Category: Product Research

3 Creative Ways To Generate Amazon Product Ideas

Don’t you hate it when you’re ready to source your next Amazon product but you cannot come up with any good product ideas? Same.

By using Viral Launch’s new Market Intelligence tool, you can research and validate your product ideas through an in-depth analysis of different product markets. But, what good is a product research tool without any product ideas?

We’ll walk through some creative methods for generating product ideas, and by the time we’re through, you’ll have an extensive list of potential product markets to plug into Market Intelligence! With just a little bit of time spent brainstorming, you’ll be on your way to sourcing your next gold mine.

How to Generate Amazon Product Ideas

Before brainstorming product ideas, it’s important to understand the basic criteria of a successful Amazon product.

Good products to sell on Amazon are typically:

  • Small, light, and durable for lighter shipping and manageable returns.
  • $10-50 typically for good sales numbers and margins on Amazon.
  • High-margin for a good return on investment.
  • Niche for a more specific audience and potentially higher conversions.
  • Not dominated by a name brand for more opportunity to grab market share.

These are just guidelines for your thought process but don’t feel like you need to stay inside a box of specific criteria. If you think of a heavy product with great margins, that product may be perfect for you. Now, you’re ready to brainstorm ideas.

We’ll go over three creative techniques to help you generate product ideas for Amazon FBA.

  1. Alibaba Catalogs and Storefronts
  2. Niche Discovery Method
  3. 10 Ideas Each Day

Alibaba Catalogs and Storefronts

Right now in China, a supplier is manufacturing a product that has potential to make you thousands, maybe even hundreds of thousands of dollars. It’s just up to you to find out what that product is!

A great way to discover product ideas is by looking through a supplier’s complete product offering. This can be found in the supplier’s catalog as well as on their Alibaba.com storefront.

First, send a message to Alibaba suppliers asking for their product catalog. Contact suppliers by running a search for any product and then clicking the Contact Supplier button.

Here’s the message I sent to about 5 or 6 suppliers:

Hi there,

Can you please send me your product catalog? I’m interested in sourcing a product, and I would like to look through what you offer first. My email is example@gmail.com. I’ll look forward to seeing what products are available from you.

Thank you.

Send a similar message, and you’ll get a document back containing every product offered by that supplier. This is a great source of product inspiration! For example, a knee brace manufacturer sent back a multi-page document showing everything they offer. Here’s one page from their catalog:

From this catalog, I found other product ideas, such as gymnastics grips (★★★★), lunch bag (★★★★), doormat (★★★★), and shin guards (★★.5). Many catalogs have a similar layout, and others will be a spreadsheet containing details about each product.

The product ideas you’ll get from catalogs may not all be home runs, but looking through everything a manufacturer offers is a great way to get your creative juices flowing. Once you’ve got a list of potential product ideas, plug them into Market Intelligence to discover which markets are duds and see if you’ve come across a gold mine.

Another similar method is to visit storefronts on Alibaba.com. Find these by clicking on the Supplier’s name in search results.

On the supplier’s homepage, you’ll see the products they offer. You can also navigate their products by the Product Categories tab.

As you’re combing through the storefront, you can plug the product ideas into Market Intelligence to research the market and determine if it’s a good fit for you. One cool feature of Market Intelligence is the ability to run multiple searches, up to ten, at once!

You may find that some markets are oversaturated, but with enough searching around, you’re sure to find your next money-maker.

With this method and the storefront shown above, here are some of the products I came across and did some quick research on: cosmetic bag (★★★.5), card holder (★★.5), ice bucket (★★★.5), and inflatable travel pillow (★★.5).

Niche Discovery Method

Put your thinking cap on. It’s time to discover some Amazon product niches. This method can help you find smaller product markets within more popular categories. You may find some golden nuggets, and you’ll likely come across some really goofy products. But bear with me here – sometimes finding the perfect niche requires thinking out of the box.

  1. Collect Items

Get up, and go grab 7-8 items that fall within our “good Amazon product” specifications. As a reminder, those are products that are small, light, durable, $10-50, high-margin, niche, and not dominated by a name brand.

Today in the office, I’ve picked up a water bottle, straws, yoga mat, coffee cup, gloves, scissors, and a laptop case.

  1. List Adjectives

Once you’ve got your items, get out a piece of paper and a pen. Write down ten common product adjectives. You can choose your own, or you can use these examples:

  • Mini
  • Large
  • Bulk
  • Travel
  • Personal
  • Industrial
  • For Kids
  • For Men
  • For Women

  1. Search Combinations on Amazon

run a search on Amazon for each product that you collected in step one, with each adjective attached to it. For example, I’ll search mini scissors, large scissors, bulk scissors, travel scissors, and so on. These search terms may seem a bit odd, but trust the process 🙂 Sift through the product results to see if you can identify a product niche within that search… maybe a product that you haven’t thought of before.

