Warwick lead Amazon renewed in Europe before moving on to managing the UK's largest distributor of renewed Microsoft and Intel devices on the marketplace.
Listen on Apple.
In this episode we discuss:
[0:00:01] George Reid: Welcome to us Always Day One. My name is George Reid, a former Amazonian turned amazon consultant. Each week on the podcast you're going to hear industry experts, brand owners and amazon employees share their answers to the basic yet fundamental questions you should be asking yourself about your amazon business now, let's jump in. Hello ladies and gentlemen, welcome to another episode of It's always Day one Today I've got an old friend and colleague Warrick Massoud coming to speak to us about the topic of refurbished amazon refurbished, all things refurbished and a number of different bits and bobs. Warrick introduce yourself mate, give us a bit of a background.
[0:00:39] Warwick Massey: Hi George. Thanks so much. It's a pleasure to be here. So as you said, I'm work old colleagues. I worked at amazon for four years, initially in the UK marketplace as account manager and then throughout my tenure with amazon uh held roles within the amazon refurbished, which is amazon renewed now everything from just leading the UK marketplace through two leading european business development. And then finally, I owned the, the retail business and the business development as well as the EU new marketplace business.
[0:01:12] George Reid: That's a lovely title to finish on, We discussed that before. Kind of leading up amazon renewed um, in europe, what what exactly does that look like for those who are not familiar? What is amazon renewed?
[0:01:27] Warwick Massey: Sure, it's amazons, effectively, it's amazon's approach to addressing the customer need for refurbished products. So this is a more price sensitive consumer. Um, it typically is a business that doesn't fit well next to new because of the cannibalization effect of new business. Uh, and it's also one of amazon's ways to push towards this climate pledge and to develop and foster a green brand if you like
[0:01:56] George Reid: and overall, you know what I've seen in the last few months, intrigued to hear your thoughts on this, you've said that climate friendly pledged piece and we're seeing that now, I don't know how upstate you are in the amazon detail pages, but brands who are following the guidelines are gearing to such climate friendly recommendations. They're getting this climate friendly pledge banner module, whatever you want to call it. Was that implemented with me? You were there because I've only seen in the last six months or so.
[0:02:30] Warwick Massey: It certainly wasn't. So for reference since, since I left amazon in february 2020 I've held roles as a director of the U. K. Refurbish er for Microsoft um and into devices. Um and I'm now leading merchant services that reefer, which is one of the fastest refurbished marketplaces in europe, so certainly have been out of the amazon game for for a good 12, 18 months, moving towards 18 months now. Um For sure, that wasn't an aspect. But what is very clear to me is that packaging in general is a good area for sellers for brand owners to start pushing their green message to consumers right as default Now, a consumer expects recycling friendly packaging, Right? So they gone are the days where you get, uh, a simple plastic bag with within a plastic bag and then you're expected to just throw that away. Customers don't like that. The same with cardboard, Right? If you are a brand that is pushing all of the green benefits of your brand and then you're dispassion product in cardboard that is difficult to recycle is not easily recyclable for the consumer. Um, then you're really mixed messaging that consumer and they're confused and they're not happy at all.
[0:03:54] George Reid: I guess it doesn't really align with your your values. So you're portraying a message on your detail pages, your a plus that you care massively about the environment that you're always looking to give back. You're creating a sustainable future in order that sort of jazz and then you delivering it with packaging that doesn't mimic it. Like you said, it creates that confusion, that messaging isn't aligned, and I guess that comes down to just creating a poor customer experience. I talk a lot about invoking an emotion and obviously you want that to be a positive one. But what you've touched upon there is, if you're not aligned, that is create some sort of negative emotion, would you say?
[0:04:38] Warwick Massey: Absolutely. One thing that we're seeing it refurbed is the rise of the environmentally conscious consumer, right. The sustainability factor. Previously, even within the refurbished space price has been number one, right. I just want to buy a product that is low priced. But increasingly, we're seeing this demand from the customer that's saying, hey, actually I want to buy refurbished or I want to buy my product and have great recyclable packaging or packaging that allows me to do something else with it other than throw it in the bin and have it seen ending up on land in landfill. Um, and that's, that's going from, from a very low reason for purchase. And it's that, that's now for us referred that's within the top five reasons. Different geography for a consumer to buy with us.
