Today’s guest post comes from filmmaker Jed Riffe who I met this year at Slamdance. He told me that he was surprised at how little money filmmakers make selling their films through Amazon and that he had a system that maximized return from Amazon sales at 80%. I of course immediately asked him to write a post to tell other filmmakers how to do it – and he has generously obliged:
There are two main options that I use to sell DVDs: 1) Self fulfillment for the orders from my websites. 2) Self fulfillment for the orders from my Amazon. I don’t use Fulfillment by Amazon and I will tell you why:
Self Fulfillment from sales on my websites:
I have three documentary film websites that sell DVDs directly to customers (www.jedriffefilms.com) and a consumer can go online to my websites, read about each film, see one or more trailers or clips and if interested, purchase a DVD. On my websites I sell DVDs of my seven, nationally broadcast documentaries for $24.95 plus $10 Shipping and Handling and any applicable state sales tax. I use Paypal as my shopping cart and pay them a fee of $1.31 or approximately 3.75% for each sale. It is easy to fulfill these orders myself. I drop the DVD and a list of all the films in the Jed Riffe Films Collection in the mail and it is done. I spend .25 cents for the mailing envelope and $1.92 in postage and pocket the rest $31.47.
While the return on each sale is substantial I sell ten times more DVDs on Amazon.com than I do on all my websites combined. This is because video and film consumers look to Amazon as their first choice for purchasing DVDs online.
I am always surprised when I hear how little income some independent filmmakers are getting from selling their films online on Amazon.com. However, there is even more than money at stake here. The names and mailing addresses of each purchaser are almost as valuable as the percentage we receive from each DVD sold on Amazon.
There is one major way to maximize the amount you can get from Amazon and that is DIY self fulfillment. Before you start saying how busy you are making films, raising the money for your next film and that you are a filmmaker and not a distributor, think again.
Self Fulfillment from sales on Amazon as an Individual Seller and or Amazon Professional Seller Merchant Account Vs. Fulfillment by Amazon:
There are three main options for selling products on Amazon. The first is as an Individual Seller. The second is as a Professional Seller in the Amazon Marketplace. The third is Fulfillment by Amazon (FBA) where Amazon actually stores the product and sells it. While FBA allows people to buy direct from Amazon and not an alternate vendor (thereby taking advantage of Amazon Prime shipping and customer service), I prefer selling directly as an individual rather having my own professional merchant account on Amazon Marketplace or FBA and here is why:
Fulfillment by an Individual Seller on Amazon:
If you want to receive the most from each DVD sale on Amazon, and you want to capture the mailing address of each purchase then you have to set up the listings so that you fulfill it yourself. It takes me less than 3 minutes to go online, confirm shipment, copy the mailing address into my address book, then to an Avery label, put the DVD and sales sheet into the envelope and put on four “Forever” (.44 cents) USPS stamps.
For doing this, in addition to capturing the mailing address of the consumer, I receive $22.40 for each sale. The buyer pays $24.95 plus $2.98 as a “shipping credit” which is a little more than the actual price of postage that also covers the shipping envelope and label.
As an Individual Seller you can “manage inventory” modify your listing and do everything except set up a title that does not already exist on Amazon. The Individual Seller accounts costs .99 cents plus a referral fee for each sale. .
Selling and Fulfilling Yourself on Amazon Marketplace with a Professional Seller account:
The difference between selling and fulfilling as a Professional Seller on Amazon Marketplace and an Individual Seller is that the Professional Seller account costs $39.99 a month plus a small referral fee. The only reason I ever sign up for the Professional Seller (Merchant) account is that I am listing a new DVD that is not already for sale on Amazon. If this is the case you are forced to sign up as a Professional Seller for a month to list new titles but you can cancel it before the next billing cycle. A Professional Seller account works well if you sell a minimum of 40 DVDS a month. If you don’t sell at least 40 a month then the Individual Seller is more cost efficient.
Fulfillment By Amazon as an Individual Seller or as a Professional Seller:
If you do NOT want to maximize the amount you get from each sale and lose the ability to build a mailing list to sell other films and products to you can let Amazon fulfill it for you. You get less than 50% of each sale ($12.48) for each DVD Amazon fulfills instead of a net of 79% or $19.62 each. You can find out more about Fulfillment By Amazon
When I have a new DVD coming out or I am touring with a new film I mail the folks who purchased my films to let them know it is available. This always brings new sales.
By using this DIY strategy I am not only getting more for my work I am building a base of supporters that I can appeal to using social media AKA crowd sourcing. A good example is Kickstarter. The people who by my films are the first people I invited to make a donation.