Don’t be afraid to veer off the path as you click through products and niches. You may just run into the perfect product opportunity.

When sifting through the search results for bulk scissors looking for interesting niches, I came across products like scissor caddy, rolling scissors, and desktop organizer. These are all potential markets that I wouldn’t have thought up on my own.

Here are some additional niche product markets that I came across in my searches:

Write down your list of niches. Now, some of these products are going to be horrible products dominated by huge review numbers or marginal sales. But that’s ok. Not every idea is going to be a home run.

After using this niche hunter method, you’ll have a solid list of product ideas for your Amazon product research. I even found a 5-star product 😉

Plug your ideas into Market Intelligence, our Amazon product research tool, and see if you’ve come across a winner. You’re now one step closer to determining what to sell on Amazon!

Want a tougher challenge? Head to your local Walmart, Walgreens, Target, or Home Depot and jot down the products you see that may be a good fit. Use Market Intelligence on-the-go on your mobile device, or go research-crazy when you get home!

10 Ideas Each Day

“You have to come up with a new way of thinking. A new way of having ideas, a new way of interacting with the outside universe. You’re in crisis, it’s time to change. Time to become an IDEA MACHINE” – James Altucher

James Altucher is a best-selling author, entrepreneur, and venture capitalist. Years ago, he found himself at rock bottom, so he started coming up with ideas to make a change. He would take his waiter’s pad, go to a cafe, and write down 10 ideas each day. Some were business ideas, some were book ideas, some were solutions to problems he faced. In doing this, James strengthened his “idea muscle,” and the results were twofold: he could always come up with ideas when he needed them, and he came up with some really good ideas.

To help you brainstorm Amazon product ideas, I want to challenge you to strengthen your idea muscle. You’ll come up with good ideas, and after some time, you’ll be a more creative thinker. Sit down each day without distraction. Pick a category, and write down 10 product ideas.

While this may seem easy, but you may discover that around number 6 or 7, your “brain starts to sweat,” as James puts it. Think about it: when you work out at the gym, the muscle-building comes after you’re comfortable. If you stop lifting the weight when it starts to hurt, you won’t see results. When you’re brainstorming, get past the difficulty and push yourself. And this is where you may find some of your golden nugget ideas.

And just like working out, you must make it habitual to make any sort of difference. Challenge yourself to do this every day, and after lots of practice, you’ll become an idea machine. Of those hundreds of ideas, you’ll likely find some ideas for good products to sell on Amazon after a bit of Amazon product research using Market Intelligence!

Here are some categories to get you started:
  • Coffee, Tea & Espresso
  • Pet Supplies
  • Camping & Hiking
  • Computer Accessories
  • Storage & Organization
  • Office Supplies
  • Sports & Fitness

Research Your Amazon Product Ideas

After you’ve gone through these exercises, you should have a list of potential product ideas. Now, you’ll want to do some extensive research to determine which products will make the most sense for you and your Amazon business.

To understand whether or not a product market has potential, you’ll want to take many factors into consideration. These include, but are not limited to: average monthly sales across the market, possible monthly sales if you were to source this product, the sales/review ratio, sales trends, price and review count trends, the best selling period, and the number of reviews needed to sell well.

Sounds like a lot of research? Well, it is. It is crucial to do your research and understand a market before jumping in. If you go in blind, you’ll likely be blindsided and unsuccessful. But, if you know what you’re getting yourself into, you’ll set yourself up for success.

Luckily, Market Intelligence conveniently places all of the necessary information at your fingertips. You’ll understand where the market has been, where it’s at today, and where it’s headed. Recognition of potential downfalls, trends, and crucial data pays off considerably. After looking through Market Intelligence, you’ll be confident in your decision to source or walk away from that product.

Check out Market Intelligence for free and take the next step towards sourcing your next home-run product!

Your Amazon Sales Data Is Costing You Thousands

The foundation of a successful Amazon business is great Amazon sales data. How’s that, you ask? Well, in order to have a successful Amazon business you have to have great products. And in order to source great products, you need to be able to identify great market opportunities. You need accurate and comprehensive Amazon sales data. We have hundreds of sellers come to us each month asking for help with their business. And why are they struggling? Poor product selection. Many of them have gotten into insanely competitive markets and don’t have the budget to achieve success. Others sourced products where they were forced to lower their price and now sell with razor-thin margins.

