Episode 56 – Want to Make Money on Amazon? Here’s How to Protect Your Products from Infringement
OK, you’ve done your research and are making money on Amazon with a great 1st page product. Love that idea? Well, so will hijackers! On this episode of the Serious Sellers Podcast, Helium 10’s Director of Training and Customer Success, Bradley Sutton speaks with Chris Lyell who has valuable information on how to safeguard your products against infringement on Amazon.
In episode 56 of the Serious Sellers Podcast, Bradley and Chris discuss:
- 02:04 – After College in Santa Barbara, a Pizzeria in Seattle?
- 03:30 – Chris Makes the Leap to Online eCommerce
- 05:02 – After Research but Without a Sample, a $5000 Chinese Factory Order
- 05:43 – A Few Numbers- 5 Million in Revenue and 1.75 Million from His Original SKU
- 06:20 – OK, He’s an Amazon Rock Star – Any Failures?
- 07:13 – One of His Failures Leads to the Focus of His Current Business
- 09:21 – A Patent Infringement Case leads to Complete Account Shutdown
- 11:48 – After a Deal, Chris Becomes a Patent Cop in Exchange for Exclusive Rights
- 15:05 – Chris Begins His Patent and Trademark Infringement Outreach
- 17:27 – Amazon’s Transparency Program and Brand-gating
- 20:45 – Single-Use Scans Help Create Product Security
- 22:20 – Why Chris has a State-of-the-Art Security System
- 25:07 – What are the Current Patent Infringement Concerns on Amazon?
- 27:11 – Success Stories – 147 ASINS Removed Within 21 Days
- 33:22 – How to Reach Out to Chris and His Company
- 34:37 – He’s a Helium 10 Elite Member – What’s his Favorite Use for Helium 10’s Tools?
Enjoy this episode? Be sure to check out our previous episodes for even more content to propel you to Amazon FBA Seller success! And don’t forget to “Like” our Facebook page and subscribe to the podcast on iTunes, Google Play or wherever you listen to our podcast.
Want to absolutely start crushing it on Amazon? Here are few carefully curated resources to get you started:
- Freedom Ticket: Taught by Amazon thought leader Kevin King, get A-Z Amazon strategies and techniques for establishing and solidifying your business.
- Ultimate Resource Guide: Discover the best tools and services to help you dominate on Amazon.
- Helium 10: 20+ software tools to boost your entire sales pipeline from product research to customer communication and Amazon refund automation. Make running a successful Amazon business easier with better data and insights. See what our customers have to say.
- Helium 10 Chrome Extension: Verify your Amazon product idea and validate how lucrative it can be with over a dozen data metrics and profitability estimation.
- SellerTradmarks.com: Trademarks are vital for protecting your Amazon brand from hijackers, and sellertrademarks.com provides a streamlined process for helping you get one.
Bradley Sutton: Today, we’re going to talk to Chris, who’s going to tell us a little bit about how he went from being a biology major to running a pizzeria to now making millions of dollars on Amazon off of only 10 products. He’s also going to tell us how we can protect ourselves against infringement and how he has an 85% success rate with getting hijackers removed from listings. Say what?
Bradley Sutton: How’s it going, everybody? Welcome to another episode of the Serious Sellers Podcast. My name is Bradley Sutton and sitting next to me here—I’m doing this a little bit more often. I’m bringing people in to record these podcasts, especially when they live here in Southern California—we have someone from Redondo Beach. Is it?
Chris Lyell: That’s right.
Bradley Sutton: Redondo Beach native here. Chris Lyle, how’s it going?
Chris Lyell: It’s going great. How are you doing?
Bradley Sutton: I’m doing just delightful. Chris, we met, first, I think at the billion-dollar summit over in Austin, Texas.
Chris Lyell: Yep.
Bradley Sutton: I remember you had told me that you had a couple of cool tactics you wanted to share with our audience, which I think they’ll get a kick out of. But before we get into that, we’ve met a couple times since then, but I really don’t know too much about your backstory, and I always like to find out the origin story of who I talk to. Always, there are interesting stories that you guys have. Everybody seems to take a different path in their e-commerce journey or their life journey. I always like to get different aspects. First of all, where are you from actually? Were you born in California?
Chris Lyell: Yup. I was born in Los Angeles, California, moved around a little bit, spent some time in Merced California, and then after high school, went to school in Santa Barbara.
Bradley Sutton: Santa Barbara. Okay, cool. So, in Santa Barbara, I’m assuming this is at UC Santa Barbara.
