Ep 500: Why Spending Too Much on Amazon Ads Could be KILLING Your Organic Results + Tariff Strategy for Amazon Sellers | AKNF - DTC Podcast

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[00:00]
Robin Clifford
If you're a DTC brand and you raise your price, I don't think a lot of people really know you raised your price, but you're beside all your competition on Amazon and you're inside Amazon's ranking algorithm as well. So like if your price goes up, you're typically hurting your ranking and you're likely pricing higher than your competition.
[00:24]
Eric Dick
I talked to a brand today who's like got a year's worth of inventory, so this is a 2026 problem. If it's still around.
[00:30]
Robin Clifford
Tariffs only affect you. They hit the border like they don't affect you when your stuff is already stateside.
[00:37]
Clifford
Finding the balance between spend and organic.
[00:40]
Eric Dick
Ranking, a higher level of spend is actually harming organic rank to the extent that.
[00:53]
Clifford
It'S all killer. No filler. I'm Eric and I'm back with the Amazon brain trust at Pilothouse, Robin Clifford. And I have to say today was the first time I heard someone use the tariffs are terrific, terrific pun. So it means that we have to keep talking about tariffs. I'm not exactly sure when this podcast will come out because we've got a whole suite of tariff based podcasts coming out soon, but I just thought we might start with some thoughts from the Amazon team about what we're hearing from some of our clients and how they're affected by these tariffs. Any, any opening salvos there?
[01:26]
Eric Dick
Yeah, I mean so far and probably not surprisingly is it's quite a range. We've got brands that are manufactured in the U.S. sell in the U.S. they're looking at this as an opportunity. We've got brands that are have a mix between ingredients sourced from China but pack and packaging sourced from China but actually manufactured in the US So they're somewhat affected. And then we've got brands that are just like full China manufacturing importing to the US that are obviously the most affected. So quite a range in each one of those brands is approaching it kind of in a different way, which I can kind of get into.
[02:02]
Clifford
But let's focus on I love I had Brandon from Montana Knife Co reach out to be like hey, I took your survey but like we were just totally manufacture in the us Totally manufacture. You know they're not importing, they're just selling in the US So they're sitting on easy street. So we don't need to talk about those folks as much. But let's maybe go through case by case. What what are the brands who are sort of medium affected either some of their, you know, whether it's their packaging or Their certain ingredients, certain raw materials for their products. Let's talk about them maybe.
[02:33]
Eric Dick
Yeah. So right now we're pretty much just doing the analysis and everyone, the uncertainty is very clear. Nobody wants to make drastic changes to price or efficiency models yet. At least with the brands I've talked to so far, they're in the like. Let's gather data and kind of keep going with the current efficiency targets. But understand like what are the levers we can pull if things don't go our way or things don't change. Some of those levers we're exploring of course are like price changes, changes to the efficiency model, changing our promotion strategy. So starting to like cancel or run less promotions in anticipation for maybe costs going up. Yeah. Clifford, anything to add?
[03:18]
Robin Clifford
Yeah, I mean the big one on Amazon that's I think different from a lot of DTC is if you're a DTC brand and you raise your price. I don't think a lot of people really know you raised your price. Like you know, your devout followers who check your site every day will notice. But you're beside all your competition on Amazon and you're inside Amazon's ranking algorithm as well. So like if your price goes up, your typically hurting your ranking. In most cases your, your ranking is getting worse and you're likely pricing higher than your competition. So that like hesitancy to raise price when you like, even if you know that your cost of goods might be going up or that your efficiency might be or your margins might be worse, there's a big hesitancy to raise price on Amazon because it will directly hurt you in a short term at least.
[04:23]
Clifford
Something to be cautious of and wary of. I think people just, we have no idea. Like I don't think anyone's sense is that we're locked in for the long term with these tariffs. Right. Everyone sort of sees these as, or I hope sees these as a means to an end. They're, they're negotiating tactics to get people to the table. Clifford had some thoughts that we probably can't share on the podcast about what's really going on here. But, but really. So it's hard to, to build long term strategy or aren't thinking long term about these and the industry. What about brands that are like, have we had any brands be like, well it was fun while it lasted, we got to close up shop. Any brands are like, well see you later guys.
[04:59]
Eric Dick
Not yet. But on the other end of that with a couple brands that are even affected, like do manufacture in China sell in the U.S. so, like, kind of.
[05:08]
Clifford
Most affected 104 starts when?
[05:11]
Eric Dick
Yeah, tomorrow. Tomorrow they're actually looking as an opportunity. So one of those brands, they're lucky enough to be sitting on, like, six months worth of inventory. And we're very much looking at the competition to understand, like, hey, are they going to pull back? Are they raising prices? Are they, like, moving towards an efficiency model and like, trying to save cash? Because if they do, we're actually in a position to crush them a little bit and like, make a bit of a land grab. So that's exciting with a couple of brands because they, they had the forethought to stockpile a bit of inventory, stockpile a bit of cash reserves and this as a chance to maybe actually make some ranking gains and yeah, be in a better position when, if things level out in a few weeks.
[05:58]
Clifford
And that really was a strategic play to. To stockpile the inventory. I think that's, that's. I like that approach. That's super smart.
[06:04]
Eric Dick
Yeah. I talked to a brand today who's like, got a year's worth of inventory. So this is a 2026 problem. If it's still around.
[06:11]
Clifford
Yeah.
[06:11]
Eric Dick
And we're like, okay, we're good to go.
[06:14]
Clifford
Super smart. I'm sure they must listen to the all killer no filler podcast. Nice. Anything to add, Clifford?
[06:18]
Robin Clifford
Yeah. And I mean, on that note, tariffs only affect you when they get. When they hit the border. Like, they don't affect you when your stuff is already stateside. They don't really affect you on the. When it's being produced. Like, maybe your stuff takes months to be produced. So there's brands who are producing it right now. But if their shipment's not already on the ocean or it's not already at the border, there's still a ton of uncertainty about what that tariff rate will be by the time it hits the border. It might be like, if they're fortunate, it might be completely gone by the time it even hits the border. If something's on a boat right now, like, we have clients who literally have shipments on boats on the way from China. And I don't think anyone really knows what the tariff rate is going to be when that hits the actual customs broker on. In the stateside. So even just like that level of uncertainty brings a lot into question. I think that's why, like, the push to keep everything else kind of consistent. It's just like you're just going to throw a lot more variables into the mix. You start messing with price when you don't even know what is going on in your import fees to begin with.
[07:33]
Clifford
So hold tight, have a time machine, go back and make sure you've stockpiled inventory. If you haven't, if you have, pat yourself on the back.
[07:39]
Robin Clifford
I will say on the topic though, because we're on Amazon, there's a few like unique Amazon y things because we're on this big marketplace and you're stacked right up against the competition. And as any, as any great Amazon LinkedIn influencer will tell you, the Chinese sellers are the like you know, they're, they are the enemy on Amazon always. They are always the demon Chinese sellers who are cheating the rules always and using keywords you're not supposed to and they get preferential seller support help and things like that. Well, there's also rumors and thoughts that there's a lot of customs cheating that will be going on from Chinese sellers where they'll be lying on declared value forms and things like that. Because there's just not a lot of consequence. If you're not a US based company and you fraudulently lie on your customs declarations, there's not a lot of consequence back to you in China other than probably losing that shipment. I'm not saying do it, probably don't do it, but it does mean that if you are a US based seller who's shipping things in from China and you have a direct Chinese competitor, they might be a little bit more willing to bend or break the rules or change country of origin like a lot of different customs fraud things that you shouldn't do because you're an American based seller and you'd have actual consequences when they might not. Like a weird part of Amazon is that their price might not actually go up despite there being tariffs because a lot of people are finding loopholes or ways around things or shipping ingredients to a different country to get things put together last minute and that's called a transformation. So they ship it in from over there now and the country of origins change like a lot of hacky ways to get around it that are like on the verge of customs fraud that American based sellers 100% should not do. But internationally based sellers might be willing to try because they have less of a possible consequence. And then that that shows up right in the marketplace with prices going up for some and not for others.