Many of these sellers even used a market research tool to determine whether or not to source. So what went wrong? Their Amazon data wasn’t giving them an accurate picture of the market. Most software is grossly inaccurate, calculating estimates using a single snapshot of BSR data 

Where Other Amazon Product Research Tools Are Lacking

Snapshot Data

Most tools that use the Amazon Best Sellers Rank as their indicator for estimating sales are relying on the brief snapshot of what BSR is RIGHT NOW. Those tools are estimating sales over the last 30 days, based on a metric highly influenced by the last 24 hours. Using Snapshot data to analyze performance is like looking at a still frame of a movie and trying to predict the plot. It can be extremely inaccurate. As we discussed in our blog post covering the Amazon Best Sellers Rank, BSR can vary drastically hour to hour, day to day, month to month, etc.

Using a product’s BSR to estimate sales can make a market look awesome one hour and completely different 12 hours later.

  • Do you do your product research primarily on the weekends? Be careful. Consumer buying behavior in some product markets will affect BSR and those snapshot estimates over the weekend.
  • Do you do your market research primarily in the mornings? Again, be careful. Some markets see higher sales in the morning hours, meaning BSR will be lower. That means that tools with snapshot estimates will show higher sales volume than they would if you did your product research at night.

To accurately estimate sales, you need to take into account all the fluctuations of BSR that occur throughout the month.

Have you ever tried doing product research during November and wondered if the estimated sales numbers were inflated due to holiday sales or if those numbers were consistent throughout the year? Perhaps you have done research on some of the weight loss products during January and February when sales are much higher than they are throughout the rest of the year. There are tons of consumer buying trends you may not be intuitively aware of, so how do you know the likelihood of your estimated sales numbers remaining consistent across time? 

Not knowing how sales are trending across a market as a whole is dangerous when sourcing a product. To not have a complete picture of how sales trend throughout an entire calendar year for a product is kind of insane when you consider the amount of time and the thousands of dollars you spend getting initial inventory, creating a listing, and trying to gain traction.

ASIN Focused

Don’t look at just one ASIN. While some sellers may be well aware of this common fallacy, we’ve seen plenty who have unknowingly made this critical mistake. When doing research to determine which product markets you want to get into, you should be focused on the performance of the market as a whole, not a specific ASIN. Tracking how well a particular ASIN is performing in sales, keyword ranking, reviews, price, etc. is dangerous. There are so many potential external factors and reasons as to why sales are where they currently are.

Perhaps an ASIN with very few reviews but really high sales is only performing that well because the seller is a wizard at driving external traffic. Can you match that performance? There are plenty of reasons that sales may fluctuate per ASIN: running out of stock or driving external traffic. There are also plenty of reasons that price may fluctuate: split testing, temporarily attempting to push traffic. There are reasons that almost every metric you can track for a given ASIN may be fluctuating. But when you look at snapshot data, you don’t see the fluctuation, and you definitely don’t see what’s going on behind the scenes for that product. 

Research should not be a question of “how well is this specific ASIN performing?” but a question of “what is the sales potential in this market?” Ask yourself what the barrier to entry is for the market, and what the opportunity to outsell the competition is. Both of these questions require you to look at all of the top competitors and analyze the whole market.

Validation 

We work with the entire spectrum of sellers on Amazon. From large brand names to sellers trying to find their first item. For those in Facebook groups, I’m sure you’ve seen it a million times where someone posts a screenshot of the results from a sourcing tool where they ask “should I source this?” or “is this a good idea?” For every one of those posts, there are hundreds of sellers who don’t ask for help and end up getting into a product market where they waste precious resources: time and money.

At Viral Launch, we truly do believe that every product is a good product to sell so long as the numbers make sense for you. But there are some basic principles that make certain products absolutely great investments and others potentially risky. Think of it this way: if you’ve never been ice skating before, you’re probably not going to try competing against Olympic athletes the first time you lace up your skates. If you’re a new seller you don’t want to take on a highly competitive market like Vitamin C Serum. And even as an established seller, you might not want to take on a big brand like Tide in a market like Laundry Detergent. With the right knowledge, anyone can sell on Amazon. But that doesn’t mean anyone should sell in any market. And we believe your market research software should help you determine which markets are most favorable for you.

Product Suggestions

Imagine if you could snap your fingers and instantly know exactly which products you should source. That would be like every seller’s dream come true. And that’s why lists of hot products get so much attention. But a good product idea instantly becomes a bad product when it is easily accessible to many sellers. We have seen it plenty of times. Someone posts their list of hot new products, and within a couple of months, we have 20+ sellers come to us with those hot products. These product markets very quickly become saturated and the barrier to entry increases dramatically. Price wars cut margins in half, and suddenly that market that looked so good is terrible.