[0:05:29] George Reid: So you've such one there with refer products, obviously one of the benefits as you're paying a lower price given your experience, obviously at amazon and sense it's still the number one driver. So you, you're, we discussed this before you started chatting, um recording, I should say about, you're, you're able to target almost two types of consumers in the category. And if you are in that hard lines category, which I believe you said was more suitable for refurbed products and perhaps you're the higher price point. You don't want to price out those lower and people you can still attract them with a refurbed solution. Um So is it just is pricing still number one by a considerable way or people actually going, you know what, it's not just the price. I'm, you know, I'm doing well in life, I've got some nice cash coming in. I could buy the do what if I want, but what I prefer to do is go and buy a re for up to on or even second hand, what might say
[0:06:30] Warwick Massey: for sure. Um if I look at what's important to consumers trust is also a big one. Right? So actually, when you look at the overall refurbished market, yes, you have those propositions which are, I'm going to buy a used device secondhand, let's say iphone and I just want the cheapest possible iphone for my child. And that will be good enough. I don't care if it's scratched bumped, et cetera. But actually, the development of the refurbished market in recent years, certainly the past 5 to 10 years has movement towards this consumer education piece. So educating consumers that there is more than just refurbished or second, the secondary market is more than just a dirty old iphone or a dirty old laptop that's been that's come out of somebody's draw or has been used. Now, if you look a lot of the lot of the the big market places in europe and big retailers in europe, what they're offering is a product that is as good as new and it comes with a 20, discount in you. And so actually consumers are waking up and realizing well why wouldn't I buy a product that looks and works exactly like a new device? Yes, it might be 1 to 2 years older, but that's that's perfectly okay with me and I'm saving tons of cash and it comes with a warranty in most cases
[0:07:55] George Reid: and when we think about amazon obviously we're able to still get them conversions because the trust is there so that demand clearly exists. People want to buy things at a discount, particularly amazon customers, you can argue there. Their messaging from amazon is continuously kind of wide selection, best prices. And this favours that if we think about touched on it a minute ago, kind of hard lines being core category, what are some of the other categories? You know that people can go, you know what refurbed is suitable for me and what are the reasons would encourage them to get involved in it? Because I'm sure from your time at amazon you were having lots of conversations converting people to look and explore the refurbed option. So what were some of them reasons you were using when you were? I'm not going to call it a sales pitch but when you were speaking on the phone to these, sell its or brands
[0:08:50] Warwick Massey: for sure. So uh I think that there are two parts of that question right first and foremost, is it just hard lines that the refurbished works for? Yes and no really um if you if you look at the process of refurbishment we attach it to physical hardline products, often in the consumer electronics space, but actually we're talking about the secondary market here which is any product that is sold and then could potentially be resold or buffed up, cleaned up, repackaged. Um And so there is a much broader scope here. Um That being said the second part of your question, how can you pitch this? How how how could how did I tell some of the world's largest brands and distributor's that they should be interested in. This will simply I think there are tons of different benefits to brand owners to to distributors. If you look at the financials, so doing something with your returns, reworking them and reselling them gives you an opportunity to recover a significant portion of that value of that product, right? And so if you are if you have a cost price of let's say в‚¬50 and you are retailing at в‚¬100 provided you could refurbish that product to a like new state, you could probably get up to 80% of that value by selling that a major market place like refurbed like amazon renewed. And so suddenly you compare that versus I'm going to pay e. G amazon в‚¬10 for that product to throw it away or to recycle it or to bundle it up at auction. Um And and the numbers are just crazy different. So uh from a financial standpoint refurbishment makes total sense often. However it does require additional cost, right? It requires you to to input processes and teams to manage that. If you're a premium brand refurbishment actually allows you to achieve a lower