[10:01]
Clifford
Interesting. The other thing I've heard from China is their ace in the hole is their patent fraud engine that they're warming up right now where they've sort of threatened to say hey, we could start producing iPhones at pennies on the dollar and flood your market with them potentially which could get ugly as well.
[10:19]
Robin Clifford
So it's a big problem on Amazon too of, I mean the reality is a lot of these products are made in the same factory. So they are just don't slap the brand label on them and instead send the product. But what gets even weirder is they can, I mean not to get too Amazon in the weeds but they'll throw it on the same listing on Amazon and say that they're selling the exact same product. It's like a, it's not, I don't know, I feel like it's not talked about a lot because it's usually not that big of a problem. Now that brand registry exists on site and you can report these types of problems. But back in the day it was a big problem where a counterfeit seller would just hop on your listing and take buy box by undercutting you and then you're. They're leeching all of the sales from your listing selling like a counterfeit item. It's a lot easier to counter these days with brand registry but it's a real concern that still comes up every now and then. And we still do report sellers probably monthly on a lot of brands from counterfeit sellers.
[11:21]
Clifford
What's interesting with these terrorists is they may be short lived but likely we're in the middle of a changing financial order. Like there's going to be fallout from this whether or not tariffs stick around. It's going to be really interesting to kind of keep reporting on how this changes the international economic order and the fallout for our industry. Okay, let's move off tariffs because we've.
[11:43]
Robin Clifford
Got another interesting topic we forgot about and we forgot to put in the notes also of the de minimis.
[11:49]
Clifford
Oh, let's talk to minimus. That's like isn't that just a drop shippers problem?
[11:53]
Robin Clifford
Oh, it's not just a drop shipper's problem. Yes it is a drop shippers problem and yes there are a lot of drop shippers on Amazon. There used to be a lot more. Another thing that Amazon's cleaned up lately. But there's a whole bunch of listings on Amazon. You'll notice it a lot more on Amazon, Canada and others like that where our shipping time is a long time, sometimes like two months. Those are drop shipped. It doesn't say it's drop shipped but those are drop shipped. But selling on Amazon. Let's say you're selling. I never have great examples. Water bottles, let's say not shoes, not Running shoes. Not running shoes. I can't believe I didn't use running shoes.
[12:34]
Clifford
You didn't use running shoes.
[12:34]
Robin Clifford
Okay, water bottles.
[12:35]
Clifford
I like it.
[12:35]
Robin Clifford
Just do running shoes.
[12:36]
Clifford
No, I was ready for something new.
[12:38]
Robin Clifford
Okay, let's say you're selling water bottles. Your cost of goods on the water bottle might be a dollar a pop, let's say from China. Then your declared value on let's say a pallet worth of water bottles might only be $600, $700. You were under de minimis. That is now a shipment that does not need to pay tariffs. If they were, if there are tariffs or customs port fees or whatever else, you would be levied by being a normal shipment. Now, typically large brands don't do this. They ship in like a container at a time or five or six pallets at a time. So it's never under that $800. But a lot of sellers on Amazon will ship one pallet here and one pallet there and one pallet here, one pallet there, and they're just sticking them under $800 of value because the advantage of that outweighs the disadvantage of sending it in separate shipments. So for a lot of sellers, and this is a big thing for in like the private label community, a lot of those sellers are going to experience quite a bit of pain here in being able to restock their Amazon, because suddenly there's a whole bunch of stuff they haven't had to deal with before. And that's not including the massive backlog of packages that's going to happen from de minimis going away. Because I think I saw a stat that there is a billion individual packages that hit the US every year that are de minimis exempt. So all those ones that are coming from China are now not de minimis exempt, meaning someone has to look, or at least a computer or something, however it works, has to look at the value of that and assess a tariff or assess the goods and look at them and whatnot when they wouldn't before. That's a massive job. And I don't think there's been a huge hiring of customs and border examination agents lately. So that's going to cause a huge backlog in everything coming in.
[14:47]
Clifford
And AI can't just do it yet. Just like all the manufacturing jobs that the US is going to be reshoring, um, problematic. So, and so de minimis now would just be subject to whatever tariffs are subject to the country, whereas before they would have been exempt.
[15:02]
Robin Clifford
Now even it gets really weird because if you're sending in Like a very classic the dropship. For example, if you bought something like a water bottle that's like five bucks on Temu, that $5 water bottle on TEMU not only has the tariff assessed, you now have a customs broker fee because customs broker had to do something, someone had to look at it, and you have to pay a fee for the customs broker to do that work. And they assess a fee on top of it. And that fee is probably like the the same value or more than the entire purchase value. So the tariffs are small in that sense because they're assessed on the cost of goods. But the actual like fee that you're paying because of the just the work and time that has to go into it is actually pretty substantial probably.
[15:46]
Clifford
What a time to be alive. Let's talk about finding the balance between spend and organic ranking.
[15:53]
Eric Dick
Okay, so this is all about trying to find the perfect balance of like spend and rank. And what we're noticing, or Clifford's been noticing on some products, is that a higher level of spend is actually harming organic rank for that term. To the extent that removing spend on a term actually one is an Amazon's Choice badge. And the theory goes here that your organic rank and your Amazon's Choice bet, which isn't just based on volume, but also on performance, specifically conversion rate. So as you push incremental spend that actually hits a audience that is converting less, therefore hurting your overall conversion rate and then therefore hurting your organic rank. Because you're not showing Amazon as positive as a metric or as positive as a customer experience. Whereas if you reduce spend and you hit the high converting audience, you maximize the positivity of the metrics you're showing Amazon, you maximize your rank, you win the Amazon's Choice badge. So finding that balance between what is the actual correct level of spend to not lose sales, lose ground, have competitors move in, but what's not too much spend that you're actually harming the organic rank has been making Clifford pull his hair up for the last couple weeks. Did I explain that right?
[17:11]
Robin Clifford
No, that's perfect. And it's exactly the case is or moving spend up and down on products that this is especially noticeable if the product is somewhere in like the low teens to single digit rankings. So somewhere kind of in the upper end of that first page for the search result you're looking for for that search term very clearly. Seems like we never know for sure, there's so many variables. But it sure does seem like decreasing the Spend organic ranking increases. Increase the spend organic ranking decreases almost Seems like a very clear inverse relationship there. The theory is the conversion rate and click through rate. But it also means like now you have to look at other tools, other methods to try to push up your conversion rate. Maybe now you do more promotions, coupons, sale prices, instead of spending more because that will increase your conversion rate more. So maybe those ad spend dollars go into sale prices. Though if you look at that from a business standpoint, a lot of brands won't want that because you'd want to sell at a certain level and your marketing budget goes in this other pool and your revenue is in this other pool. And if you do, a sale price actually comes out of your revenue and not out of your marketing budget. So when it comes to things like trying to sell your brand, usually not the best. So you end up in this weird scenario where if you really try to push spend, you're hurting organic ranking, which is kind of the whole point of what makes Amazon profitable in a lot of cases is that organic ranking and the results you get from that. And with so many more ad placements