Chris Lyell: It is.
Bradley Sutton: Well what did you study there?
Chris Lyell: I actually studied biology.
Bradley Sutton: Biology. Okay. I love it. Always when I ask that question. It’s like something completely different. Guys, there is no BA in Amazon marketing at this time. I’m sure there will be soon, but people come from all different kinds of backgrounds. So after college, what was your career like?
Chris Lyell: I actually did a little bit of real estate for the first couple of years. Didn’t really have any idea what I wanted to do. My degree was originally to go to school to become a dentist; I decided I didn’t want to be stuck in an office, working on people’s mouths every day. And so, I actually opened up a pizzeria up in Seattle randomly after my real-estate ventures. And that was my first.
Bradley Sutton: That seems like a very typical thing to do. “Hey, study in Santa Barbara and open a pizzeria in Seattle.” Very logical step there. Can you tell me a little bit about how in the world you came to that idea?
Chris Lyell: Yeah. My dad actually had previously owned a small chain of pizzerias in Seattle and had sold them at one point, and there was an opportunity to pick up another pizzeria that was up there. And so I had no real direction of where I was going at the time. So, I jumped at the idea to pay a couple thousand dollars and open up a pizzeria in one of those locations there.
Bradley Sutton: Okay. That makes a little bit more sense now when you put it that way. So, you are in your early mid-twenties running a pizzeria up there. What happened with that?
Chris Lyell: It did well, I just didn’t really like Seattle. Sorry for anybody who lives in Seattle, but it was a little too rainy; one of it was the worst winters they had had in 20 years. There was actually snow locally, and so I was just ready to get out and get back to the beach cities. And so we built the business up, and we were able to sell it for a substantial profit, and that kind of got my entrepreneurial spirit rolling, and it’s kind of been going ever since.
Bradley Sutton: Okay. So when did you start venturing online? Was Amazon your first online venture or were you one of those ones who started on eBay or something like that first?
Chris Lyell: Yeah, Amazon was my first real e-commerce venture. I had owned a large call center for different customer services and consolidations for student loans, and I decided that that was a little bit too much. I had a lot of employees and didn’t like the stress that has kind of taken over my life, running that big of a company. And I stepped down and decided that I wanted to do something that was just me as my own boss. I ventured into the Amazon world, watching YouTube videos and listening to people like Manny Coats on his AMPM Podcast.
Bradley Sutton: So, this is recent. This is like in the last four years when you started?
Chris Lyell: It’s been about three years since I started.
Bradley Sutton: Cool. Cool. And then, did you take any course to learn Amazon?
Chris Lyell: Nope, I taught myself through lots of trial and error.
Bradley Sutton: Are you still selling your first product?
Chris Lyell: I am still selling my first product.
Bradley Sutton: Okay. Usually, when I ask that, they’re like, “Nah.” So I’m like, “Okay, go ahead and tell us what it is.” And they’re like, “Ah, I sold a fidget spinner or a garlic press, and we get a kick out of their first product.” So, but that’s pretty good. That shows that right off the bat you must have a knack for at least the product research part because if you can hit a home run on your first product that you are still selling three, four years later, that’s pretty impressive.
Chris Lyell: Yeah. I researched this one product; I found it and I was really antsy. And so, before even getting a sample, I decided I wanted to buy $5,000 worth and I had it shipped directly into Amazon.
Bradley Sutton: Wow. From China?
Chris Lyell: From China. Sight unseen from China.
Bradley Sutton: Never even saw a sample, let alone the actual product.
Chris Lyell: Yup.
Bradley Sutton: And took off right away. That’s awesome. So now we fast forward. We’ll talk a little bit about filling in the blanks, but how many products or how many SKUs do you have right now, and what’s your 2019 estimated total sales going to be?
Chris Lyell: Right now, I have about—let’s see. We have 10 SKUs right now that we’re managing or that I have. And then managing a couple other different people’s brands. But I think our total revenue this year will probably be about $5 million.
Bradley Sutton: All for 10 SKUs.
Chris Lyell: Yes.
Bradley Sutton: Wow. Do you have a $1 million SKU?
Chris Lyell: Yes, we do.
Bradley Sutton: Wow, that’s awesome.
Chris Lyell: $1.75 million on one.
Bradley Sutton: $1.75? Was that your first product?
Chris Lyell: It was.