Unfortunately, for some sellers who have already placed inventory orders, by the time their product gets to FBA, the market has already turned sour. The way to avoid this nightmare scenario is to avoid products featured on these lists! We’ve seen it happen as a result of a product being mentioned by a guru or from popular webinars or demonstrations. The same can and does happen with programmatic product suggestions. That’s why Product Discovery offers warnings for popular results. Our goal is to help inspire new product ideas and then help you determine how great that idea is. Of course it would be incredible to have someone provide unlimited “secret” high potential product market suggestions. Unfortunately, it’s dangerous for the sellers who jump in.

Not Mobile Friendly

Our phones are a huge part of our lives these days. And we expect to be able to answer the questions that we have when we’re out to lunch or waiting for the subway. Market research software needs to be available in the same way that Google is available. It’s like your second brain. It’s right there when you need it. Because a product idea is going to hit you smack dab in the middle of your evening stroll around the neighborhood. Your best product ideas don’t always come when you’re sitting at your desktop. They probably come randomly, whether you’re out shopping, on your morning walk, in the bathroom, etc., having the opportunity to do a quick lookup on the go can be very helpful.

Stale Data 

Most software in this space does not update their information or algorithms regularly allowing estimates to become stagnate and remain that way for longer than 6 months. A BSR of #1 in Beauty back in 2015 is a lot different than a BSR of #1 in Beauty in 2017. As Amazon continues to increase in popularity and more consumers shop on Amazon, the amount of sales any particular BSR represents, continues to increase.

Market Intelligence: Our Version of an Amazon Market Research Tool

Not Snapshot Data, Comprehensive Data

Amazon’s Best Sellers Rank can be extremely volatile hour to hour, day to day, and week to week. So in our mission to develop the world’s most accurate sales estimation tool, we had to build a tool that was going to take into account the vast fluctuations in BSR that occur all month, and we’ve done just that.

Our Amazon Market Intelligence tool tracks and analyzes seasonal trends and displays aggregated sales across the market for up to two years. This allows any seller to identify how seasonal consumer behavior may be affecting current sales numbers as well as how future seasonal trends may have an impact on future sales.

 

Not ASIN Focused, Market Focused 

From our “outlier detection”, to our page of collective Market Trends (from sales to price to review quantity), to our Product Idea Score, we do our best to push users to focus on the principles of the market as a whole versus anticipating to replicate the results of a single ASIN.

Validation 

Our Market Intelligence’s “VL Analysis” page is dedicated to helping sellers validate or invalidate their product idea providing them with a 1 – 5 star rating based on a customer algorithm analyzing an impressive number of market indicators. We go a step further and provide sellers with key tips, warnings, and alerts of the market if they do decide to enter in. This allows sellers a comprehensive view of a market’s potential outcome for success.

Not Product Suggestions, Product Idea Inspiration 

While we are strongly against providing Amazon product/market ideas, we are very keen on providing inspiration or tactics of coming up with your own ideas! This is why we started our Sourcing Saturdays to help you develop your own ideas to then research with our Market Intelligence software.

Not Stale Data, Fresh Data Every Day

Our Market Intelligence tool continually updates our BSR to sales mapping algorithm each night. This allows our calculation to remain severely accurate and consistent with the natural trends of the market. Due to seasonal trends across Amazon, as well as Amazon increasing in popularity, estimation tools that do not refresh their algorithm regularly will find their estimations quickly become stale and continue to decrease in accuracy as time goes on.

The Most Sophisticated Amazon Product Research Tool

There are three major components to our Amazon product research and validation software.

Market Research – Top Sellers

The market research component of our sourcing tool provides a view very similar to what most are used to. Essentially we grab the top ranking products for a provided search term.

We provide data specific to each product such as brand, price, product title, estimated units sold over the last month (see why our sales estimation algorithm is more accurate than any other tool), review quantity, the sales to review ratio [[include link to another post]], net profit per unit, and estimated monthly net profit. If you click into any of the highlighted metrics you will be provided with historical data from the last 3-4 months. This is important for developing a better understanding of how products have been performing and what to expect if you happen to jump into the market.

Under the “Filtered View” tab, you will see essentially the same information with some rows of the table possibly highlighted in light pink. Highlighted rows depict market outliers. An outlier is a product we’ve determined to be statistically insignificant due to either their sales or reviews being far outside the market norm. The general rule of thumb is simply to ignore those listings.

The “Competitive View” allows you to see important metrics also shown in the “Standard View” as well as the opportunity to see the product’s full image set and title. The intention here is to allow you to quickly identify the types of products potential competitors are selling for the given search term as well as identify possible areas where you could provide better creatives to out compete.

Clicking into an image allows you to quickly flip through each product’s image set.

Market Trends

Making a sourcing decision based solely on the metrics of NOW can be incredibly dangerous. Our trends tool allows you to quickly identify how sales across the market have been trending over the last two years (provided data is available) as well as how the average price point and review quantity have trended. Has price been dropping significantly over the last 90 days? It may not be a great market to get into as margins look to be declining. Is the average review quantity growing at a relatively slow rate? May be an opportunity to come into the market with a better review funnel to outpace competitors and dominate the market.

