A Toy Amazon FBA Brand Deep-Dive: Montessori Mama

In this issue of the Amazon FBA deep-dive, we are analyzing Montessori Mama, a niche FBA brand in the children’s toys niche.

For those who are unaware, Montessori is a style of education that has been rapidly growing in popularity over the past few years. A growing niche like this represents a big opportunity for well-executed FBA brands.

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The estimated monthly revenue for this brand is $84,000/month (million dollar annual revenue run rate). We estimate it could be increased by 25% with these easy wins.

This is what we cover in this deep dive:

  • Business Summary
  • Highlights
  • Setbacks
  • 3 Easy Wins to increase revenue
  • What is the exit valuation of this brand?
  • Actionable takeaways

Let’s get into it!

Montessori Mama Brand Overview

Originally founded in 2019, Montessori Mama currently has 10 products live on Amazon. Their best selling listing is their wooden puzzles which has over 2,600 reviews and is estimated to be doing $46,500/month in revenue.

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✅ Highlights

  • Multiple established listings in a growing category
  • Every product has a 4.5 star rating or better
  • All products are lightweight, easy to ship via sea or air

❌ Setbacks

  • 50% of revenue comes from the top listing. 80% of revenue comes from the top two listings.
  • Large revenue concentration – if something happens to the main listing, revenue would go to 0 instantly

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There are opportunities to significantly grow and differentiate this brand. We break down the following wins:

  1. Add a video to each listing
  2. Cross sell other variations through Sponsored Display and bundles
  3. Implement Amazon advertising strategy to expand marketshare.

Let’s get into it!

➡️ Win #1: Add a video and Enhanced Brand Content to the Amazon listing

Montessori Mama is doing a lot of things right on their listing with strong images, SEO optimized title/bullet points, Enhanced Brand Content, and a Brand story.

However, they are missing the significant opportunity to add video to their listing. Adding a video will improve their listing conversion rate and allow them to use Sponsored Brand videos as an ad unit.

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For this specific product, I would utilize influencers either through direct outreach through Youtube/Instagram or using a service such as Billo.

An unboxing video showing the product and how kids interact with it would function well for both purposes (listing and Sponsored Brand video).

Takeaway: Add a video to the core listings using an influencer to increase conversion rate and increase your presence on Amazon. We estimate this could increase conversion rate and revenue by up to 15%.

Win #2: Build out Amazon Store and use Store Spotlight Campaigns

Every brand that has more than 3-4 related products should be building out their Amazon store and using Store Spotlight campaigns to drive traffic to it.

Currently, Montessori Mama’s store is simply all of their listings on the main page.

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What I would do is separate them by category – wooden puzzles, activity cubes, sensory toys, etc. This will allow you to treat each page like a landing page.

Then, you can use Store Spotlight campaigns and target very top of funnel keywords such as “montessori toy” and “educational toys for kids”.

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Directing the traffic to the store will result in higher conversion rates and reduced CPCs.

Takeaway: Building out your Amazon store is a great way to showcase all of your products if you have a large product catalog and each product is related. We estimate using Store Spotlight campaigns and directing traffic to the Amazon store could increase revenue by 5%.

3. Advertise newer and/or weaker products on their core listings

Montessori Mama currently has two listings doing over $10,000/month. Each of these listings gets thousands of visitors to the listing every month.

However, the rest of their product catalog is fairly weak with most of the products doing <$5,000/month.

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They are already using their Enhanced Brand Content and Sponsored Product defense ads to advertise these products. However, they could also

  1. Create virtual bundles
  2. Add promotions and a promotion image to the core listings

Virtual bundles are well understood and a great way to bring visibility to different products in your catalog and increase your average order value.

I would also add a promotion to incentivize buying an additional product from Montessori Mama. Promotions, by default, are fairly non-descript on the listing page so I would also add in a secondary listing image advertising the promotion.

This listing image could show the entire family of Montessori Mama products with a headline such as “Buy two or more of your products and get 10% off”.

Takeaway: Using the existing hero listings to cross sell the weaker products could increase overall revenue by 5%.

How Much is Montessori Mama Worth?

Montessori Mama has an assortment of well branded products in a growing category. While it currently has 10 listings live, two products account for the majority of the revenue.

There is also the potential to introduce multiple new products in the niche.

As they say “a rising tide lifts all boats”. In this niche, Montessori Mama is in a great position to ride the wave and eventually exit for millions of dollars if they continue executing.

Montessori Mama is currently estimated to be doing $84,000/month which equates to just over 1,000,000 per year in revenue. Given the niche and products, I’ll assume a conservative net margin of 20%. That gives an annual profit of $200,000.

Valuation: With a strong position in a growing category, Montessori Mama deserves a stronger multiple than usual. Although multiples have been down significantly in 2023, this brand could be worth 3.5-4x profit equating to a valuation in the $750,000 range.

If I was running this brand though, I would NOT sell right now. This brand has the potential to exit for multiple 7 figures if they continue to launch new products and increase their marketshare in this category.

Actionable Takeaways

Here are actionable takeaways that you can apply to your business today:

  1. Look through your current catalog and at your current Amazon store. Can you use your Amazon store as landing pages? Store Spotlight campaigns represent a great way to drive traffic and they see increased conversion rates when you show customers multiple products.
  2. Take 1 hour today and look at your niche and brand as a whole. Where do you see the category and your specific brand in the next 2-3 years? Often, it takes at least a year just to prepare for a sale and going through the actual sales process can take 3-6 months. Position yourself accordingly depending on your goals.

Analyzed by Jon Elder

Jon has sold over $10 million in sales on Amazon since 2014 and exited 5 Amazon brands for millions. He now helps Amazon sellers experience the same level of success through 1:1 coaching. He is happily married with two kids in Texas!