Lunch With Norm
Posts
[LWN] 😔 I Lost $100 000 and a Friendship...

[LWN] 😔 I Lost $100 000 and a Friendship...

Lunch With Norm's Weekly Newsletter - History of Amazon Fees, Chat GPT 4o, and More!

May 21, 2024 • Estimated Read Time: 12 minutes

😔 I Lost $100 000 and a Friendship…

I saved a friend’s business while he was at his lowest… and then he left me in the dust.

What you’ll find in this week’s newsletter:

😔 I lost $100 000 and a Friendship… [True Story]
🗞️ This Week’s Amazon News & Updates
✅ The Full History of Amazon Fees
🎙️ What You Missed Last Week
💀 Are Keywords Dead?
🌎 Upcoming Amazon Seller Events

Hey Beardos! I know, this week’s newsletter was a little late. You know the drill… Blame Kelsey. I’m currently travelling in Hawaii. Pictures will be coming shortly. Aloha, and see you next Monday 🤙

😔 I Lost $100 000 and a Friendship… [True Story]

I used to work with a contractor.

It quickly turned into a great friendship.. But things went sour.

It all started when I offered him a hand selling his tech stuff online.

We worked together for about a year and a half. We even did some traveling together.

We became pretty good friends.

One day he called me.

You could tell he wasn't himself.

We met at a bar, where he broke down.

He told me his story about going under, having no credit, and bankruptcy looming in the future.

He was on the verge of saving the company, but he couldn't bring the company back without credit.

So, we talked about him working with me.

I'd help him pay down these debts, about a hundred grand, and he'd come on as part of the company and we’d open up a print division.

He was very grateful.

We became best buddies for the next year… until a better offer came around.

I remember him coming over my house.

He said, "You've been really awesome, but..."

Uh oh.

He said a travel agency had offered him a large print job worth $500,000.

He decided to team up with them and do something independently.

I was shocked.

I said, "Are you joking? I just gave you a hundred thousand bucks a year ago to help you and your family out, and you're doing this to me now? The second we start to get profitable!?"

He left, leaving me hanging. I was stuck with all the leftover orders.

One thing I've learned in business, you can tell a person's personality sheerly when greed and fear come into play.

That’s where you see their true personality.

They could be nicest person in the world but as soon as something like that happens, their defences go up, and they try to protect themselves.

That's what happened with this guy.

It absolutely shocked me.

Enjoy the rest of the newsletter.

— Norm

Would you loan a friend a significant amount of money?

🗞️ AMAZON NEWS & UPDATES 🗞️

What’s happening in the world of Amazon today…

🚨 Updates to the Return Insights Dashboard and Returns Processing Fee Reminder - Read More
💰 US Sharply Hikes US Tariffs on an Array of Chinese Imports - Read More
🤖 The Latest AI Update…Chat GPT 4o is Now Out! - Read More
📈 With Rising Fees, Amazon Sellers Are Rethinking Their Prime Day Discounts - Read More
🔥 ‘This Why I Can’t Find My Celtic Salt in Store?’: Viewers Are Outraged After Woman Brags About Making $20K in Profit By Reselling Salt - Read More

WHERE IN THE WORLD IS THE BEARDED GUY?

Can you find Norm in the picture below? Scroll to the bottom of this newsletter to see the answer!

💰 The History of Amazon FBA Fees

Courtesy of Smart Scout

To attract third party sellers, Amazon FBA started out with low fulfillment fees. Amazon's FBA fees and program have changed considerably over the previous decade.

The FBA fees for standard size products have increased 96%.

The FBA fees for oversized products have increased 74%.

The removal fees have increased 460%.

Below is a summary of each yearly change with additional context to major program changes that occurred that year.

Check out the full history from Smart Scout here!

WHAT YOU MISSED LAST WEEK

👇 Highlights from last week’s Lunch With Norm podcast episodes👇

Breaking Through The $20k/Month Revenue Plateau

Watch the full episode here

Main Takeaways:

Understanding the $20k Revenue Plateau:
- Many e-commerce businesses hit a revenue plateau early in their growth phase. Breaking through this requires strategic ad spending and optimization.
Mindset Shift for Scaling:
- Prepare to increase your ad budget significantly when necessary, viewing it as an investment rather than a cost.
Integrating Email Marketing:
- Develop a robust email marketing strategy to complement your ad spend, enhancing customer retention and repeat sales.
Optimize Ad Creatives:
- Continuously test and optimize ad creatives to maintain or improve return on ad spend (ROAS).