on Amazon than there was in the past, like three, four years ago, organic was huge on Amazon. Nowadays there's an ad at the top, there's an ad below the top, there's an ad just under the first row of organic. There's ads everywhere. So if you don't spend heavily into ads, you're now not in any of those extra placements just to kind of maintain that organic placement, which is free and gets you really good sales. But maybe the top sales actually in your certain search term especially. My theory is older people click the ads more. So especially if you're in a niche, it's probably older people. Those ad spots might actually be where the top revenue goes. The most clicks might actually go to the ad spots instead of the organic spots. So you're getting free sales there, but you're giving up all of the top line sales there. So you're trying to find this weird balance between like not hurting your top line rev, but also not hurting your organic ranking. So you end up spending somewhere in the middle. That hopefully keeps your organic ranking up, but doesn't hurt your top line rev too much by giving up all of your ad spend. Or maybe you're only running a certain ad type like a video at the top, but you're not running a sponsored product below. Seems to really depend on the search term, how aggressive competition is with spend and stuff there. It's very dependent on category, but it's not just as simple as it Used to be of like just show up at the top as much as you can and the sales will give you organic ranking and then you'll be number one ad and number one organic and everything is groovy. It's a really old word and very.
[20:30]
Clifford
Old word for a young man and. But you are like in your experimenting with as you say or pulling your hair out as Rob mentioned. And then like how much are you lowering ad spend? And I guess it's going to be on a total case by case basis. But. But like just to give the audience like a range. Like what are the ranges you're kind of experimenting with to lower things.
[20:51]
Robin Clifford
Good question. I would say there is like on a specific search term, let's say we spent $12,000 a week previously on that search term. Pretty big search term. That might come down to 6 or 7,000 the next week and then we'll see organic ranking. Follow it up nicely on other cases. In the past months, fully cut spend to some other top search terms and their organic ranking has skyrocketed to like number one or two and just held there the whole time. And we've not resumed spend. We found like I think there's like some really good cases where if you have a catalog of products that apply to that term, you can own some of those search spots with other products. So you kind of like clog it up with the rest of your catalog. But then you have your one product that you're actually trying to rank and you don't spend on that one. So that one ranks up organically. But then you're clogging up the ad spots with the other stuff. So if someone clicks they're still going to one of yours. So you get the ad spots and the organic spots. So you could do something like that. That's like kind of where we've ended up.
[21:58]
Clifford
It really sounds like it depends on your ratio of organic to paid in a lot of ways. And you don't want it if you, you don't want to dilute. Yeah, you just don't want to dilute your organic love that your product gets organically by sending a bunch of paid. You can't. Astroturf I guess is kind of the idea you got to keep, keep things organic. Keep, keep that real connection you have with your customer.
[22:17]
Robin Clifford
And it's weird because you'd think they're searching the term. You know they're there, they're on the site, they're searching your best search term. They should be buyers. But I guess there is a level of Amazon really does know the customer enough that if you're paying for the ads, they're putting you in front of the customers who are searching that term who are less likely to buy you. And if you're not buying the ads, your organic goes to more relevant shoppers who search the term. Somehow they know out of the 10,000 people that search that term that week, 2,000 of them are really relevant and maybe 8,000 of them aren't. Somehow in Amazon's weird background data, an.
[23:00]
Clifford
Example of a platform deprioritizing ad spend, you don't see it very much that you'd think they just want you to spend as much as possible.
[23:08]
Robin Clifford
Oh they do, yeah, to a degree.
[23:11]
Clifford
As but they, they aren't willing to jeopardize that. You know the organic connection I think.
[23:17]
Robin Clifford
Are the kind of working theory is there are two completely not completely separate, but they are two like separate teams or separate algorithms that are ranking them. They affect each other but the organic team prioritizes these metrics like click through rate and conversion rate whereas this paid team kind of just prioritizes sales and ad spend. So kind of two separate forces working against each other. And I, I would assume they don't even talk to each other. Honestly they shouldn't. It's probably best for everyone if they don't talk to each other.
[23:47]
Clifford
Church and state. Very cool. Well very two interesting top I think we covered tariffs for Amazon in an interesting way today. I think this is a great topic. Last note. Amazon prime day in July is four days versus how many? Three used to be three used to be two. It's doubling double those prime days. Pump those pump, pump it up.
[24:05]
Robin Clifford
There's a prime spring. There's now a four day prime day in July. There's a prime fall. Black Friday. Cyber Monday was 12 days last year. We're getting there.
[24:15]
Eric Dick
Yeah. One of our clients made the joke that one year will just be all year will be prime. Just the prime year.
[24:22]
Clifford
Optimus Prime. Very cool. Have you guys watched anything good on prime lately?
[24:27]
Robin Clifford
I have not rewatching Parks and Recreation again?
[24:30]
Clifford
Oh, always good. Always. I just got back from Las Vegas last week and I won a thousand dollars on a Texas Hold'em table. Cleaned out a bunch of other degenerate gamblers and it felt great. Closed down a casino. Felt like a real rounder. Stayed up all night for my flight home and then I came home looking for like more gambling content and I saw that there was a movie like in 2020 with Ryan Reynolds called Mississippi Grind and it's about two degenerate gamblers making their way throughout the United States. It's quite an entertaining movie. I ended up doing some as I do when I watch all movies now. As I was doing some chat gpting, I found it is one of the most horrendous bombs ever made in that it costs like over 20 million to make and made something like $300,000. So as far as gambling goes, it was not a good gambit, but it was quite an entertaining movie. Highly recommend it for anyone out there.
[25:17]
Robin Clifford
Never heard of it. So that makes no it's got Ryan.
[25:20]
Clifford
Reynolds and I know he's not very he's not as as popular right now due to some personal life choices, but still a good actor. So is Ben Mendelsohn, who's in it. I recommend it to everyone out there. I that was totally non sequitur. Just made me think of Prime. So go check it out. Put it on your list of movies that people tell you to watch that you'll probably never watch.
[25:39]
Robin Clifford
Watch the ads when you watch it too.
[25:41]
Clifford
Watch the ads. Oh, I just found out that Netflix, or is it Netflix, is going to start doing ads? No, it was Spotify is going to start putting ads on their platform for people that pay because they're going to create a super premium category for to have no ads. And it's like they're. I know I'll be so I'm I I like their algorithm so much. But if they start doing like this Spotify don't do it. You heard it. You heard us here.
[26:04]
Robin Clifford
We know there's a fun story. My We've had Prime video for like obviously a long time and they've added this same thing. They added the like ad tier and then the pay an extra little bit and you don't have ads. But I kept ads on because I wanted to see the ads, buy ads. But my wife was rewatching like all of Handmaid's Tale and she was in like the end of season two or something. You know, it's like she's been watching like 20 episodes of the show and I was sitting there watching like the end of this episode with her and ad starts playing. I'm so sick of these ads on Prime Video. How much does it cost to get rid of them? I was like, oh, I think it's like $2, I think a month to get rid of the prime video ad. She's like, what? And so she immediately made me buy the ad free tier of Prime Video. So now I no longer see the ads, but it was a pretty funny like we were saving two bucks just so I could see the ads. But I wasn't even watching the show. She was watching it and watching the ads.
[27:02]
Eric Dick
They lost me as a prime video viewer when they added ads.
[27:06]
Clifford
A principal, a principled ad man. Love to hear it.
[27:08]
Eric Dick
Not really. Not much I want to watch anyways.
[27:11]
Clifford
That's fair. Increasingly. Cool. Well, thanks again, guys. We'll talk again soon. Thanks for listening to today's episode. If you're not getting the DTC newsletter, you can subscribe for free at directtoconsumer Co. And if you want to learn more about Pilothouse's all killer no filler services, take off to Pilothouse Co. I'm Eric Dick and this has been the DTC podcast. We'll see you next.