Bradley Sutton: Hold on. The product that you just completely ordered blind and didn’t even get a sample, four years ago, and that one product is still to this day making $1.75 million.
Chris Lyell: That’s right. Yup.
Bradley Sutton: Well, what kind of BSR does it have? The category.
Chris Lyell: I think it’s like a hundred, 125.
Bradley Sutton: Wow. That’s crazy. That’s really great. Tell me a little bit about some of your failures along the way. Obviously, you did not just order, sight unseen every single product since then, but I’m sure something might’ve happened that it was like, “Oh my God, this is a disaster. How did this happen to me?”
Chris Lyell: I’ve had quite a few of those. Obviously my first product was kind of a home run—very lucky to have picked that product. I’ve had a couple other products that I didn’t know exactly what I was doing, and I hear a lot of people call them “the me-too products.” I had an idea for a wallet that I thought was going to be a home run. I probably have a thousand of those sitting in my garage. I have a couple other products that I had purchased that didn’t realize were going to be kind of a large return-type product were in the 10% or 20% return. And when you have those products being returned or you have issues with electronics and things like that, your margin gets eaten up so quickly. Those are two of the issues I’ve had. But one of the products that I actually had bought from Alibaba and sent into China as well had some patent infringement issues that had come up that kind of led me into the path that I’m in today. Now, with patent infringement, I’m helping people actually enforce their patents as well as trademark enforcement.
Bradley Sutton: Then, what happened was you’re like, “Here’s a good idea or product. I see there’s demand. I’m going to make one.” And then all of a sudden you get hit with a message saying that, “Hey, we have this patented, you guys are infringing our patent.” Is that in a nutshell kind of what happened to you?
Chris Lyell: Yeah, so I got what they call the email of death, where it basically said, “Your account’s been suspended. You can either have the rights owner retract their complaint against you or provide us with an invoice that we can verify against the manufacturer that this product is the real thing and that you have permission to sell it.”
Bradley Sutton: Did you have all of your products on that same Amazon Account?
Chris Lyell: I did.
Bradley Sutton: Then your whole entire multimillion-dollar business went to a screeching halt during this time.
Chris Lyell: Yup. It was very scary. I had a lot of money out in inventory. I didn’t really know what I was going to do. And so basically, I spent the next, let’s say, 72 hours researching everything you can imagine in regard to not only patents and trademark but also how it works with an Amazon. It’s not a normal business that you can just call somebody up and Amazon and say, “Hey, I’m having an issue, can you guys help me out? I didn’t realize I was doing this or that.”
Bradley Sutton: Okay. I’m just trying to wrap my head around how you must’ve felt at this time. Are we talking last year or when was this was?
Chris Lyell: I think it’s at the beginning of 2017.
Bradley Sutton: Okay. Beginning of 2017. You’re sitting in high and mighty “I went from pizzas in rainy weather to making a ridiculous amount of money on Amazon.” And I’m assuming that at that point, it was a hundred percent of your income? Where you selling on brick and mortar or other websites or anything or was pretty much 100% of your income from Amazon at that point?
Chris Lyell: That was my only income.
Bradley Sutton: That was your only income. Now, this report that they made, was it legit? I mean, did they literally have the correct patent and were you infringing on them or were they kind of twisting things or. . .
Chris Lyell: This product I had bought was actually a product that I thought was the real product I bought from Alibaba. I actually bought a branded box that was for this specific product and I put it into sale almost as if it was like arbitrage. Yes, I was infringing on the patent, but the person I had emailed in the email they provided for me to contact the so-called rights owner was actually not the real rights owner. I emailed the person, asked them, “Hey, you know, I made a total mistake. I want to try to get my inventory out. Is there any way I can pay you a licensing fee for these 500 units or a thousand units I have and I’ll stop selling. And the person responded back quickly and said, “please send me your invoice and I’ll get back to you.” They never got back to me. So for four days, I emailed the guy probably 50 times saying, please, please, you know, I have basically just trying to get my account reinstated. I didn’t really care what I was going to lose on that product, but that product itself, I realized that that wasn’t the patent owner. And I actually went on the USPTO (United States Patent and Trade Office) and actually looked up who the patent owner of this product was and contacted their attorney directly and said, “Hey, I want to license this product. I think somebody is impersonating your company on Amazon and is dictating what’s happening with your brand and you guys have no control of your brand.”
Bradley Sutton: Hold on here. Basically, what happened was that the actual patent was valid and yes, you—it’s not like you purposely are going in and trying to copy somebody—unknowingly got It. And so yes, definitely you’re infringing on the patent, but the one who reported you was not even the actual company. How did you figure out that it wasn’t the legit company?
