ZQ Magazine - Issue 02 / February 2022 by ZQUARED

Table of

Contents Our Brands Brand Spotlight: Crossrope

Brand Highlights

Informational Resources Amazon Increases Prime Membership Fees

Parent/Child Relationships and Variations

Choosing the Right Product Category

ZQ Community

ZQ 101

Charlie’s Corner

Join Our Team

Get in Touch

ISSUE 02

A letter from the CEO At ZQUARED, our number one priority has always been, and will always be, people. From our Brand Partners and vendors to our employees and the communities in which we live and work, people are at the core of who we are and what we do. This year, we have made a commitment to invest more time, energy and resources than ever before into cultivating deeper relationships. We are eager for the opportunity to make in-person connections with our Brand Partners, in St. Louis and beyond, to further develop rapport. We are also excited about increasing our involvement in our local community to make an impact in new ways. Stay tuned for more news on this front in the coming months. I am truly grateful for, and encouraged by, the people and partnerships who are ZQUARED!

Zach Cornett

Co-Founder & CEO, ZQUARED

ISSUE 02

Our

Brands 5

Brand

Spotlight CHALLENGE Crossrope offered products on Amazon but was unfamiliar with Prime, FBA and how to create a merchant storefront. They didn’t have the time or energy to remove experts in the Amazon field, and were looking for a partner who could handle the entire process. “ZQUARED’s Inc. 5000 Award is a testament to a fast-moving company and forward-thinking mentality.

PLAN The ZQUARED team developed a cohesive approach for Amazon management to achieve the goals of increased revenue and sales rank. Tactics for achieving these goals included listing optimization, advertising strategies and reseller control. “Not having to worry about being AMZ experts is so nice and such a relief. We can focus on growing other aspects of our business.”

– Crossrope ZQUARED brought their expertise, trustworthiness and reliability to the table. The all-in-one solution ZQUARED presented far outweighed the benefits of attempting to manage Amazon on their own.

As Amazon became increasingly complex, Crossrope knew they needed help to build business within the channel.

ISSUE 02

EXECUTION For Crossrope, ZQUARED offers unmatched value for comprehensive, expert Amazon service. The all-in-one approach of selling product directly to ZQUARED in exchange for complete channel management is a unique business model that makes selling on Amazon as easy as possible. Crossrope is 100% content in their decision to sell product on Amazon exclusively through ZQUARED; there is no reason to have multiple resellers on their listings, as doing so muddies the channel. The brand also uses ZQUARED’s proprietary reporting dashboard, Snapshot to check numbers daily and stay in tune with channel updates.

RESULTS Crossrope has experienced tremendous growth since partnering with ZQUARED. When they initially reached out in 2015, their Amazon sales were less than 100 units per month on average. By 2020, they had realized an increase of 116% in year-overyear sales, averaging more than 2,500 units per month. Today, ZQUARED continues to support Crossrope’s strong sales numbers and defends their value through strategic advertising campaigns.

“Working with ZQUARED is like pushing the Easy Button” – Crossrope

dedication + communication = mutually beneficial partnership

ZQUARED handles everything with trustworthiness and credibility. They are an integral part of our business model.

– CROSSROPE 7

Brand Highlights For the month of February, we’re highlighting Trudell Medical, MacroLife Naturals, Diem Labs and Fitterfirst. We’re honored to be a part of the journey alongside these incredible brands.

Year Founded: 1922 Category: Pet & Animal Health

FUN FACT Trudell products are marketed in over 110 countries worldwide, and their efficacy is supported by more than 300 peer-reviewed publications in various medical journals.

FUN FACT Year Founded: 1997 Category: Health & Wellness

MacroLife Naturals products have received more than 15 awards, including accolades from Vegan Health & Fitness Magazine, Whole Foods Market and American Masters of Taste.

ISSUE 02

Year Founded: 2016 Category: Health & Wellness

Year Founded: 1985 Category: Health & Wellness

FUN FACT Fun Fact: In 2016, Diem became the first U.S. company to actively raise awareness of Histamine Intolerance while offering an exclusive, effective solution.

FUN FACT Founder Louis Stack and his wife Margaret run their family-owned company in Canada, where they design and manufacture many of their products in-house.