Summary5 min read

Episode 500: Why Spending Too Much on Amazon Ads Could be KILLING Your Organic Results + Tariff Strategy for Amazon Sellers | AKNF

Release Date: April 18, 2025
Hosts: Eric Dick and Robin Clifford
Guests: Brandon from Montana Knife Co.

In this landmark 500th episode of the DTC Podcast, hosts Eric Dick and Robin Clifford delve deep into two critical issues affecting Amazon sellers: the intricate balance between ad spend and organic rankings, and the evolving landscape of tariffs impacting direct-to-consumer (DTC) brands. The discussion is enriched with real-world examples, strategic insights, and actionable advice for Amazon sellers navigating these challenges.

1. Understanding the Impact of Tariffs on Amazon Sellers

Robin Clifford initiates the conversation by addressing the nuanced effects of tariffs on DTC brands selling on Amazon. He emphasizes that raising prices on Amazon can inadvertently harm a brand's organic ranking due to the platform's algorithms.

"If your price goes up, you're typically hurting your ranking and you're likely pricing higher than your competition." [00:00]

Eric Dick expands on this by categorizing brands based on their manufacturing and sourcing strategies:

U.S.-Manufactured Brands: These brands are relatively insulated from tariffs affecting imports.
Mixed Manufacturing Brands: Brands sourcing components or packaging from China but manufacturing in the U.S. face partial impact.
China-Manufactured Brands: These are the most affected, dealing directly with increased costs due to tariffs.

"There's a whole suite of tariff-based podcasts coming out soon, but let's start with thoughts from the Amazon team about what we're hearing from some of our clients." [00:53]

2. Strategic Inventory Management Amidst Tariff Uncertainty

The hosts discuss the importance of inventory management as a strategic response to tariff fluctuations. Robin Clifford highlights success stories like Brandon from Montana Knife Co., who exclusively manufactures in the U.S., effectively bypassing tariff impacts.

"We don't need to talk about those folks as much. But let's maybe go through case by case." [02:02]

Eric Dick shares insights from other brands, noting that those with substantial inventory reserves are better positioned to weather tariff-induced disruptions. He mentions a brand with a year's worth of inventory, humorously dubbing it a "2026 problem."

"I talked to a brand today who's like, got a year's worth of inventory. So this is a 2026 problem. If it's still around." [05:07]

3. Navigating Amazon's Marketplace Dynamics

The conversation pivots to the unique challenges of operating within Amazon's vast marketplace. Robin Clifford warns against price hikes on Amazon due to the platform's competitive pricing algorithms, which can penalize brands in search rankings.

"If you're a DTC brand and you raise your price, I don't think a lot of people really know you raised your price, but you're beside all your competition on Amazon and you're inside Amazon's ranking algorithm as well." [00:00]

They also discuss the competitive tactics employed by Chinese sellers on Amazon, including potential customs fraud and the exploitation of loopholes to avoid tariffs.

"There's a lot of customs cheating that will be going on from Chinese sellers where they'll be lying on declared value forms." [09:30]

4. De Minimis Threshold Changes and Their Implications

A significant portion of the episode is dedicated to De Minimis, a policy that exempts low-value shipments from tariffs. Robin Clifford explains how changes to these thresholds are disrupting the operations of many Amazon sellers, especially those relying on drop shipping.