For convenience we display how price has trended over the last 90 days in a simple percentage metric. We display the product’s best selling period throughout the calendar year. This can be a single month or a few months depending on consumer buying behavior. Finally we display, the rate of increase in reviews per month (ex. +10 reviews/month).

Viral Launch Analysis

The Viral Launch Analysis tab is our attempt at algorithmically helping sellers steer clear of money wasting products and into potential gold mines.

To kick off, we show our “Product Idea Score”, which is programmatically generated based on a large variety of factors and metrics both real time and historical. We’ve put all of our knowledge and experience running over 16,000 product launches, working with thousands of brands large and small, into this rating algorithm. A five-star product means that you’ve found a potential gold mine so long as you are comfortable with the provided numbers. A five-star rating means that the sales potential compared to relative barrier to entry is ideal, in addition to satisfying other market indicators we’ve identified contribute to successful products.

          At the bottom of the page you will find our “Tips, Warnings, and Alerts” section. Here we try to bring to your attention some of the opportunities, topics to be aware of, and potential success crippling aspects of the given product market. An example of a tip would be to consider bundling the product as it appears others in the market are doing it with a degree of success. An example of a warning would that the average price point seems to be declining in the market so be cognizant of the potential cannibalizing of profit margin. An example of an alert would be a scenario in which page one is dominated by known name brands that are consuming the majority of the market share.

Other Features

ADVANCED SEARCH 

We’ve included two opportunities to customize the results based on your specific situation. Do you have a minimum monthly units sold threshold? Plug in your sales minimum and we will take this into account when calculating your Product Idea Score. Have an idea as to what the landed cost may be per unit for the product you’re looking to source? Plug that into the advanced parameters and we will take that into account when calculating the net Amazon profit for each product shown.

The Search For Smarter Sourcing Decisions

We didn’t build our Amazon product research tool because we thought we could make money if we provided a marginal improvement on a tool similar to what others before us had created. We HAD to create this tool to help sellers avoid the potentially tens of thousands spent getting into product markets they have no business being in. We are now starting to manage more and more accounts as a company and we needed accurate market data. It’s impossible to make accurate future projections without knowing where the market has been. The old adage, “you have to know where you’ve been in order to know where you’re going” is incredibly relevant to jumping into a product market.

Start making better sourcing decisions when you sign up for the most sophisticated Amazon market research tool in the galaxy!

START RESEARCHING

We would love your feedback on how we can improve. What additional information, either historical or real-time, would help you make better sourcing decisions? What calculations or computations would help you to be more informed? We would love to hear your thoughts so we can all benefit!

They’ll Hand You Debt-Free Cash To Fund Your Next Amazon Product Inventory

Don’t pay it back until your Amazon inventory begins selling

Maybe this happened to you…

Or you know someone affected by this.

But if you keep reading you’ll learn how you can stop an epidemic Amazon sellers face.

It all starts when a product flies off the Amazon warehouse shelves and into the grubby hands of buyers.

Excited by all the cash flow, the seller realizes they must have Amazon inventory.

No problem… right?

They can funnel the new money into their Amazon inventory.

Sure… they could do that, but this seller wants to expand their business and offer more products instead of buying more Amazon inventory.

There’s not enough money to pay for inventory and then source a new product.

So they forgo the new product and focus on what’s making them money. Their cash goes into inventory.

They maintain what’s working, instead of sourcing to grow… their hope is to source that product in the future.

But a competitor discovers the same product potential. They source and sell on Amazon to gain the competitive advantage.

The seller who so desperately desired to source that same product yells out, Oh [insert your choice expletive here]!!!

A fortune lost because the cash wasn’t there.

But what if I told you this didn’t have to be?

Here’s how you fund your Amazon inventory

Instead of cash flow problems, investors are eager to hand you thousands of dollars so you can source and sell that product.

Sounds expensive… doesn’t it?

Like you’ll have to go into debt and pay back thousands of dollars so these investors can maintain their rich and lavish lifestyle.

Or that you’ll have to pitch your product idea to a group of investors like on the Shark Tank.

But it’s nothing like that.

This is a crowdfunded platform just for you, the Amazon seller.

Investors could be your next-door neighbor, your relatives, friends, or someone with billions.

You don’t pay back investors until your product starts selling on Amazon.

And investors love this platform as they can generate a 10% return on their investment in six months.

That’s faster than the stock market, which, as Warren Buffett points out, will only rise between 6–7% a year.

You can fund your inventory in as little as a day or two… just please be prepared to buy that inventory when the money rolls in.