ISSUE 02

Informational

Resources 11

AMAZON News

Amazon Increases Prime Membership Fees On February 3, 2022, Amazon announced that the company will increase the annual price of Prime membership in the U.S. from $119 to $139 – representing a 17% increase. This price hike is the first to hit since 2018 and is meant to offset inflation, rising wages and transportation costs. Annual membership prices are rising across the board. Updated pricing will go into effect for Prime member sign-ups on February 18, 2022, and will apply to current Prime members after March 25, 2022, on the date of their next renewal. The price of Prime monthly membership is increasing from $12.99 to $14.99, and the price for Prime Students will increase to $7.49/month, with the price of the annual membership increasing to $69/year. Memberships for qualifying EBT and government assistance recipients will increase to $6.99/month. In addition to Prime membership fee increases, Amazon also announced increased Fulfillment by Amazon (FBA) fees for third-party sellers at the end of 2021. Across the board, Amazon is likely facing elevated costs of business as the company reported a massive increase in Amazon sellers, which pushed their storage and fulfillment capabilities to new limits. Navigating supply chain constraints caused by the COVID-19 pandemic continues to prove challenging as well.

ISSUE 02

Even with significant price increases, Amazon is likely to continue to have high customer retention rates, as society has become accustomed to (and now demands) convenience and instant gratification – two important needs that Amazon fulfills for its customers through its platform simplicity and free 2-day shipping. When combined with the other benefits attributed to Prime membership, such as Prime Video, Amazon Music, Prime Day, Prime Exclusive Deals and much more, Amazon has become a staple service for many American households.

THE ZQUARED ADVANTAGE With customers paying more for annual Amazon Prime memberships, they will rightfully require a seamless purchasing experience, in-stock products available through Prime shipping and reliable 2-day delivery.

ABOUT

Since program inception 17 years ago, Amazon Prime membership has only seen three price increases, but they have now become a customary event at four-year intervals. Initially the program was priced at $79/year in 2005 and then saw rate increases in 2014 ($99/year), 2018 ($119/year) and 2022 ($139/year).

ZQUARED provides our Brand Partners with end-to-end solutions that focus on growing through advanced brand optimization and marketing techniques, strategy execution, proprietary technology, forecasting tools, logistical support, product distribution and more. Our teams work to ensure a seamless customer experience that drives our partners’ revenue, while simplifying their business processes. To learn more about how ZQUARED can help you stay ahead of Amazon’s ever-changing rules, contact us via zquared.com/contact

Parent/Child Relationships and Variations Products sold on Amazon that have different sizes, colors, flavors, and other traits are typically referred to as “variation” or “parent-child relationship” product listings. These products are related to each other and allow customers to compare and choose products based on their different attributes – all on a single product page. What Is an Amazon ASIN? An Amazon Standard Identification Number (ASIN) is a 10-character, alphanumeric code that identifies Amazon products. Each product that is listed for sale on Amazon receives this unique identifier and allows customers to easily identify the product they are searching for. It is important to note that no two items will have the same ASIN and that ASIN identifiers are specific to Amazon’s marketplace. Note: Books are classified using ISBN, which is the same as ASIN. What Are Product Variations (Parent-Child Relationship Listings)? As defined by Amazon’s Seller Central: “Variations (also known as parent-child relationships) are sets of products that are related to one another in terms of Size, Color, Flavor, etc. Good variation relationship listings allow buyers to compare and choose products based on different attributes such as size, color or other characteristics from the available options on a single product detail page.” A seller can view their existing child ASINs for parent ASINs in the Amazon catalog on the “Add a Product” page in Seller Central. If the product is not in the Amazon catalog, the seller will need to create a new ASIN.

The Difference Between Parent ASINs and Child (Variant) ASINs A parent listing is a non-buyable entity that is used to relate to child (variant) products. Parent listings are given a unique ASIN that is used to identify the product grouping, but the listing is only displayed within the brand owner’s Seller Central search results. A child listing is a product that is related to the parent listing. A parent listing can have multiple child listings that are all related, but each child listing will vary in some manner (size, color, flavor, etc.).