AI Wednesday - Chat GPT 4o: The Latest Update in the AI World

Watch the full episode here

Main Takeaways:

A Major Advancement Just Happened:
- Chat GPT 4o was released last week and it’s FREE! It’s the new improved version of 4. This version even has voice-to-voice recognition. Think of the movie “Her” with Scarlett Johansen. Fiction is becoming reality…
Enhanced Interaction Speed:
- The response time for Chat GPT 4o is now 300 milliseconds, making interactions faster and more seamless, almost instant compared to previous versions.
Live Video and Screen Sharing:
- ChatGPT 4o can analyze live video feeds and screen shares, allowing real-time assistance and interpretation of visual data.

Marketing Misfits - What’s New with Amazon?!

Watch the full episode here

Main Takeaways:

Innovate Based on Customer Feedback:
- Read customer reviews and feedback to identify common pain points and innovate your product offerings to address these issues effectively.
Utilize Unique Packaging and Branding:
- Invest in premium packaging and branding to create a high-quality perception of your products and attract discerning customers.
Podcasting as a Marketing Tool:
- Build authority, and an engaging community, by sharing knowledge in an informal and conversational style podcast.

THREE UPCOMING PODCASTS

You can watch all episodes on YouTube or on my Facebook page at 12 pm ET on Monday, Wednesday, and Friday!

**Guests and topics are subject to change**

Monday - How to Audit Your Amazon PPC like a Pro

Noemi Bolojan - Founder of Scale Wave
Driven by a need to support her brand in 2020, she mastered Amazon Advertising through extensive self-study
Former co-host with Carlos Alvarez on the "Wizards of Ecom" podcast

Watch LIVE 👉 Sign up here

Wednesday - Amazon Seller Strategies: Fees, Programs & Profits

Rebecca Thomas- Head Growth Officer of Execuseller
VP of Operations at Upper Echelon Products
Her strategic vision and deep understanding of Amazon's seller ecosystem empower entrepreneurs and businesses to thrive in the competitive landscape of 2024.

Watch LIVE 👉 Sign up here

Friday - The Effect of the New Amazon Fees on the Ecom Ecosystem

Aaron Biner - Founder of Marketplace Nerd
His sales total last year was 1.7MM and looking to push past 3MM in 2024
Current member and contributor to Million Dollar Sellers (MDS) and Seller Systems Inner Circle.
Watch LIVE 👉 Sign up here

Are Keywords Dead?

Courtesy of Max Sinclair from Ecomtent

The “Context vs Keywords” COSMO Debate

Spending the weekend at Seller Sessions '24 brought a debate raging throughout the Amazon world into real life and in person – are keywords dead?

Almost every speaker, including former Amazon employees and 8/9 figure sellers referenced RUFUS (Amazon’s new AI “shopping assistant” that operates like Chat GPT from within the search bar) or COSMO (Amazon’s “Common Sense” algorithm).

On the two latest episodes of the New Frontier Podcasts – Bradley Sutton from Helium 10 and Vanessa Hung of Online Seller Solutions we heard perspectives from both sides of this debate, and in this blog I will offer my take.

To be upfront, much like Nicola Sturgeon of the Scottish National Party I am incredibly biased towards ‘Yes’ (I accept non-UK based readers will not appreciate that reference).

The Logical Case For Yes…

The case for yes is a technical yet simple one. If you believe that AI powered search is the future rather than traditional search, either by customers directly using RUFUS, or by Amazon over time putting more emphasis on COSMO logic in the backend rather than A9, than context is inarguably more important than keywords.

This is because LLMs do not operate in words. LLMs break down input text into a sequence of tokens, which can be individual characters, words, or subword units (like "un" and "likely").

Each token is mapped to a numeric value for processing. The model then processes this sequence of numeric token values to generate its output, token by token. This token-based approach allows LLMs to handle a vast vocabulary, generate coherent text in multiple languages, and understand rare words or phrases not seen during its training.

What's more, before generation, most LLMs will compress the original prompt to reduce the overall model sizes, computational costs and fit within token windows.

Prompt compression techniques remove non-essential tokens from prompts using a smaller language model.

This compressed prompt, while difficult for humans to understand, can still be effectively processed by the LLM to generate relevant outputs. So post compression, so-called "longtail keywords" sellers are trying to rank for will likely not even make it past step 1 of the COSMOS workflow diagram below.