Your information is private. Investors only see your:

  • First name
  • Product category
  • Total 12 months of Amazon sales
  • Return to investors
  • Amount to raise
  • Past total feedback and reviews

Recently closed campaign

It doesn’t matter what type of Amazon seller you are (Private Label, Wholesale, Arbitrage) you can get funded.

This all sounds too good to be true now, doesn’t it?

But it’s not… it’s a real platform to assist you in raising the capital necessary for your next successful Amazon product.

If you’re tired of watching all the other sellers making money hand over fist on Amazon, then it’s time to grab your inventory to start making fat cash.

What do you have to lose?

Head over to UpFund for your quick and painless decision you’ll receive in minutes.

Related: Research your next Amazon product idea with the Viral Launch Sourcing Tool

Amazon Success Guide Step 1: Sourcing A Great Product At A Great Price

Let me first begin by saying just about every product available to sell on Amazon as a private label product is a GREAT product to source, so long as it fits into your business’s strategy, you have the resources, and it makes sense for you as an entrepreneur. So the difficult thing is not finding a product to source. Go to Amazon.com’s home page, and you’ll see plenty of sourceable widgets. The difficulty lies in finding a product to source that fits You and Your business.

In this article, it’s our goal to help you identify what makes a product great for you, so you can build the foundation for the level of success you are looking for!

 

Identifying What Private Label Success Looks Like To You

While we are largely going to try to help you identify how to choose products that fit your ideal success model, we are also going to be challenging your definition of success. We’ve seen many many sellers succeed, and unfortunately our fair share of sellers fail despite our efforts. With the experience and data we have, we’d like to help you avoid the pitfalls we’ve seen others make.

So what does success look like to you in the private label world? Are you looking to hit a couple of home runs with some high volume products that profit you $10,000+ per month each? Are you looking to source a variety of low volume products that when added up bring in a hefty profit each month?

This is a decision you will have to make for yourself. If you expect to profit $5,000/month on a single product, but get into a product market where the average sales price is $10 and the average sales volume among the top sellers is around 500 units per month, you will be severely disappointed. If you are looking to source 5 products that add up to a monthly profit of $5,000/month, then this very well may be a good choice. See how expectations and how you define success matters?

Obviously we would all like 100 products that profit us $20,000 per month, but so does everyone else, which means you are going to be competing with a ton of other sellers. So in order to appropriately define your definition of success, you also need to understand how plausible your ambitions are given your current resources both financially and time-wise. Do you have a big team? Do you have thousands, tens of thousands, hundreds of thousands, a million+ to invest in your Amazon business?

Questions To Ask Yourself In Determining What A Successful Product Should Look Like

How Much Money Do I Want To Invest?

Do you have thousands, tens of thousands, hundreds of thousands, a million+ to invest in your Amazon business? The amount of money you have to invest will determine how much inventory you can afford. This may influence the products you select based on their per unit cost. This also has an impact on how large of team you can build initially (if necessary). The quantity of inventory you are able to purchase also has an effect on the amount of promotional units you will be able to give, having major implications on your ranking strategy. 

How Large Is My Team? How Large Of A Team Do I Want To Build If Necessary?

Some sellers prefer to not grow any larger than themselves and a couple of VAs they hire hourly. Other sellers are willing and ready to build a massive infrastructure of warehouses and employees. Obviously this is not a question if you are just getting into the business, but for some later stage sellers this may be a barrier to growth if growing a large team is outside of your comfort zone.

What Kind Of Profit Margin Am I Looking For Per Product And Collectively?

Are you wanting to go deep on a few high volume products? Are you looking to go wide meaning going after a larger variety of low to mid volume products? There are pros and cons to each, and we’ll outline those down below!

In total are you just wanting to add a few thousand dollars to your bank account each month or are you looking to build a mammoth $1,000,000/month Amazon business?

How Many Products Am I Looking To Sell In the Next 3-6 Months?

For sellers just getting started, again, this is not a question you can answer accurately right now. It is also highly dependent on your capital. Some sellers are okay launching just a couple of products and reaping the benefits each month. They don’t want the added stress and pressure of continuously launching product after product. Keep in mind the amount of profit you are looking to make total. Going after a couple of products that may add $1,000 of net profit will not get you to your total goal of $5,000 if you are only wanting to sell two products in the next 3-6 months.

What Is My End Goal With This Business?

Is this going to be a lifestyle business for you or are you looking to maximize sales to shoot for an acquisition?

This may or may not have an effect on how you choose your products. For example, from our experience with Amazon business acquisitions in the private label world, companies are looking for strong brands. So selecting products that will allow you to build a cohesive brand will be important. With that said, Amazon businesses that are purchased solely for cashflow purposes do not typically put emphasis on having a unified brand(s). Either way, it is an important consideration in how you will position yourself for acquisition if that is your goal.