"De minimis now would just be subject to whatever tariffs are subject to the country, whereas before they would have been exempt." [14:46]

The hosts highlight the logistical and financial challenges posed by the removal of De Minimis exemptions, including increased customs fees and processing backlogs.

"A billion individual packages hit the US every year that are de minimis exempt. So all those ones that are coming from China are now not de minimis exempt." [13:00]

5. Balancing Ad Spend with Organic Ranking

One of the central themes of this episode is the delicate equilibrium between advertising expenditures and maintaining strong organic rankings on Amazon. Robin Clifford introduces the concept that excessive ad spend can adversely affect a product's organic ranking.

"A higher level of spend is actually harming organic rank to the extent that removing spend on a term actually one is an Amazon's Choice badge." [15:52]

The hosts explore the theory that investing heavily in ads might target a less-converting audience, thereby lowering overall conversion rates and hurting organic rankings. Conversely, reducing ad spend can enhance organic performance by focusing on high-converting customers.

"The conversion rate and click-through rate... maximize the positivity of the metrics you're showing Amazon." [17:10]

Eric Dick shares practical strategies, such as adjusting ad budgets on specific search terms and leveraging other products in a catalog to dominate search results collectively, thereby protecting the organic ranking of key products.

"If you have a catalog of products that apply to that term, you can own some of those search spots with other products." [21:57]

6. Future Outlook and Strategic Recommendations

Wrapping up the discussions on tariffs and ad spend, the hosts emphasize the importance of adaptability and strategic planning. They advise brands to:

Stockpile Inventory: Prepare for tariff changes by maintaining sufficient inventory levels.
Optimize Ad Spend: Carefully balance advertising investments to support organic growth without undermining it.
Monitor Competitors: Stay informed about competitors' pricing and promotional strategies to remain competitive.
Leverage Amazon Tools: Utilize Amazon's brand registry and other tools to combat counterfeit sellers and protect brand integrity.

7. Closing Remarks

In the concluding segments, the hosts briefly touch upon Amazon Prime's evolving strategies, such as extending Prime Day and introducing ad tiers on Prime Video. While these topics stray slightly from the main content, they underscore the ever-changing nature of Amazon's ecosystem.

Notable Quotes:

"If your price goes up, you're typically hurting your ranking and you're likely pricing higher than your competition." — Robin Clifford [00:00]
"De minimis now would just be subject to whatever tariffs are subject to the country, whereas before they would have been exempt." — Robin Clifford [14:46]
"A higher level of spend is actually harming organic rank to the extent that removing spend on a term actually one is an Amazon's Choice badge." — Robin Clifford [15:52]

Conclusion

Episode 500 of the DTC Podcast offers invaluable insights into the complex interplay between tariffs and advertising strategies on Amazon. Hosts Eric Dick and Robin Clifford provide a comprehensive analysis backed by real-world examples, empowering Amazon sellers to make informed decisions in a volatile market. Whether you're grappling with tariff implications or striving to optimize your ad spend without sacrificing organic growth, this episode is a must-listen for any serious DTC brand aiming to scale successfully on Amazon.

For more in-depth discussions and tactical insights, subscribe to the DTC Newsletter and Podcast at directtoconsumer.co.