Chris Lyell: Well, so after I started looking a little bit deeper into it, the first thing was the response was not in English. It was like Chinese-translated English. You could tell it was translated. But also, for such a large brand that this ended up being, their brand name, they had a website, but the email address was an @outlook.com email address, and I was highly doubtful a company that’s doing this much volume has @outlook.com address. And so, after I contacted that attorney, I got connected with an infomercial company that does the ad seen on TV-type products, which is what this was. And after being able to actually discuss and talk with them, I realized was a much-greater issue that they were having. They were having this with a lot of their products. And so, I worked out a deal with them, basically a short-term distribution agreement and said, “Look, I can get rid of every single person on your listing.” After my 72 hours of research, I was an expert, of course. “I can get rid of every person on your listing. I want to be able to sell your product exclusively on Amazon, and I’ll continue to police your listings. “
Bradley Sutton: Now at this point, as this conversation was going, you’re still suspended.
Chris Lyell: Suspended.
Bradley Sutton: Well, what day are we in now?
Chris Lyell: I think this was probably March of 2017. We’re like…
Bradley Sutton: I mean, what day of your suspension?
Chris Lyell: We were like 20 days in.
Bradley Sutton: Oh my goodness. It wasn’t just three or four or five days. So, you’re 20 days of nothing going on?
Chris Lyell: Yup. And so, they said yes “Hey, we hired somebody in house to try to do this, and it’s not really working out. I think it sounds like you know what you’re doing. Let’s give you a shot.” So they gave me a shot, and they basically gave me the rights to enforce their patent. They gave me the copies of the patents, and they let me go on Amazon and basically go in and try to get the person.
Bradley Sutton: How did you prove it? Because a lot of people who are in this, once they get in this cycle of death, the spiral of death – Well, what’s that thing in the ocean—the whirlwind or whatever, right? It’s all computers where you can’t even get to a real person. How did you even get to present your case to Amazon and say, “Hey guys, slow your roll here. This is not the right company. Here’s this proof and here’s this proof.” How did you even get in front of a human being?
Chris Lyell: I left one part out, I forgot to mention. In my 50 emails to the fake rights owner, I offered him $5,000 prepaid to retract the complaint to let me sell through my product. Little did he know that as soon as he retracted that complaint and let me back onto Amazon, which I paid him, and once I was back on Amazon, I was able to get their brand, brand registry and then take over from there.
Bradley Sutton: The brand registry from the real rights owner.
Chris Lyell: Correct.
Bradley Sutton: Now was that guy who was reporting you, was he one of the other sellers that was on there or he’s just some random guy trying to take advantage of the situation?
Chris Lyell: He was a counterfeit seller as well. He tricked Amazon. He didn’t have brand registry. I don’t know how he got ownership of that listing, but that guy had a lot of sales. I mean, he was doing 500-600 a week of that product, and he was kicking everybody off. So he was owning that actual listing.
Bradley Sutton: So, if you hadn’t done that then it might’ve been like what I said; you might not have been able to even present your case to Amazon to prove that this is the wrong guy. You almost had to bite the bullet. And I mean, at the time, you’d pay that $5,000 because at that time, you thought it was legit or did you already know that he wasn’t at that point?
Chris Lyell: Oh, I thought it was legit, and all I wanted was to get my other listings active. I didn’t care about this particular brand.
Bradley Sutton: Yeah. Even if you knew he was a counterfeit, it probably would have been worth it for you just to go ahead and say, “Okay, fine. I’ll pay you the $5,000. I’ll eat that because I can’t even get my account back active so that I can start taking over the brand registry and stuff like that.”
Chris Lyell: Right. And so once I got him to let me back on and I was in the talks with this infomercial company, I was just really frustrated that that was possible on Amazon. And I know there’s tons of people who probably deal with this every day. You read it in all the different Facebook groups and different things we’re in. People always talk about the hijackers that are on their listing. And for me, I was really just kind of obsessed with dealing with the patent and trademark stuff. And so, I wanted to implement my skills that I learned across other brands and actually start working for other companies to be able to do this patent and trademark enforcement.
Bradley Sutton: Okay. Now you said that because of that crazy research you were doing that first 72 hours, I’m sure you did not sleep very much. Matter of fact, I didn’t sleep much last night; I was preparing since you’re coming to our elite workshop tomorrow, right?
