrap it up you know look for a follow up email from us. You know to connect you with the team at Retail Bloom but also to see if you have time to chat with us on our site as well. hope everybody has a fantastic Wednesday. Have a great rest of your week everybody take care, stay safe and look forward to having you on a future event. Thanks again Andy. Thanks Nicole. All you guys are awesome.

Nicole Reich 55:39

Thanks everyone. Have a good day!

Aaron Conant 55:42

Take care everybody.