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Transcript62 lines

[00:00]
Robin Clifford
If you're a DTC brand and you raise your price, I don't think a lot of people really know you raised your price, but you're beside all your competition on Amazon and you're inside Amazon's ranking algorithm as well. So like if your price goes up, you're typically hurting your ranking and you're likely pricing higher than your competition.
[00:24]
Eric Dick
I talked to a brand today who's like got a year's worth of inventory, so this is a 2026 problem. If it's still around.
[00:30]
Robin Clifford
Tariffs only affect you. They hit the border like they don't affect you when your stuff is already stateside.
[00:37]
Clifford
Finding the balance between spend and organic.
[00:40]
Eric Dick
Ranking, a higher level of spend is actually harming organic rank to the extent that.
[00:53]
Clifford
It'S all killer. No filler. I'm Eric and I'm back with the Amazon brain trust at Pilothouse, Robin Clifford. And I have to say today was the first time I heard someone use the tariffs are terrific, terrific pun. So it means that we have to keep talking about tariffs. I'm not exactly sure when this podcast will come out because we've got a whole suite of tariff based podcasts coming out soon, but I just thought we might start with some thoughts from the Amazon team about what we're hearing from some of our clients and how they're affected by these tariffs. Any, any opening salvos there?
[01:26]
Eric Dick
Yeah, I mean so far and probably not surprisingly is it's quite a range. We've got brands that are manufactured in the U.S. sell in the U.S. they're looking at this as an opportunity. We've got brands that are have a mix between ingredients sourced from China but pack and packaging sourced from China but actually manufactured in the US So they're somewhat affected. And then we've got brands that are just like full China manufacturing importing to the US that are obviously the most affected. So quite a range in each one of those brands is approaching it kind of in a different way, which I can kind of get into.
[02:02]
Clifford
But let's focus on I love I had Brandon from Montana Knife Co reach out to be like hey, I took your survey but like we were just totally manufacture in the us Totally manufacture. You know they're not importing, they're just selling in the US So they're sitting on easy street. So we don't need to talk about those folks as much. But let's maybe go through case by case. What what are the brands who are sort of medium affected either some of their, you know, whether it's their packaging or Their certain ingredients, certain raw materials for their products. Let's talk about them maybe.
[02:33]
Eric Dick
Yeah. So right now we're pretty much just doing the analysis and everyone, the uncertainty is very clear. Nobody wants to make drastic changes to price or efficiency models yet. At least with the brands I've talked to so far, they're in the like. Let's gather data and kind of keep going with the current efficiency targets. But understand like what are the levers we can pull if things don't go our way or things don't change. Some of those levers we're exploring of course are like price changes, changes to the efficiency model, changing our promotion strategy. So starting to like cancel or run less promotions in anticipation for maybe costs going up. Yeah. Clifford, anything to add?
[03:18]
Robin Clifford
Yeah, I mean the big one on Amazon that's I think different from a lot of DTC is if you're a DTC brand and you raise your price. I don't think a lot of people really know you raised your price. Like you know, your devout followers who check your site every day will notice. But you're beside all your competition on Amazon and you're inside Amazon's ranking algorithm as well. So like if your price goes up, your typically hurting your ranking. In most cases your, your ranking is getting worse and you're likely pricing higher than your competition. So that like hesitancy to raise price when you like, even if you know that your cost of goods might be going up or that your efficiency might be or your margins might be worse, there's a big hesitancy to raise price on Amazon because it will directly hurt you in a short term at least.
[04:23]
Clifford
Something to be cautious of and wary of. I think people just, we have no idea. Like I don't think anyone's sense is that we're locked in for the long term with these tariffs. Right. Everyone sort of sees these as, or I hope sees these as a means to an end. They're, they're negotiating tactics to get people to the table. Clifford had some thoughts that we probably can't share on the podcast about what's really going on here. But, but really. So it's hard to, to build long term strategy or aren't thinking long term about these and the industry. What about brands that are like, have we had any brands be like, well it was fun while it lasted, we got to close up shop. Any brands are like, well see you later guys.
[04:59]
Eric Dick
Not yet. But on the other end of that with a couple brands that are even affected, like do manufacture in China sell in the U.S. so, like, kind of.
[05:08]
Clifford
Most affected 104 starts when?
[05:11]
Eric Dick
Yeah, tomorrow. Tomorrow they're actually looking as an opportunity. So one of those brands, they're lucky enough to be sitting on, like, six months worth of inventory. And we're very much looking at the competition to understand, like, hey, are they going to pull back? Are they raising prices? Are they, like, moving towards an efficiency model and like, trying to save cash? Because if they do, we're actually in a position to crush them a little bit and like, make a bit of a land grab. So that's exciting with a couple of brands because they, they had the forethought to stockpile a bit of inventory, stockpile a bit of cash reserves and this as a chance to maybe actually make some ranking gains and yeah, be in a better position when, if things level out in a few weeks.
[05:58]
Clifford
And that really was a strategic play to. To stockpile the inventory. I think that's, that's. I like that approach. That's super smart.
[06:04]
Eric Dick
Yeah. I talked to a brand today who's like, got a year's worth of inventory. So this is a 2026 problem. If it's still around.
[06:11]
Clifford
Yeah.
[06:11]
Eric Dick
And we're like, okay, we're good to go.
[06:14]
Clifford
Super smart. I'm sure they must listen to the all killer no filler podcast. Nice. Anything to add, Clifford?
[06:18]
Robin Clifford
Yeah. And I mean, on that note, tariffs only affect you when they get. When they hit the border. Like, they don't affect you when your stuff is already stateside. They don't really affect you on the. When it's being produced. Like, maybe your stuff takes months to be produced. So there's brands who are producing it right now. But if their shipment's not already on the ocean or it's not already at the border, there's still a ton of uncertainty about what that tariff rate will be by the time it hits the border. It might be like, if they're fortunate, it might be completely gone by the time it even hits the border. If something's on a boat right now, like, we have clients who literally have shipments on boats on the way from China. And I don't think anyone really knows what the tariff rate is going to be when that hits the actual customs broker on. In the stateside. So even just like that level of uncertainty brings a lot into question. I think that's why, like, the push to keep everything else kind of consistent. It's just like you're just going to throw a lot more variables into the mix. You start messing with price when you don't even know what is going on in your import fees to begin with.
[07:33]
Clifford
So hold tight, have a time machine, go back and make sure you've stockpiled inventory. If you haven't, if you have, pat yourself on the back.
[07:39]
Robin Clifford
I will say on the topic though, because we're on Amazon, there's a few like unique Amazon y things because we're on this big marketplace and you're stacked right up against the competition. And as any, as any great Amazon LinkedIn influencer will tell you, the Chinese sellers are the like you know, they're, they are the enemy on Amazon always. They are always the demon Chinese sellers who are cheating the rules always and using keywords you're not supposed to and they get preferential seller support help and things like that. Well, there's also rumors and thoughts that there's a lot of customs cheating that will be going on from Chinese sellers where they'll be lying on declared value forms and things like that. Because there's just not a lot of consequence. If you're not a US based company and you fraudulently lie on your customs declarations, there's not a lot of consequence back to you in China other than probably losing that shipment. I'm not saying do it, probably don't do it, but it does mean that if you are a US based seller who's shipping things in from China and you have a direct Chinese competitor, they might be a little bit more willing to bend or break the rules or change country of origin like a lot of different customs fraud things that you shouldn't do because you're an American based seller and you'd have actual consequences when they might not. Like a weird part of Amazon is that their price might not actually go up despite there being tariffs because a lot of people are finding loopholes or ways around things or shipping ingredients to a different country to get things put together last minute and that's called a transformation. So they ship it in from over there now and the country of origins change like a lot of hacky ways to get around it that are like on the verge of customs fraud that American based sellers 100% should not do. But internationally based sellers might be willing to try because they have less of a possible consequence. And then that that shows up right in the marketplace with prices going up for some and not for others.