Chris Lyell: Yup.
Bradley Sutton: I was up until six in the morning making the slides. I hope you enjoy my hard work. I can just imagine you, like me, staying up reading a whole bunch of law books or whatever until three in the morning, six in the morning, each night. And you said at that time, you actually discovered a way to be able to kick off other sellers. Now, when I say to kick off other sellers, are we talking about legitimate people that were selling the actual product, because they wholesaled it. Or we’re talking about people who were buying fake product and just selling it as this brand?
Chris Lyell: There were two different ways that this was happening. People were buying, whether it was on clearance or other ways of getting the product at a discounted price, and they were selling that on Amazon. But there was also the issue with the counterfeiters who are buying the fake product from China, and it looks just like the real one.
Bradley Sutton: There is a legitimate product, but you know they were kind of buying it and reselling it. Maybe technically not new or something. But then, there was the actual counterfeit. Does the method you’re about to enlighten us on apply to both or only one or is it a different method for each of those kinds of sellers or what?
Chris Lyell: This method will work for anything that’s on your specific listing. We got introduced into a program, and I’m not sure if you’ve heard of it—other sellers I’m sure—have called the “transparency program” that Amazon has.
Bradley Sutton: Tell everybody really quick, because 95% of our listeners might not understand what transparency is.
Chris Lyell: The Amazon Transparency program. A lot of people want to get what’s called brand gating so somebody cannot get onto your listing without approval from you. If you’re a smaller brand, which is the majority of the brands, and people we talk with who don’t have the ability to do that. The Amazon Transparency program essentially is a sticker barcode program. Each barcode is going to be its own individual, like a license plate and they’re given to you by Amazon and you put them into QR codes and those codes get stuck on each of your products. So, each product has its own individual license plate, and those have to match up with the barcodes that Amazon has in their fulfillment center. If you were to go to send in your product and it didn’t have one of these legitimate barcodes on it, Amazon will basically mark it as defective and make you pull it out of Amazon. Essentially, you’re creating a gate because if your product doesn’t have the proper barcoding on it. If somebody is selling a fake product, they send it in, they don’t have that barcode, they’re not going to be able to get past the gate of the fulfillment center of Amazon.
Bradley Sutton: It’s not like the typical brand gating, which we might as well mention what that is too. Nobody can even list product on a certain brand with a certain brand name on Amazon unless they have been ungated. This is even without that typical brand gating; this is a way to “gate” your product because once it arrives at Amazon if it doesn’t have that barcode, they’re not going to accept it into their inventory.
Chris Lyell: That’s correct.
Bradley Sutton: Okay, so now we know what transparency is. We know what brand gating is. Let’s talk a little bit about the first kind of seller, because I used to work for a diet pill company, and they sell in every Walmart and every Target. They’re on infomercials everywhere. And what was happening was – the people were buying it off of Walmart, and when they do a big discount or maybe trying to order it in bulk, maybe buying from these Walmart and Kmart, lots where the pallets get damaged, and they just try and wholesale it out by the pallet. What’s that called? Liquidation people. The people were able to resell for a cheaper price than what the actual company was selling. But what they were worried about was, “hey, this is an ingestible product.” This is a diet pill, right? Even if somebody just buys the product from Walmart off the shelf, this stuff has a year and a half shelf life. It could be sitting in their car for a year and two months in the sun, whatever, or frozen somewhere; we have no idea. And then they’re reselling it as new. Now, if somebody gets sick off of something or they’re ingesting it because it hasn’t been stored in the ideal circumstances. They’re not going to go after that Amazon seller. They’re going after that brand name because, “hey, I’m taking this brand name’s products.” And so they’re like super concerned about liability. Yes. Technically it was the actual product, you know, it’s hard to counterfeit a diet pill; so it was an actual product, but they felt that it was an infringement and actually a safety issue. But they never were able to really get Amazon to take action to kick these other guys off. They’re like, “Oh, they give the one I’m sure you’re very familiar with.” We don’t police distribution agreements or whatever that standard thing is, so I’m sorry, you will have to take care of that yourself. For them, if Chris showed up at my old office there, how would you have advised them to take care of those other sellers?