How Things Will Change With the New Amazon TOS Update

Post TOS update, from our perspective, sellers must be more precise in selecting a “good” product because the playing field has been leveled. Pre-update, it was very easy to give away a large amount of product in exchange for reviews. Doing so generated a competitive number of reviews and built a sales history that got that product ranking for each and every keyword that the seller selected.

So if you had a super competitive product, you were okay so long as you had the money to run enough promotional sales.

Post-TOS update, generating a competitive number of reviews becomes much more difficult. Generating reviews today rests solely on having a killer product that customers want to review and leveraging a killer email follow-up sequence to ask your customers to actually leave a review.

So how will this affect your decision making in selecting products to source?

You need to be drastically more concerned with the number of reviews page one and two competitors have. While there is some misinformation in the space around a “magic number of reviews” needed to generate organic sales, our data shows us that the key to selling well organically is having a “competitive” number of reviews relative to those listings you find yourself around.

What that means is, if the page one sellers have reviews that look like this RUN FAR AWAY!

 

 

 

Here is a screenshot from the same keyword, “vitamin c serum” that shows how important having a competitive number of reviews is. The listing ranked 6th has 10,000 reviews and is selling 3,000+ units per month. The next guy, although ranking really well for a very high level keyword, is only seeing 270 sales per month. At the 8th position they have a decent number of reviews, especially compared to the the 7th and 9th position, so they are seeing a moderate volume of sales. At position 9 the seller is hardly seeing any sales at all because they have 0 reviews! While there are multiple factors that come into play when a customer decides which product to ultimately buy, reviews and price typically have the most substantial effect.

 

Are Home Runs Dead?

The short answer is no. Not at all. If you have already been working on a home run type product (home run = high volume product), then definitely don’t give up. Depending on where you are at in the product launch cycle, you may need to adjust your strategy, but don’t worry, success is still a very attainable goal.

If you are just getting started with a home run and it is your first product on Amazon, beware. It is likely to be a long and costly battle depending on what the market looks like. It can be best to get started with a relatively simple product to understand the market, the processes, and the expected results.

Our suggestion for new sellers is to get into markets where a “competitive” number of reviews is below 500. Ideally you could find a product where page one sellers ranking between #3 – #12 have a sales volume of 500-1000 units/month and have around ~250-500 reviews. These products are much easier to break into the market with and allow you to learn a lot of the ins and outs of selling on Amazon without investing too much money.

 

Keys To Sourcing Great Products Regardless of The Amazon TOS Update

  • Find a quality product!
    • Reviews are king on Amazon! If you have a poor quality product you are going to find yourself with a product that continues to generate poor reviews. Before too long you end with a product noone wants to buy. There is nothing worse than having thousands of dollars in unsellable inventory.
    • Quality products can result in the sales boosting effects of word of mouth, positive reviews, and repeat customers (depending on the product of course).
  • Find a product at a great price!
    • If you are sourcing your product at a 25% higher cost than your competitor(s) for the same exact product, they will always be able to beat you on price. You can quickly lose to the competition on listing price, promotion capabilities, etc.
    • Product sourcing Guru Alan Basinger has a quote that I love! He says, “You have to win on the buy!” It is spot on. Alan has a logistics company that helps bring products into the US as well as sourcing directly from manufacturers in China.
    • Go to China directly! The Viral Launch CEO recently went to Yiwu with a group called SourceInAsia as a mentor and saw just how powerful working with manufacturers directly can be to negotiating quality product at a great price.
  • Find a product with great margin!
    • Margin is a huge consideration for product price. Make sure there is a great margin between the price at which you source and the price at which you sell is key! If you’re not making much money per item what is the point in selling? The other fear is if the market decides to start competing on price you want to make sure you are not priced out. We’ve seen this happen all too frequently over the last couple of months.
  • Watch Out For Name Brands
    • We’ve seen a couple of sellers get into products that are largely dominated by name brands. This is common in baby/children’s products. For example, sourcing crayons as a private label product can be insanely difficult because the first couple of pages are almost completely dominated by Crayola. Good luck competing with them.
    • Also be weary of sourcing a product where the main keyword(s) is also a brand’s name. Ex. “Yeti Mug”. It can be very difficult to outrank a brand if the main keyword is the search term. Amazon attributes a LOT of rank power to the brand’s name.
  • Consider product size, weight and durability!
    • Knowing how the size and weight of a product will affect shipping is crucial to estimating margin and expense. Work with your sourcing agent or manufacturer to understand the costs associated with shipping your product into the country, to your warehouse, and/or FBA.
    • You will also need to know what Amazon’s FBA fees associated with shipping will be. For that you can use Amazon’s FBA Revenue Calculator which will give you a good idea (don’t bank on the accuracy of the fees).
    • Durability is key to providing a good customer experience and avoiding customer returns. You may want to avoid easily damaged items.
  • Long-Term Brand Building Or Revenue Generation
    • Are you looking to build a long lasting brand or just looking to solely focus on increasing revenue (not that building a brand won’t help you generate revenue)? If you are looking to build a brand, make sure to choose products that will allow you to easily add products that make sense such as a yoga mat, and some yoga massage balls. The added benefit here is you can take advantage of bundling and upselling. It also saves you time and money by allowing you to pay to have one brand created (logos, label/package archetypes, etc.).
    • If you are looking to simply grow revenue you can be very selective in the products you decide to source. Meaning, if the numbers make sense, source it. Sellers who take this approach end up selling products as different as a eye cream and a pet bed.
    • Either approach is great so long as it aligns with your idea of success in running a private label business.
  • Make Sure Your Product Is Created With Customer Approved Materials
    • You don’t want to source a cream that is going to cause rashes.
    • If you say your product is organic/natural/paraben-free/etc. make sure that it is. If all of your competitors are able to make such claims, you will miss out if you cannot, but don’t lie to your customers. Trust me, they will find out if you are!