[10:01]
Clifford
Interesting. The other thing I've heard from China is their ace in the hole is their patent fraud engine that they're warming up right now where they've sort of threatened to say hey, we could start producing iPhones at pennies on the dollar and flood your market with them potentially which could get ugly as well.
[10:19]
Robin Clifford
So it's a big problem on Amazon too of, I mean the reality is a lot of these products are made in the same factory. So they are just don't slap the brand label on them and instead send the product. But what gets even weirder is they can, I mean not to get too Amazon in the weeds but they'll throw it on the same listing on Amazon and say that they're selling the exact same product. It's like a, it's not, I don't know, I feel like it's not talked about a lot because it's usually not that big of a problem. Now that brand registry exists on site and you can report these types of problems. But back in the day it was a big problem where a counterfeit seller would just hop on your listing and take buy box by undercutting you and then you're. They're leeching all of the sales from your listing selling like a counterfeit item. It's a lot easier to counter these days with brand registry but it's a real concern that still comes up every now and then. And we still do report sellers probably monthly on a lot of brands from counterfeit sellers.
[11:21]
Clifford
What's interesting with these terrorists is they may be short lived but likely we're in the middle of a changing financial order. Like there's going to be fallout from this whether or not tariffs stick around. It's going to be really interesting to kind of keep reporting on how this changes the international economic order and the fallout for our industry. Okay, let's move off tariffs because we've.
[11:43]
Robin Clifford
Got another interesting topic we forgot about and we forgot to put in the notes also of the de minimis.
[11:49]
Clifford
Oh, let's talk to minimus. That's like isn't that just a drop shippers problem?
[11:53]
Robin Clifford
Oh, it's not just a drop shipper's problem. Yes it is a drop shippers problem and yes there are a lot of drop shippers on Amazon. There used to be a lot more. Another thing that Amazon's cleaned up lately. But there's a whole bunch of listings on Amazon. You'll notice it a lot more on Amazon, Canada and others like that where our shipping time is a long time, sometimes like two months. Those are drop shipped. It doesn't say it's drop shipped but those are drop shipped. But selling on Amazon. Let's say you're selling. I never have great examples. Water bottles, let's say not shoes, not Running shoes. Not running shoes. I can't believe I didn't use running shoes.
[12:34]
Clifford
You didn't use running shoes.
[12:34]
Robin Clifford
Okay, water bottles.
[12:35]
Clifford
I like it.
[12:35]
Robin Clifford
Just do running shoes.
[12:36]
Clifford
No, I was ready for something new.
[12:38]
Robin Clifford
Okay, let's say you're selling water bottles. Your cost of goods on the water bottle might be a dollar a pop, let's say from China. Then your declared value on let's say a pallet worth of water bottles might only be $600, $700. You were under de minimis. That is now a shipment that does not need to pay tariffs. If they were, if there are tariffs or customs port fees or whatever else, you would be levied by being a normal shipment. Now, typically large brands don't do this. They ship in like a container at a time or five or six pallets at a time. So it's never under that $800. But a lot of sellers on Amazon will ship one pallet here and one pallet there and one pallet here, one pallet there, and they're just sticking them under $800 of value because the advantage of that outweighs the disadvantage of sending it in separate shipments. So for a lot of sellers, and this is a big thing for in like the private label community, a lot of those sellers are going to experience quite a bit of pain here in being able to restock their Amazon, because suddenly there's a whole bunch of stuff they haven't had to deal with before. And that's not including the massive backlog of packages that's going to happen from de minimis going away. Because I think I saw a stat that there is a billion individual packages that hit the US every year that are de minimis exempt. So all those ones that are coming from China are now not de minimis exempt, meaning someone has to look, or at least a computer or something, however it works, has to look at the value of that and assess a tariff or assess the goods and look at them and whatnot when they wouldn't before. That's a massive job. And I don't think there's been a huge hiring of customs and border examination agents lately. So that's going to cause a huge backlog in everything coming in.
[14:47]
Clifford
And AI can't just do it yet. Just like all the manufacturing jobs that the US is going to be reshoring, um, problematic. So, and so de minimis now would just be subject to whatever tariffs are subject to the country, whereas before they would have been exempt.
[15:02]
Robin Clifford
Now even it gets really weird because if you're sending in Like a very classic the dropship. For example, if you bought something like a water bottle that's like five bucks on Temu, that $5 water bottle on TEMU not only has the tariff assessed, you now have a customs broker fee because customs broker had to do something, someone had to look at it, and you have to pay a fee for the customs broker to do that work. And they assess a fee on top of it. And that fee is probably like the the same value or more than the entire purchase value. So the tariffs are small in that sense because they're assessed on the cost of goods. But the actual like fee that you're paying because of the just the work and time that has to go into it is actually pretty substantial probably.
[15:46]
Clifford
What a time to be alive. Let's talk about finding the balance between spend and organic ranking.
[15:53]
Eric Dick
Okay, so this is all about trying to find the perfect balance of like spend and rank. And what we're noticing, or Clifford's been noticing on some products, is that a higher level of spend is actually harming organic rank for that term. To the extent that removing spend on a term actually one is an Amazon's Choice badge. And the theory goes here that your organic rank and your Amazon's Choice bet, which isn't just based on volume, but also on performance, specifically conversion rate. So as you push incremental spend that actually hits a audience that is converting less, therefore hurting your overall conversion rate and then therefore hurting your organic rank. Because you're not showing Amazon as positive as a metric or as positive as a customer experience. Whereas if you reduce spend and you hit the high converting audience, you maximize the positivity of the metrics you're showing Amazon, you maximize your rank, you win the Amazon's Choice badge. So finding that balance between what is the actual correct level of spend to not lose sales, lose ground, have competitors move in, but what's not too much spend that you're actually harming the organic rank has been making Clifford pull his hair up for the last couple weeks. Did I explain that right?
[17:11]
Robin Clifford
No, that's perfect. And it's exactly the case is or moving spend up and down on products that this is especially noticeable if the product is somewhere in like the low teens to single digit rankings. So somewhere kind of in the upper end of that first page for the search result you're looking for for that search term very clearly. Seems like we never know for sure, there's so many variables. But it sure does seem like decreasing the Spend organic ranking increases. Increase the spend organic ranking decreases almost Seems like a very clear inverse relationship there. The theory is the conversion rate and click through rate. But it also means like now you have to look at other tools, other methods to try to push up your conversion rate. Maybe now you do more promotions, coupons, sale prices, instead of spending more because that will increase your conversion rate more. So maybe those ad spend dollars go into sale prices. Though if you look at that from a business standpoint, a lot of brands won't want that because you'd want to sell at a certain level and your marketing budget goes in this other pool and your revenue is in this other pool. And if you do, a sale price actually comes out of your revenue and not out of your marketing budget. So when it comes to things like trying to sell your brand, usually not the best. So you end up in this weird scenario where if you really try to push spend, you're hurting organic ranking, which is kind of the whole point of what makes Amazon profitable in a lot of cases is that organic ranking and the results you get from that. And with so many more ad placements on Amazon than there was in the