Chris Lyell: One of the ways that transparency originally started and still what they require is they want you to put those stickers on every SKU; if it’s under the transparency program they want every single one of those products you produce to have those barcodes on it. If you’re sending it even to Walmart or Target because it’s not branded they will have in every single sales channel. And so you can identify where that actual product came from, what lot, what everything came from, right. I can actually scan the QR code; I can see the specific number that it was associated to and I can say, “okay, I sold these 5,000 units to Walmart; this person that’s reselling is coming from Walmart.” What happened with this lot? Most people do not want to do this. So obviously, if you’re just an Amazon seller, no problem. It’s not selling anywhere else. You throw your transparency code on, you’re protected. Because if they’re selling, once that transparency code’s been scanned one time in the fulfillment center, it cannot come back through. So somebody can’t buy it discounted and try to resell it through.
Bradley Sutton: It’s not only just an FN (Fulfillment Network) SKU, which is the same for every product. It’s actually a unique code per product.
Chris Lyell: Every single one has its own unique.
Bradley Sutton: They have to scan it one by one in FBA.
Chris Lyell: That is correct.
Bradley Sutton: I didn’t know that. Now is this what you were using in 2017 when you got back on Amazon and then you had made that deal with that company saying, “Hey, I’m going to help kick off all your other sellers.” Was transparency around back then or were you doing something else?
Chris Lyell: No, so originally, we were just submitting; It was constant submitting of infringement reports. I had a big issue with one of the guys that I actually had paid that money to realized what had happened, and he was coming after me. He had hacked my computer. It’s kind of a crazy story. This guy hacked my computer, sent me my distribution agreements on my personal email. I’m like, “how does this guy know my email?” My email has nothing to do with my name. He was sending products to my house saying, we know where you live. Like crazy stuff. Like I literally have the most sophisticated surveillance system at my house at this point. My girlfriend at the time when I was getting it installed, what’s going on? Why are we doing this? I’m like, I have this crazy Chinese seller who’s very upset with me. She’s like, wait, I thought you sold on Amazon. This isn’t like the mafia, what’s going on? I’m like, I think we just took a lot of money out of this guy’s pocket and he’s not happy. They would get me kicked off even though they didn’t have the rights to do it. I mean, it was a mess with Amazon and after so many infringement submissions with my attorney and everything, we finally were introduced to the beta program of transparency, which is now available to people. It’s very hard to get set up with them still for whatever reason, but that’s what we use today. But back then it was literally just having to go through constantly submitting infringement reports. Probably four or five times a day, just constantly following up because new people pop on all the time.
Bradley Sutton: Then what basis, what you be submitting these infringement reports? Because that’s still a method that sometimes works on something. When would it be, you know, like obviously if somebody who doesn’t transparency or they just don’t have the capacity, another step would be these infringements reports, but when it’s an actual legit product, how are you portraying it to Amazon as infringement?
Chris Lyell: They don’t have a distribution agreement when they buy that product. The way the attorneys do it at this point is anybody that sells, they send a cease and desist letter and they give them 48 hours to remove. A person can email us and say, hey, I bought this in a wholesale lot. I have 25 units. Please let me sell-through. Right? But if somebody figured out a way, most of the time, if they’re selling only a couple of products, we’re not wasting our time. When somebody has 500, 1000, 1500 products on there, they do not have the right to distribute. And so, the attorney itself, will send that cease and desist letter if there’s no response or it’s not a response that we want, they will submit, or I will submit on behalf of the brand an infringement complaint. After that, the person can email me if there’s an issue and if for some reason we’re like, hey, we made a mistake, we should let this person back on. You can easily retract the complaint in 24 hours. You’re not actually getting them suspended from Amazon. They’re getting the listing suspended by the infringement report. So they’ve changed the way they did it back then. When I got suspended, I was off. I don’t know why. Now they’re a little bit more lenient, but before it was, you were, you were off.
Bradley Sutton: Now it’s like ASIN based, not necessarily that account, but an ASIN, right?
Chris Lyell: Exactly. Yeah.
Bradley Sutton: Okay. All right. So then, things change on a monthly basis on Amazon. That was 2017. Now we’re in 2019. What are some, I know you’ve helped people you know before or maybe some things that have happened to yourself on either side of it, like maybe somebody’s infringing on you or the opposite, somebody was illegally or not correctly accused of infringement. Can you give some examples in 2019 something that’s happening, you or something, and one of your networks and one of your friends that you know without mentioning exact names and products that you could tell us?