price point without significantly disrupting the new market. So if I'm looking for a place e. G. European brand or US brand and we know that there are a lot of within a lot of verticals within the consumer electronics space, particularly amazon. There are a lot of chinese brands that are coming in at a lower price point in order to attract that very price sensitive consumer. Well if I'm if I'm that that larger brand I can either drop my price which I'm not willing to do or I can develop a refurbished proposition. I can stop that cost that we just talked about by paying it to the retailer to destroy the product. And actually I can give consumers that would not have been willing to pay the extra in order to buy my product in new a chance to experience what a premium product feels like. And once they've had that experience, if I have an ecosystem with let's say I have an app to support the product. So let's say it's an audio product um then there are my ecosystem. They can see all the benefits they get that they wouldn't have with this cheaper equivalent. And ultimately then you open the door to a complete Upsell. So hey this customer, you now try to E. G Sony product and guess what? You can buy the brand new one when you when you when you want to upgrade that product or whether you're when you want to give that to a family member and by the new version and maybe they buy it on deal um maybe they
[0:12:20] George Reid: don't. Hey folks, is George here. I'd like you to check out my new site georges dot blog. It's where you can find all of my famous weekly emails as well as how we can work together to repeat. That's George's dot blog. Now let's carry on with the episode. I love that point there. Sorry to interject, but I really like it because one of the big questions I've asked in the last 50 or so episodes
[0:12:48] Warwick Massey: is what
[0:12:49] George Reid: do people feel is the biggest threat to a brand selling on amazon? A lot of the answers are either amazon themselves or or chinese manufacturers and sellers coming on. So as hardline seller who probably fears chinese brands the most, this is a great way to still protect your brand and and offer an alternative to that are price sensitive consumer and I love the way that you're you're kind of hooking them into your ecosystem as well there and thinking I'm getting someone to adopt me and my brand and our brand and our values and bringing them in um and making that product part of their their life and whether that means that they make a shift from X. Y. Zed, you know, apple headphones to refurbish Samsung wants or it's a brand and that then gets them into the mood. They like how they work, like how the customer service works. They like the app, they like, whatever it's still introduces them and their group to the brand. Um, and it still drives reviews. Like if I pivot across the, just thinking about the knock on effect here with furbish products, this is more of a technical question. Do you still get the same reviews either reviewed equally, the review share between the refurbished and the number of furbish to sign or not
[0:14:14] Warwick Massey: specific to amazon. It's a separate, so completely separate. A sin. You will create the way that you create a refurbished assassin or a renewed assassin is by copying the new one effectively, there is a tall in the back end and you say, hey, I'd like to make, this is my product and this is what I'd like to now make it a refurbished product and so it copies the content but it doesn't copy the reviews. We didn't at least last time I was there. But one thing that we should touch on here on this type of it's super relevant is that actually if you if you think that you have a catalog hundreds of use and then you make all of those skews refurbished, suddenly you've doubled your footprint on amazon. And so when you're thinking about and you can use different keywords, you can use different, you're talking in a different and inherently different type of customer. So you can use different sponsored products or advertising campaigns to track that customer. And then once you are with that customer, you then obviously have a chance to either convert them if they are willing to convert on a refurbished offer or you can drive them to your new product. And so if you consider the refurbished proposition as more. Also more than just a way to recover more value away to actually develop that messaging for the consumer which we didn't talk about with this environmental piece. Right? We're seeing crazy numbers of of products that being destroyed of E waste. I think last I read I think the 2019 E waste report by the U. N. So it's something like 50 just over 50 million metric tons of E waste was produced in 2019. So if we can start to use refurbished as a way to a double your footprint be help you financially as a brand but also dr this sustainable side of consumerism then we as a community and society will also benefit.
