Revolutionizing Amazon Strategy: How ARMR Propelled Eastern Jungle Gym Sales by 201%
Company Background
We worked with Eastern Jungle Gym, a manufacturer of DIY playground swings and accessories. The ease-of-use and quality of its assortment garnered recognition for the brand and built a strong baseline of customer reviews.
EJG operated on Amazon under a 1P / Vendor relationship, selling directly to Amazon, fulfilling purchase orders generated by Amazon’s demand models.
Obstacles
Reliant on high order volume generated during its peak-season, the brand was seeing a 28% YoY decline to its normally stable seven-figure business.
Coupled with declining sales velocity, Amazon profitability had shrunk. Increases in shortage claims and chargebacks and a proposed 25% increase to their Vendor accruals raised concerns as to whether Amazon would be profitable as a channel.
Eastern Jungle Gym needed a comprehensive solution to improve fulfillment operations, improve profitability, and deliver year-round growth to platform sales.
Solutions
ARMR identified the routine purchase orders were inefficient for the brand’s heavy & bulky items. Through integration of Amazon’s Direct Fulfillment and Pallet Ordering programs the brand would reduce freight costs, eliminate deductions, reduce customer lead time, and ensure Prime-eligible offers.
Leading accruals negotiations, ARMR successfully rebuffed the 25% accruals increase, without concessions to lower product costs or increase advertising spend. Our audits identified persistent deductions and a miscalculated Volume Incentive Rebates (VIR) that needed dispute management to recoup missing funds.
We identified that insufficient content detail and the lack of targeted ads were resulting in lost market share to competitors. Using an always-on ad strategy, our campaigns targeted every stage of the customer journey (awareness, consideration, and purchase) during peak season and emphasized consideration & purchase during off-peak months.
The Outcome
Eastern Jungle Gym accelerated sales on Amazon growing 201% YoY. Implementation of Amazon Ads provided an incremental lift of 75% to platform sales operating with an average Return on Ads Spend of 9.6:1. Coupling ads with timed promotions during off-peak months resulted in a 303% lift in annual sales.
Migrating to optimal fulfillment models eliminated $10,150 in annual chargebacks and prevented future ship-in-own-container charges. Direct Fulfillment volume scaled and comprised 60.6% of orders on the platform.
Through refuting increases to vendor accruals Eastern Jungle Gym saved $471,000 over the next two years. A successful challenge to Amazon’s VIR calculations resulted in a reimbursement of $81,500.
+201%
Avg. Annual Growth Rate
$471,000
in Accruals Avoided
9.6:1
Avg. Return on Ad Spend
$81,500
Recouped from Incorrect VIRs
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