past, like three, four years ago, organic was huge on Amazon. Nowadays there's an ad at the top, there's an ad below the top, there's an ad just under the first row of organic. There's ads everywhere. So if you don't spend heavily into ads, you're now not in any of those extra placements just to kind of maintain that organic placement, which is free and gets you really good sales. But maybe the top sales actually in your certain search term especially. My theory is older people click the ads more. So especially if you're in a niche, it's probably older people. Those ad spots might actually be where the top revenue goes. The most clicks might actually go to the ad spots instead of the organic spots. So you're getting free sales there, but you're giving up all of the top line sales there. So you're trying to find this weird balance between like not hurting your top line rev, but also not hurting your organic ranking. So you end up spending somewhere in the middle. That hopefully keeps your organic ranking up, but doesn't hurt your top line rev too much by giving up all of your ad spend. Or maybe you're only running a certain ad type like a video at the top, but you're not running a sponsored product below. Seems to really depend on the search term, how aggressive competition is with spend and stuff there. It's very dependent on category, but it's not just as simple as it Used to be of like just show up at the top as much as you can and the sales will give you organic ranking and then you'll be number one ad and number one organic and everything is groovy. It's a really old word and very.
[20:30]
Clifford
Old word for a young man and. But you are like in your experimenting with as you say or pulling your hair out as Rob mentioned. And then like how much are you lowering ad spend? And I guess it's going to be on a total case by case basis. But. But like just to give the audience like a range. Like what are the ranges you're kind of experimenting with to lower things.
[20:51]
Robin Clifford
Good question. I would say there is like on a specific search term, let's say we spent $12,000 a week previously on that search term. Pretty big search term. That might come down to 6 or 7,000 the next week and then we'll see organic ranking. Follow it up nicely on other cases. In the past months, fully cut spend to some other top search terms and their organic ranking has skyrocketed to like number one or two and just held there the whole time. And we've not resumed spend. We found like I think there's like some really good cases where if you have a catalog of products that apply to that term, you can own some of those search spots with other products. So you kind of like clog it up with the rest of your catalog. But then you have your one product that you're actually trying to rank and you don't spend on that one. So that one ranks up organically. But then you're clogging up the ad spots with the other stuff. So if someone clicks they're still going to one of yours. So you get the ad spots and the organic spots. So you could do something like that. That's like kind of where we've ended up.
[21:58]
Clifford
It really sounds like it depends on your ratio of organic to paid in a lot of ways. And you don't want it if you, you don't want to dilute. Yeah, you just don't want to dilute your organic love that your product gets organically by sending a bunch of paid. You can't. Astroturf I guess is kind of the idea you got to keep, keep things organic. Keep, keep that real connection you have with your customer.
[22:17]
Robin Clifford
And it's weird because you'd think they're searching the term. You know they're there, they're on the site, they're searching your best search term. They should be buyers. But I guess there is a level of Amazon really does know the customer enough that if you're paying for the ads, they're putting you in front of the customers who are searching that term who are less likely to buy you. And if you're not buying the ads, your organic goes to more relevant shoppers who search the term. Somehow they know out of the 10,000 people that search that term that week, 2,000 of them are really relevant and maybe 8,000 of them aren't. Somehow in Amazon's weird background data, an.
[23:00]
Clifford
Example of a platform deprioritizing ad spend, you don't see it very much that you'd think they just want you to spend as much as possible.
[23:08]
Robin Clifford
Oh they do, yeah, to a degree.
[23:11]
Clifford
As but they, they aren't willing to jeopardize that. You know the organic connection I think.
[23:17]
Robin Clifford
Are the kind of working theory is there are two completely not completely separate, but they are two like separate teams or separate algorithms that are ranking them. They affect each other but the organic team prioritizes these metrics like click through rate and conversion rate whereas this paid team kind of just prioritizes sales and ad spend. So kind of two separate forces working against each other. And I, I would assume they don't even talk to each other. Honestly they shouldn't. It's probably best for everyone if they don't talk to each other.
[23:47]
Clifford
Church and state. Very cool. Well very two interesting top I think we covered tariffs for Amazon in an interesting way today. I think this is a great topic. Last note. Amazon prime day in July is four days versus how many? Three used to be three used to be two. It's doubling double those prime days. Pump those pump, pump it up.
[24:05]
Robin Clifford
There's a prime spring. There's now a four day prime day in July. There's a prime fall. Black Friday. Cyber Monday was 12 days last year. We're getting there.
[24:15]
Eric Dick
Yeah. One of our clients made the joke that one year will just be all year will be prime. Just the prime year.
[24:22]
Clifford
Optimus Prime. Very cool. Have you guys watched anything good on prime lately?
[24:27]
Robin Clifford
I have not rewatching Parks and Recreation again?
[24:30]
Clifford
Oh, always good. Always. I just got back from Las Vegas last week and I won a thousand dollars on a Texas Hold'em table. Cleaned out a bunch of other degenerate gamblers and it felt great. Closed down a casino. Felt like a real rounder. Stayed up all night for my flight home and then I came home looking for like more gambling content and I saw that there was a movie like in 2020 with Ryan Reynolds called Mississippi Grind and it's about two degenerate gamblers making their way throughout the United States. It's quite an entertaining movie. I ended up doing some as I do when I watch all movies now. As I was doing some chat gpting, I found it is one of the most horrendous bombs ever made in that it costs like over 20 million to make and made something like $300,000. So as far as gambling goes, it was not a good gambit, but it was quite an entertaining movie. Highly recommend it for anyone out there.
[25:17]
Robin Clifford
Never heard of it. So that makes no it's got Ryan.
[25:20]
Clifford
Reynolds and I know he's not very he's not as as popular right now due to some personal life choices, but still a good actor. So is Ben Mendelsohn, who's in it. I recommend it to everyone out there. I that was totally non sequitur. Just made me think of Prime. So go check it out. Put it on your list of movies that people tell you to watch that you'll probably never watch.
[25:39]
Robin Clifford
Watch the ads when you watch it too.
[25:41]
Clifford
Watch the ads. Oh, I just found out that Netflix, or is it Netflix, is going to start doing ads? No, it was Spotify is going to start putting ads on their platform for people that pay because they're going to create a super premium category for to have no ads. And it's like they're. I know I'll be so I'm I I like their algorithm so much. But if they start doing like this Spotify don't do it. You heard it. You heard us here.
[26:04]
Robin Clifford
We know there's a fun story. My We've had Prime video for like obviously a long time and they've added this same thing. They added the like ad tier and then the pay an extra little bit and you don't have ads. But I kept ads on because I wanted to see the ads, buy ads. But my wife was rewatching like all of Handmaid's Tale and she was in like the end of season two or something. You know, it's like she's been watching like 20 episodes of the show and I was sitting there watching like the end of this episode with her and ad starts playing. I'm so sick of these ads on Prime Video. How much does it cost to get rid of them? I was like, oh, I think it's like $2, I think a month to get rid of the prime video ad. She's like, what? And so she immediately made me buy the ad free tier of Prime Video. So now I no longer see the ads, but it was a pretty funny like we were saving two bucks just so I could see the ads. But I wasn't even watching the show. She was watching it and watching the ads.
[27:02]
Eric Dick
They lost me as a prime video viewer when they added ads.
[27:06]
Clifford
A principal, a principled ad man. Love to hear it.
[27:08]
Eric Dick
Not really. Not much I want to watch anyways.
[27:11]
Clifford
That's fair. Increasingly. Cool. Well, thanks again, guys. We'll talk again soon. Thanks for listening to today's episode. If you're not getting the DTC newsletter, you can subscribe for free at directtoconsumer Co. And if you want to learn more about Pilothouse's all killer no filler services, take off to Pilothouse Co. I'm Eric Dick and this has been the DTC podcast. We'll see you next.