[0:16:15] George Reid: Yeah I I love a lot of what you said that I'm going to go back to a previous point you made just about doubling that footprint. I think it's a really cute way of looking at it. You know, some of the most successful sellers on amazon. We understand this from our days where we would encourage people to add more inventory because we knew there was a knock on effect to additional inventory. Additional products helps drive that fly Will people are discovering you and your brand more so all products perform better. So argument's sake you have one top seller, if you add nine more products and they don't necessarily do much revenue, that top sellable still increase its sales because of those nine typically. So if you can double it like that. And in theory, once you put the operations down, you're not having to invest any more in content to any of them expensive pieces, A lot of the advertising can be in some way duplicated, but then amended slightly with some of the wording that you're using or creators that you're using in the budget that you're using. But again, you're you're reaching out to different types of customers um Which is another brilliant point. You're able to go, maybe our refurbished product attracts the click because the price point And it gets them in the door and then when they're clicking through to the store, they decide to actually just go for the full price one because it's 20% more and they like new stuff. And that could work on the flip as well. They could click on the high price swan and go, it's a little bit of my range actually, who am I kidding? I'm looking at the store now though. Or when you're gonna tell me this in a minute, there's an option where you can click to the refurbished option there and you're cross selling them if maybe a little bit too expensive, you're kind of posing the problem in their own head, You're providing the solution. How does that, how does that look on amazon? Could you explain this to the day and you explained it much better than I could?
[0:18:12] Warwick Massey: Sure. So, uh, you have to check obviously depend on marketplace and depending on there are a number of factors that that it depends on. But for sure there are on a, on a lot of refurbished products. There is a standalone widget if you like that that sits above the fold but beneath the sort of about section towards the right hand side of the page. And it just tells you how much you would save by buying refurbished or spend X euros or X dollars more to buy it in new. Right. And so this is this is a placement that is stuck based on your on the assassins that were used in this creation process. Almost sort of like a mapping process. And so nobody is taking that away from you in terms of competitors in terms of um, amazon retail, this is this is stuck on an ace in level. Um, and it's it's super powerful and and in my opinion, um it's still today very under used
[0:19:11] George Reid: because I like the point you were making as well the other day was it forces the the top of the page above the fold to be a bit thicker and deeper almost. It nudges that product targeting placement down beneath beneath the fold. So for those who are a little bit confused, I'm listing you have the option to put a product targeting at on a competitor, but and that will appear beneath the bullet points. This widget that warrant Warrick's talking about sits beneath those bullet points, isn't it? And therefore nudges or removes the product placement opportunities. So therefore it's a great defensive technique as well and it's free. You don't need to bid on your own listing to play defensive here. You can create a, um, a refurbished option or renewed option. And boom, you're then removing some of that competition without having to bid. Um, so such a brilliant solution
[0:20:14] Warwick Massey: and I would also add something that we've not touched on and it's all good and well talking about within amazon and for sure this is extremely powerful. Um, but a lot of, particularly in, particularly brand owners Are very concerned about cannibalization of new sales. Right? So they're concerned that, Okay, great, this is lovely. I'm going to list my refurbished products. But what happens if 30% of the sales that would have been new end up in refurbished suddenly you're into, you're cutting into my margins. I think this is where refurbed as a marketplace. So for reference reverbs Is a marketplace. It's the same kind of model as Amazon 3P where you as a seller only inventory and sell to consumers. The difference is referred, this only full refurbished product and so the benefit you have of overall challenge. Channel management is you can do refurbished, you can have that refurbished product. All of the benefits of refurbished, I think you should list on amazon to take advantage of that visibility and traffic we just touched but you're not isolated to amazon. You have marketplaces like refurb that have the volume have the right customers and also are able to give you as a reseller as a brand owner. A almost tick of Okay, this is this is somebody that is sustainable. This is somebody that is not just greenwashing or messing around. They are a genuine authorized merchant on this particular platform. Um, and so actually it's a much broader conversation to be had and you can bet your bottom dollar that customers are researching. We know that for a fact customers when they're buying a refurbished product because trust is such a big part of the whole purchasing process, right? They don't want to be that person that bought a used dirty iphone that I mentioned the beginning from Ebay or it never arrived or they brought from facebook marketplace. But the experience was terrible because the phone died two days later. And so they research and in that researching process for sure, they're going to check reviews and they're going to check what's your, what's your branding, like, what, what do you stand for as a, as a brand owner and how can I tie into that? How can I feel warm and fuzzy about buying your product versus your competitor?