Chris Lyell: One of the things that we’ve gotten into, now that we’ve figured out how to actually keep your channel clear and make sure people aren’t eroding your pricing, one of the big issues that we’ve seen is, okay, I can control my brand, but if I have a patent, how do I stop the other 22 listings that aren’t using my brand name from actually selling and competing against me? What we’ve done, and we now do this, we manage this for brands specifically, is we actually sue on behalf of one brand. We sued Amazon. We went to arbitration or we were going to arbitration. With our attorney, we have an in-house counsel now for our company that does this, but they had offered us an internal contact at Amazon to do a patent evaluation. We submit all of our paperwork and what we see as an infringing portion of our utility patents are the ones that we manage. And with Amazon, we submit a list of ASINs that we believe are infringing, and Amazon gives them 21 days to respond, all those ASINs. If any of those people respond and say, we don’t think we’re infringing. Both parties have to put up a specific amount of money, $4,000 each, and they will decide who was infringing, who wasn’t. Whoever wasn’t infringing would be able to keep their listing and get their money back. But if not, they yank that entire catalog listing off of Amazon for good. One of the companies that we do the brand management for, we actually submitted this patent evaluation and we were able to get 147 ASINs removed within 21 days after submitting to our internal contact at Amazon. There’s huge success stories like that where we’ve actually figured out, because Amazon doesn’t want to be the police, but if you actually have an attorney that can contact their internal contacts, we’re able to get some, a significant amount of people removed that were infringing that we really had no way to control except for just continually submitting and they just keep popping back up.
Bradley Sutton: Do you help the other side of the point too? Somebody in your boat in 2017 where either some counterfeit person is able to get you kicked off or maybe the actual rights owner, but they really don’t have a patent or you’re not doing anything wrong. Have you been able to reverse that process at all?
Chris Lyell: I’ve helped people who we talk to on these different forums and through Facebook and stuff like that. I’ve helped other people, but my company that I have now, we do a lot of brand management. We actually do that only on the side of people that are infringing on our patents. We try to get their listings clear and make sure they’re not having any issues with their channel management. What’s happening a lot of times is somebody’s going to come on and sell a fake product. Let’s say $19.99 is your MSRP. Well, they get it made in China for so cheap and they can beat everybody else who’s selling the real product by selling it at $14.99. If you’re selling them at Walmart and Target for $19.99, they’re not going to be too happy when there’s a competing product for $5 less and all the business goes to Amazon. And so that’s what we’ve done, is try to control that channel for them. So, it’s just like another retail distributor.
Bradley Sutton: All right, so, well we mentioned a little bit about brand gating. In my experience that’s almost like completely random, like in the last couple of years, you can ask Amazon until the cows come home, please give me brand gating and sometimes even if you have proof of a lot of infringement and they were just like, no, or, or maybe. Then all of a sudden on another account, I was looking at a friend’s account.; they’d never asked for it once. And then one day I was looking at their account; they had brand gating on their brand. They never had any issues or anything. So no, that was, that’s been a year since I’ve really looked into this. But is that still the case? Is it kind of just random or, or is there a process that you can go through that’ll give you a good chance to get the other kind of brand gating?
Chris Lyell: I think about three years ago there were people or attorneys who used to promise brand gating. That’s no longer really available. I don’t know what it is that is triggering them to allow that. You have to be a very big brand. But again, like you just said, sometimes it’s just totally random. Like that person, I don’t know how big their sales volume is.
Bradley Sutton: Maybe $1 million, I don’t know. Or like 500,000 to a million.
Chris Lyell: And so for the amount of infringement issues that we have, you’d expect them to open up the door or the conversation. For us, we have not had that. The only thing they’ve offered us is again, that internal contact for patent infringement. But also, they say, “hey, we have a great opportunity for you to create your own brand gate by using our transparency program.”
Bradley Sutton: I’m sure there’s still litigation going on, but I was reading somewhere like this week or last week or last month, there was an article about how somebody had sued and now Amazon is liable for things that third-party sellers do. You know, before it was like, “Hey, third-party sellers sell something, that brand or that manufacturer, they’re liable.” But now, supposedly something just passed, where they’re like, “no, Amazon can be liable too.” Obviously, you’re not Nostradamus, but do you have any predictions as far as how that might change anything?
Chris Lyell: I think it would make them a lot more receptive to the issues where brands are saying, “look, this guy is selling a fake product.” Because when you sell fake products, there are no tests for quality or anything like that. And if Amazon could be stuck holding the bag for liability, they’re going to, I think, open their eyes up a little more to this. Right now they’re turning a blind eye. The only way that you can do anything as you almost have to initiate some sort of suit against them to actually speak to somebody higher level that can listen to your problems. The other thing I think that’s going to happen if they do that is Amazon’s going to require proof of product liability insurance. They want you to have the responsibility. So even if Amazon is a “responsible,” they’re going to come and try to mitigate their loss by coming after your insurance. There is the opportunity; people are going to have to get product liability insurance or have legitimate liability insurance. You can’t have just a fly by night seller on there selling BS products.