Tools To Use When Product Sourcing

Jungle Scout

The Viral Launch team uses the Jungle Scout Chrome plugin religiously when putting together launch strategies. This tool is great at allowing you to quickly analyze the most important stats of products that rank for a given search term without clicking into each listing (at least that’s how we use it). Jungle Scout also has the most accurate sales estimates overall I’ve seen.

When sourcing, Jungle Scout also allows you to easily compare how a style of product is selling better than others. For example, let’s say you are wanting to sell grill/cooking gloves (which I would advise against due to the amount of competition). You would want to know if you should invest in the type of gloves that have 5 fingers or the mittens that have one slot for your thumb and one for the rest of your fingers. Choosing incorrectly could have major implications.

We also use Jungle Scout to estimate the number of units we will need to give in promotions to achieve keyword ranking and to help give for reviews. With the TOS change these numbers will differ (which we will get into in a different section of this guide), but having an idea as to the number of units you will want to use for promotion are crucial to understanding the total costs associated with launching a product.

Greg at Jungle Scout has plenty of tutorials on how to effectively use the tool. We personally use the tool for a very limited scope of its total potential!

Project Sourcing Success (Name To Be Announced Later)

Viral Launch has seen too many sellers lose thousands of dollars by making bad sourcing decisions. By the end of October of this year we are planning on launching a new tool that will help you make more intelligent decisions around product sourcing. It will go wonderfully along with Jungle Scout or similar type tools.

If we can help our clients avoid bad sourcing decisions, we will gladly seize that opportunity!

 

Conclusion

It would take us many blog posts to effectively cover the entire ins and outs of product sourcing, and to be honest, we are not the best company to handle how to source end to end.

With that said, our extensive knowledge, data and experience in running over 11,000 product launches and working mega sellers doing 50-100 million a year in sales on Amazon, we do have plenty of beneficial tips and knowledge that can help you avoid some major pitfalls that can have serious repercussions.
At the end of the day, you need to make sure you are selecting products that appropriately align with your idea of success and your resources. What is a good product for the next guy may not be a good product for you.

 

If you have any questions, we will be happy to answer them in the comments! If you have any feedback, we would love to hear it as well!

Ultimate Amazon Private Label Guide to Success – Post Amazon TOS Update 2016

The Amazon space has changed and while we are still waiting for the dust to settle, there are some basic truths we do know like the fact that we CANNOT give products away at a discount. No more 80%+ review rates from discounted product sales. It’s going to change the fundamentals of how sellers can quickly get products up and selling. So the Viral Launch team is putting together a comprehensive Amazon private label guide to successfully launching products on Amazon with the new rules brought about by Amazon’s latest Terms of Service update. It’s epic and incredibly beneficial to all levels of experience on Amazon.

Spoiler Alert! Selling on Amazon Is NOT Over! It’s Not “Too Hard” Now. If That’s Your Mindset, Change It! Life As An Entrepreneur Has Its Challenges. It’s The Strong That Survive, And Together, We’ll Help You Thrive!

Each day we will feature a new step in the process of selling private label products on Amazon with specifics on how each step has been affected by the TOS change. We are super excited to help you navigate the process based on our extensive knowledge and experience in the space of running over 11,000 product launches and working with high level sellers selling between $50-$100 million per year on Amazon.

You can find our Ultimate Amazon Private Label Guide to Success landing page here. Each day we will add a new section and topic! Our first day we discuss product sourcing and how to make intelligent decisions when souring especially with the new market conditions following the TOS update. The page can be found here!

Are you excited about our guide? What topics would you like us to cover?

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