ISSUE 02

Example of a Parent-Child Product Listing Per Amazon: “A customer searching for a short-sleeved t-shirt might click on a product detail page for a t-shirt that comes in three sizes (Small, Medium, Large), and three colors (Blue, Red, Black). Rather than having to browse separate pages for each color and size, the customer can select the preferred size, and choose the color from the three available color variations on the same page.” Best Practices for Creating Parent-Child Listings

1. Do Not List Different Products Together Though some products have related items that enhance their functionality or customer experience, items related to the parent-child listings cannot be listed on the same product detail page. Though related, these products are different from the parent listing and therefore require unique ASINs. 2. Use Variation Themes for Their Defined Purpose Make sure to use variation themes for their intended purpose so that customers receive clear, concise product information. These fields have defined purposes, such as color and size, and should not include additional information. 3. Properly Describe Child Product Listings Each child product listing should be described in extensive detail – detail that is defined across all child product listings to ensure brand and product consistency. Not only does this detail make comparing product variations easier for customers, but it may also help to establish brand voice and customer brand recognition. 4. Do Not Introduce Large Variation Families Variation families with more than 2,000 child ASINs will not be displayed on the detail page, so be cognizant of how many parent-child variations are being established. 5. Do Not List “Hard Bundles” A “hard bundle” occurs when one ASIN

includes multiple components, but the components are not individually available for sale on Amazon and don’t have their own product detail page/s. A perfect example of this setup is a camera set that includes a camera with multiple lenses and attachment pieces. If the lenses and attachment pieces are not individually available for sale on Amazon and don’t have their own product detail pages, the camera with these accessories would be considered a “hard bundle”. Always Remember Amazon’s Strict Product Listing Rules Creating listings can be difficult, confusing, and downright frustrating. Amazon has their rules spread out across multiple areas, but three of the most important areas on which to focus are listed below. As a general rule of thumb, Amazon’s category rules for products are superior to their general rules.

AMAZON LISTING STYLE GUIDE POLICIES FOR WRITING LISTINGS CATEGORY STYLE GUIDE To learn more about how ZQUARED can help you stay ahead of Amazon’s ever-changing rules, contact us via zquared.com/contact 15

Choosing the Right Product Category Similarly to Google search results, customers on Amazon are more likely to view products listed on page one of their search results. For this reason, ensuring a high level of discoverability and product ranking is key to remaining competitive on Amazon – especially at a time when there are more sellers on Amazon than ever before.

What Are Product Categories on Amazon? Amazon’s overarching goal is to provide customers with a positive, comprehensive experience that bolsters their purchasing confidence. To achieve this goal, each product listed on Amazon is defined by their attributes (product name, manufacturer, product traits, etc.) and is placed into an appropriate category and subcategory. Choosing the right product category and browsing tree is imperative to enhancing discoverability and product ranking because it directly affects keyword optimization used within the title, bullets and description of the product listing. Amazon refers to product categories, and subsequent levels of subcategories, as the “Browsing Tree Guide (BTG)”. Categories and subcategories allow sellers to list their products in the product areas that are most relevant to their offering, while also allowing customers to optimize their search results for the products they are looking to purchase.

How the Browsing Tree Guide (BTG) Helps Optimize Product Listings Amazon’s BTG enables customers to find products through search and browse and allows them to further refine their searches by choosing specific product categories and subcategories. As a seller, choosing the right BTG is key for optimizing discoverability and maximizing sales.

ISSUE 02

How the Number of Competitors Per Category Can Affect Sales and Revenue Short answer: The more competitors in a product category, the more difficult product differentiation becomes, which may result in lower sales and revenue. For this reason, and this reason alone, searching and understanding the competition in each product category is critical to developing a winning sales strategy. Capitalizing on Best Seller Rank Profitability is the obvious consideration when choosing which products and product categories to sell on Amazon. Choosing an oversaturated product and/or category could create a recipe for disaster if unable to achieve product and marketing differentiation. As you may know, certain product categories possess a higher profit margin compared to others. For example, entering a product category that contains 1,000 competitors, versus a space that contains 100,000 competitors, provides a greater opportunity to maximize marketing efforts and increase sales. Maximizing Keywords Within an Amazon Listing Amazon search results are largely based on product keywords. Identifying and incorporating product-specific keywords into key areas of a product’s listing – title, bullet points, description and back-end keywords – is absolutely essential to enhancing discoverability. Using the wrong keywords within the right (or wrong) product category will almost guarantee lower consumer viewership and sales.