Bradley Sutton: Cool. Well, let’s give some people some hope out there, but a lot of people I see on message, not message boards, we don’t call them message boards anymore. I’m too 1998; Facebook groups and different things. You know, they’d been trying for weeks and months to get other sellers kicked off. But using some of the strategies that you help sellers with yourself or that you advise them on, and of course, if they have all their correct information, you know that this is an actual legit claim, and there’s a legit case to be made and they have the trademark and all that stuff. What kind of success rate using the right strategy can people expect if they tackle these issues in this way about getting people kicked off that they need to get kicked off?
Chris Lyell: It’s an ongoing battle. Even if you do get your initial clearing of your listing people. If it is a highly counterfeit product, people are going to keep popping in. People that use our company; it’s called 10X Growth Partners. We offer a money-back guarantee on some of the things that we offer, especially the patent infringement issue, but I would say, 80-85%, if you actually have the proper documentation, you have a brand registry, you should be able to get people removed that isn’t supposed to be on your listing.
Bradley Sutton: 85%. That’s awesome. Now you said you used to listen to the AMPM Podcast. Do you remember Manny’s catchphrase? What, what would he say to that if you knew that you could get 85%? He would say how cool is that? Pretty cool, I think.
Chris Lyell: Yeah, that’s right.
Bradley Sutton: Okay, you just mentioned the name of the company. I didn’t catch it. Can you say it again? Is there a website that people can check if they have more questions that a 30-minute podcast here doesn’t answer? How can they reach out to you to get some help with their listing?
Chris Lyell: Yeah, you can go to our website. It’s 10xgrowthpartners.com.
Bradley Sutton: And then there’ll be a contact form on there?
Chris Lyell: Contact form. There’s a phone number to call our office, or email, whatever’s easiest. And I’ll take a look at; I look at every single one, the person that calls us. I take a look at their actual individual situation and advise them if they would need our assistance or if there’s a simple fix. I believe in paying it forward. I’m going to help people and just say, “look, all you need to do is this, this and this.” You don’t need to pass to help you. And again, we have a general counsel on board that does a patent review, so we can tell you what Amazon would or would not accept. There’s a lot of resources that we can help you guys out with and look forward to chatting with some people.
Bradley Sutton: Cool. And if you guys are the 15% that it doesn’t work for, remember, do not go trying to find Chris’s home and try and harass him. He has got a state-of-the-art security system and you’ll be on camera.
Chris Lyell: That’s right, and I’ll send the videos into Helium 10.
Bradley Sutton: There we go. Well, we’re going to put it on the FBA high rollers there. Anyways. Chris, thank you very much for coming on here. I’m going to be seeing you tomorrow again at the Elite workshop. Just real brief, you know, we haven’t talked much about other Amazon’s strategy, but you mentioned that you’ve been using Helium 10 for a while. You’re an Elite member. What are a couple of your favorite functions or what does your team use Helium 10 the most for?
Chris Lyell: At this point, one of the things that we use it for a lot is Profits. I don’t know, I think everybody has access to that, not just Elite members, and it really gives you an insight into the business profitability—a lot of things you don’t realize, whether it’s your shipping fees or your monthly storage fees; it’s very hard to find that information on your normal seller central accounts. Using Profits is very helpful. And then, the new Follow-Up feature is obviously a big help. We have a product that we need to give some special instructions for and being able to get ahold of those customers on a timely basis, whether it’s within two days of the product arriving or whatever it is. Getting that out to all the customers is a huge help for our company.
Bradley Sutton: That’s cool. That’s cool that you mentioned those 2 tools. One year ago we didn’t even have those tools, and now they’re your favorite 2 tools in the Suite. If anybody else has some kind of suggestion on a certain tool that we don’t have yet, but that you want us to have, make sure to let us know. Actually, I can’t tell Chris right now. By the time you guys are listening to this episode, everybody’s going to know, but tomorrow, he’s going to be the very first person as an Elite member to find out about a brand-new tool that we’re going to release. And so again, Chris, thank you very much for your time here, and we’ll be seeing you in the Elite workshop.
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