[0:22:34] George Reid: I like your point as well because it's, it's diversifying them income streams. We know that the challenge and threat with amazon as you can. If you're a naughty boy, get a slap on the wrist and maybe get banned or blocked an amazon if you're over reliant on one channel, whether that can be for sales traffic or whatever, you suddenly have a single point of failure. So when that falls through your a bit buggered utilizing, I guess something like refurbed or insert other, um, allows you to create that second flow of traffic, that second flow of revenue in a trusted place as well. Um, plus if you're concerned about, because many brands may feel this, we don't want to create a lower priced item just full stop, We think it will devalue us. So removing that from amazon and putting it on on a specific marketplace will do the job. And with those specific marketplaces, you're likely to attract people who are more interested in refurbed as opposed to those who are more interested in new products. So you're kind of also attacking the new customer base as well. Attacking is not the nicest word that seems to fit in this case
[0:23:51] Warwick Massey: for sure. Absolutely.
[0:23:54] George Reid: So the final piece I wanted to natural on, just briefly before we went at a time would be on the packaging. On the packaging point. I know this is something you're quite passionate about when it comes to communicating your values. We can communicate it just from the way we package our products, right? And whether that's what it comes in or whatever, that's another touch point that we can utilize. Is there any little things from refurbed, for instance, how are most people approaching packaging, given that they're selling primarily now on a on a refurb the marketplace? What are they doing with their packaging? What's better, what tips can you quickly share with people?
[0:24:38] Warwick Massey: Absolutely. I think, look, it said at the beginning, long gone are the days where you've got a bag within a bag, Right? And mr, consumer throw away. So some of the things that we've seen within refurbished as a sort of general rule of thumb, you can use a brown, just a standard brown recyclable box. Right? Often the new packaging is damaged. It's also essentially one of the reasons why the product is available as refurbished anyway. Um, but if you start to think about how can you add value to your brand? We've seen stuff like you can add small seeds inside the packaging, so inside the box and you have to water that, or take the, take the seeds off, put them on top of a a a pad to be able to grow those, and you can actually grow flowers from the packaging. We've also seen packaging used in a way that, okay, so you have recycling, this is recyclable, this is, you could do this with the packaging, but also tons of different uses. So suggestion, hey, instead of throwing this box away, why don't you keep it and store things in it or why don't you use it to make this or to paint pictures with your Children? So just getting that creativity going, turning what is just a standard old box into something that can be much more. And of course, including your branding on the inside of that packaging. If you think about when you buy a new product, I think I know you've talked about this a lot before George and obviously it's a big, big segment on your, on your website, but actually invoking an emotion when that customer first opened your product and sees your product, if you're going to give them something like, hey, a refurbished product, this is a, this is a price conscious product for a price conscious consumer, if you can then add something in there to make them say, wow, suddenly it's just, it's much more than that. Oh, I bought this because it was cheaper and I think that can be super powerful for brand owners.
[0:26:43] George Reid: Yeah, I actually love some of those little ideas and there's some great little tips. It could even kind of be sketching something, you could have a sketched out tree or something like that already on the inside of the box. And it encourages an activity for people to be able to paint it in with their kids, something one of those lines and again, for me, like you said there use this box for this, encourage them to keep the box, get a second use out of it, which should tie in nicely to those who are more conscious. And it also keeps you as your brand front of mind. And I've said this time and time again, the example with the antler box I've got, it's now just got in a bit after a year and a half because it was a bit buggered, but a year and a half I saw it on a weekly basis whenever I went into the garage, stay in front of mine. So that creative piece is fantastic Warrick, you've been an absolute champion, so much value there, I'm really looking forward to sharing with people. Hey, thanks so much for your time. It's been great.
[0:27:40] Warwick Massey: Thank you very much. It's a pleasure.
[0:27:43] George Reid: ВЈ16
[0:27:44] Warwick Massey: cheers. Thanks for my
[0:27:46] George Reid: Hey guys, just a quick one. If you are enjoying the podcast, I either have some actionable next steps or new ideas. I'd really appreciate if you could one subscribe to the show and leave us review. These are really, really important to us, as you probably know, being in the amazon world and two. If you're looking for additional support with your brand, head over to the website, it's always day one dot co dot UK where we've got links to other resources as often our guys speak soon.
🙋 ➝ Get help managing Amazon Advertising
📝 ➝ Subscribe to our newsletters