Ross Greenwood speaks to Adam Mills, co-founder of KoalaSafe, about why they sell on Amazon as Amazon Australia is set to go live
Introduction: When will Amazon Australia go live?
Ross Greenwood: Welcome back to Money News right around Australia. Now, I did tell you early this week that I suspected that Amazon in Australia would be launching itself sometime later this week. Well it seems, according to reports that could be true. The reason for that is that Amazon market place, which is basically the platform that it’s got where local businesses go and subscribe, it’s almost 50 bucks a month, and then also they give a share of their revenues back to Amazon. Whenever they sell a good, Amazon takes a clip of the teacup.
That Amazon market place is likely to be up and going by the end of this week. Now, the reason why the end of this week is important, is because it’s Black Friday in the United States. The day after Thanksgiving, which is Thursday US time is actually followed by Black Friday which is the massive cyber event. Now, what it is, is it’s a huge sale online. One of the big sales events of the year and of course it’s in the lead up to Christmas when people do most of their buying. Now, Australian retailers and Australian companies have an ability to try and tap into some of the demand for those products by getting some of their own products up onto the Amazon site by that time.
The question is how do you do it, why do you do it? Last week you may be aware that Amazon held a massive market place sort of symposium for a lot of potential companies and retailers about putting their goods onto the Amazon site and take advantage of the huge distribution it has. Well, amongst those companies there was a co-founder and chief technology officer at a company called KoalaSafe, Adam Mills. He was there, and he’s online right now. Good day Adam, how are you doing.
Interview with: Adam Mills, KoalaSafe, Co-Founder
Adam Mills: Good day Ross, thank you
Ross Greenwood: Good. Did you get a letter saying to get all action station ready to go by tomorrow?
Adam Mills: We got a letter today there’s a trial tomorrow, whether we go live to everybody or not, we don’t know. But we have to be ready to be selling tomorrow. So it may be or may not be.
Ross Greenwood: So, it’s going to be pretty fun. Just explain to people what your business is and what it does.
Adam Mills: Yes, KoalaSafe helps parents manage their kids internet usage. It’s a small device you plug into your internet at home, connect to all your kids’ devices and then you can control how long they’re online and what they do when they are on line.
Ross Greenwood: So does you product benefit from being, say for example, involved with an organization such as Amazon. Does it give you greater distribution?
Adam Mills: Yes, usually. Amazon helps us sell into 25 countries around the world, and it gives us access to their 300 million visitors each day. It really boosted our sales when we got onto the market place.
Ross Greenwood: And you are selling a physical device, do you use Amazon to also distribute it for you or do you distribute it yourself?
Adam Mills: We use SPI to distribute wherever they have it possible, and it works really well. We love it. In Australia we use a third party distributor, and we’ll swop over to Amazon when it comes.
Ross Greenwood: Okay. The other part about this also is quite clearly you have to give up a part of the revenue back to Amazon. So it’s not dissimilar to a big shopping center owner, that might take a slice in terms of rent that is coming through the door. In this particular case, it’s actually a slice of your revenue. Can you justify it by the greater number of sales, the amount of foot traffic, if you like that goes through the Amazon site.
Adam Mills: Yes, 100%. Our percentage that we give Amazon is 8%, and that’s all public information. If you compare it to what it costs to be on a retail shelf, it’s a good deal.
Ross Greenwood: Just in regards to other companies in Australia that might end up on this Amazon site because this is really the beginning for Amazon on a commercial basis here in Australia, just explain what their experience might be. Because this is about trying to get Australian consumers or is it about trying to get to global consumers?
Adam Mills: From a business, you want to be a global business. You can sell on all their platforms around the world. But this launch is specifically about Australia. And from Australia’s consumer point of view, they get a wide selection of products in one place online which like you likened it to a mall whereas instead of at the moment you have to go to each shop individually. Online, you can go to one place and have the expectation that everything that you’re looking for will be in one place.
Ross Greenwood: But what you’ve presumably done presumably, Adam, from what you’re telling me is you’ve put your business up onto Amazon sites around the world so you could go to the UK or the US wherever it might be. And by doing that you can ultimately become a multi-national company, even though you might be based in Australia and not necessarily be the biggest company in the world.
Adam Mills: Yes, exactly. We have customers in 35 countries. We now sell in 25 countries but most of those are Amazon countries. We’re in the UK, we’re in the US, we’re in Europe and all that’s done from here and an office in the US.
Ross Greenwood: Do you believe Adam that you would have been capable of doing that without having that platform through Amazon because there’re nothing quite like it, is there?
Adam Mills: No. There’s no way two guys in Australia could have shift and distributed to 35 countries from day one with the resources we had at Amazon.
Ross Greenwood: Just out of interest, you have had a crack at T mall, Alibaba in China to see whether there’s applications for your device there?
Adam Mills: For us in particular because we’re a technical device, the great firewall of China causes us a few problems. We haven’t gone into the Chinese market just yet.
Ross Greenwood: It is really interesting. Adam Mills is basically standing by, waiting for the instruction to say he can go live with Amazon here in Australia. Many people suggest that, that could well be tomorrow. As he says, he’s not given too much away but you get a sense that he’s ready to go and it could happen at any moment. Most likely tomorrow according to my information. The co-founder and chief technology officer at KoalaSafe which is the company has a device plugs in to your internet at home, that allows you to monitor and also if you like restrict the usage of kids internet at home.
Adam Mills, I appreciate your time here in the program today.
Adam Mills: Thank you very much.
Ross Greenwood: There you go. Interesting story there. The whole Amazon thing, because it’s not just technology. It could be blackberries, blueberries. It could be– Just about anything. Socks, does anybody make socks in Australia. I don’t think anybody make socks in Australia anymore, do they? Jumpers, whatever you like. You can put it on their platform and get to a very big audience very, very quickly. As I say, I think it goes live tomorrow.
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