Category Terms of Service (TOS) Amazon provides sellers with an opportunity to classify their products based on search terms and product categories to enhance discoverability. Adhering to Amazon’s goal of using the product catalog to differentiate products based on attributes can lead to enhanced product views and sales. In the past, to stand out amongst the crowd of competitors, sellers would knowingly misclassify their products to maximize viewership and sales. Amazon has since cracked down on this deceptive practice and has advised sellers of the ramifications of such actions, which could result in account suspension or deactivation. Remember, as a seller, properly describing and distributing your products is essential for building consumer and brand confidence. First impressions are key – for people and brands alike – so be mindful of the experience your customers are receiving. Choosing the Right Product Category Product classification is the most crucial, yet arguably the hardest, part of the sales process for many sellers. In addition to competing with similar products, they are also competing with Amazon-branded products in their category. Identifying underserved products and product categories may help increase product revenue, reduce the cost of advertising and – ideally – help sellers stay ahead of sales trends, if properly researched and identified.

THE ZQUARED ADVANTAGE At ZQUARED, we assist our Brand Partners in establishing fully optimized Amazon product listings, including proper categorization. Our teams of industry-leading experts understand the complexities of establishing, maintaining, refreshing, and staying compliant with Amazon product listings, and we take the guesswork out of the equation by helping to establish and maintain control of a brand’s presence.

We provide end-to-end solutions that focus on growing our clients’ businesses through advanced strategies and execution, proprietary technology, forecasting tools, logistical support, product distribution, and more.

ISSUE 02

Community 19

Founded in 2010, ZQUARED is ranked as a top 125 AMAZON SELLER with over 75k reviews, 100% of which are positive over the last 12 months. OUR PURPOSE ZQUARED invests in brands who sell on Amazon and are poised and ready for growth. WE-COMMERCE Putting the “we” in e-commerce. ZQUARED, we are a team of professionals At who understand the opportunities, risks and challenges on Amazon. With nearly 40 years combined experience as Amazon sellers, our primary goal is helping you multiply your success by serving as an extension of your team to maximize results. From distribution to advertising strategies, we have solutions proven to grow your brand.

YOU GROW, WE GROW—TOGETHER Built on the belief that all boats rise with the tide, our services are based on this principle. ZQUARED invests time, money, effort and energy into brands poised for success with the expectation of a worthwhile result— because we go all-in, growing together and winning when you win.

OUR MISSION

Our mission is to invest in brands who sell on Amazon and are poised and ready for growth by forming partnerships built on trust and rooted in relationship to maximize value and achieve results.

ISSUE 02

OUR VALUES UNPARALLELED CULTURE ZQUARED’s motto is “we—not me”, and we strive to build an unparalleled culture by incorporating this attitude into every aspect of our workplace, empowering a team built on communication and trust with a service-based mindset to get the job done. FIRST-RATE EXECUTION We strive to provide unmatched quality when servicing each of our Brand Partners. By intentionally being proactive, prepared, and in constant pursuit of improvement, our promise hinges on delivering top-quality results in all aspects of our work. ENTHUSIASM Our partnerships are more than transactions—we invest in people and brands who share our drive and enthusiasm, deepening partner relations while collaborating to execute expert-level growth strategies.

OUR HISTORY With more than a decade of experience, we’ve learned what it takes to win on Amazon: ultimately, people matter more than products, and investing in people first leads to growth and profitable Amazon brands.

2010

2011

2014

Originally named Advantage Nutrition, ZQUARED brothers and Co-Founders Chad and Zach Cornett set out to establish a brick-and-mortar retail company with an emphasis on health and wellness. They pivoted when they realized e-tail, particularly Amazon, was taking off, recognizing brands needed help navigating the everchanging e-commerce landscape.

Charlie Meyer was ZQUARED’s first official hire, and he’s been with us ever since. Our people are our foundation.

ZQUARED three time its origina basement footprint w and growi 50+.

WORKING OUT OF CHAD’S BASEMENT

HIRING OUR FIRST EMPLOYEE

PLANT IN ST.

ISSUE 02

2019

D has moved es since leaving al spot in Chad’s t, doubling its with each move ing to a staff of

Inc. recognizes ZQUARED as one of the fastest-growing privatelyheld companies in the United States, while the St. Louis Business Journal names ZQUARED on its “Fast 50” list.

TING ROOTS LOUIS

HARD WORK PAYS OFF

2021

AND BEYOND

ZQUARED hires Jeff Bush as President, positioning the company for continued growth