A Look Back at Our 2019 Amazon Predictions: What We Got Right and What Went Wrong

With 2020 well underway. I thought it would be fun and insightful to look back at our 2019 Amazon predictions in anticipation of our annual predictions post coming later this week. 2019 proved to be a rollercoaster of a year, offering up some scary changes and unexpected loops. Let’s go through our predictions together and see what we can learn from the year.

1. Major Brands Get Smart About Amazon Organic Ranking & Sales

In what can only be described as a continuation of previous years’ policies, major brands made surprisingly little progress on this front in 2019. A majority of top brands continue to express trepidation with Amazon’s inability/refusal to properly regulate or restrict unauthorized sellers. In addition to lax regulation, major brands (particularly apparel brands) continue to struggle with counterfeit or knockoff products that persistently flood the Amazon marketplace. 

Despite Amazon taking additional steps to regulate these unauthorized activities, the delicate balance between increased revenues vs increased costs, coupled with the burden of brand exposure at the risk of brand dilution, creates a perceived Faustian wager which often prevents the worlds best-known brands from fully embracing Amazon…for the time being.  

A telling example of major brand woes is Nike’s decision to withdraw in November of 2019 after a 2-year pilot program. Nike’s decision comes despite the apparel juggernaut being one of the few brands shoppers explicitly search for…“Nike shoes for men”. Even with this incredible keyword advantage, Nike and Amazon failed to create the synergy needed to justify the shoe giant’s wholehearted commitment to the Amazon space. For example, when searching for the keyword phrase “men’s shoes” on Nike.com results yields 741 options compared to 28 with the same “keyword phrase” on Amazon.com. This disparity in selection is primarily attributable to Nike’s resistance to committing their full product line. Nike feared Amazon undermined the brand by eliminating elements of product exclusivity and unique customer experience. These worries,  coupled with the frustrations of unauthorized 3rd party sellers, forced one of the world’s largest brands to make the difficult decision to withdraw from the space for the time being.

As Amazon continues to make improvements in both UI, branding, customer care, and the catastrophe of counterfeiting, it is likely that brands like Nike will eventually be forced to negotiate a detente in the months and years to come. This being said, the democratization of delivery and logistics, paired with the diversification and globalization of the e-commerce shopping habits displayed in younger generations, will force Amazon to justify the rising costs of advertising while continuing to improve their customer experience if they expect to further seduce the world’s largest and most sought after brands to their platform. 

2. Amazon PPC Becomes Less Profitable But More Important

If Amazon trends for 2019 could be summed up in one sentence it would be: The year that advertising activated.” This sleeping giant of dormant revenue has long been seen as a vast, untapped, oil field of pure profits for Amazon. After many years of prospecting, Bezos and Co. began to drill in 2019, creating both fear and uncertainty for newcomers and veteran sellers alike. 

In reaction to this seismic shift, 2019 saw brands and retailers spend close to 10 billion dollars on Amazon advertising in the US alone (the equivalent of 14% of Amazon’s 2019 3rd quarter retail sales), an increase of more than 33% compared to 2018. As PPC costs began to rise in the early part of the year, many sellers found themselves in the midst of fierce bidding wars for the most competitive keywords within their products’ unique categories. The accompanying decrease in ROI for cost per click ads sent ripples through the community, forcing sellers to rethink advertising budgets and more closely evaluate risk in competitive or oversaturated markets. 

In anticipation of this market disruption, Amazon opened up new analytics and built out a full learning console to educate sellers on the parameters and realities of this new paradigm. With advertising revenue estimated to grow in excess of 17 billion dollars by 2021an estimated 9.7% of the Admarket), Amazon is  poised to join Facebook and Google in what will be a triumvirate of ad giants for years to come. 

As early as 2018 Viral Launch anticipated this change and was proud to launch Kinetic in an attempt to guide our customers through the shifting sands of this new PPC landscape. Kinetic offers our customers detailed PPC analytics, as well as managed PPC services, to help ensure the maximum competitive advantage in this ad-driven reality. As 2020 gets underway, we are excited to iterate, improve, and update this software in the coming months to offer our customers more features and powerful, data-driven results.

In years past Amazon has often been compared to the wild west of online retail. With the reality of these new advertising demands and cut-throat economic constraints, it’s clear that a new sheriff has come to what was once a lawless internet boomtown. This being said, if history has taught us anything it’s that every time a once rough and tumble boomtown grows into a more ordered and lawful city, that growth only brings with it more opportunity for those who can anticipate the changes and adjust accordingly. 

3. The Reign of Building Brands Off Amazon

2019 saw US e-commerce grow an estimated 17.3% in the 3rd quarter alone. This growth constitutes the largest spike since the 4th quarter of 2011. Online retailers generated $145.7 billion in online sales in the third quarter compared to $124.2 billion a year ago, according to the Department of Commerce. To no one’s surprise, Amazon was at the vanguard of this growth  with 29.4 billion dollars in retail revenue. Retail giants such as Walmart and Target also saw significant growth, surpassing analyst’s initial projections for the year. 

This being said, the building of brands outside of the Amazon space was hampered by a combination of both lack of innovation and Amazon’s sheer market domination. E-commerce storefronts such as Shopify have become popular sales channels for emerging brands but have struggled to make significant brand breakthroughs for sellers looking to differentiate themselves from the Amazon pack.

Adding to the stagnant growth of non-amazon brands is the entrenchment of consumer behavior as it applies to a growing (Amazon only) default mode, particularly when it comes to buying behavior in Q4. Smaller sites have continued to struggle with ways to break consumer’s growing dependency on Amazon to fulfill both their personal shopping needs as well as their family and friends wishlists. This dependency is only fueled by the increasingly common practice of giving  Amazon gift cards for Holidays, birthdays, and special events. 

Despite the many uphill challenges facing smaller e-commerce sites, Viral Launch maintains a bullish outlook for emerging brands’ opportunities to develop a customer base apart from Amazon in the coming years. Case studies like that of Nike (mentioned previously) demonstrate that larger brands are keeping Amazon accountable to change, while smaller more boutique brands will continue to benefit from improvements in online marketing platforms, improved mobile apps, and a leveler logistical and shipping ecosystem.

4. Successful Brands Will Continue to Grow Significantly

People often say that “success breeds success.” I’ve also heard it said: “More money, more problems.” The dichotomy of these two truisms neatly encapsulates the difficulty facing many successful Amazon sellers. With greater success comes the desire to capitalize on increased revenues. At the same time, potential market capitalization and expansion comes at the risk of overreach or glut. 

For the most part, “successful” brands did see significant growth or at least marked stability in 2019. The market disruptions caused by additional PPC costs and ranking fluctuations surely caused concerns for many top sellers, However, the data seems to indicate positive growth. Over the past decade third-party sellers have grown from 30% of total sales on Amazon to 60% in 2019. The number of sellers with $100,000 in sales reached 280,000 in 2019, up from 200,00 in 2018. This influx in competition does indicate a struggle to sustain market supremacy for some top-level sellers, however, we maintain the belief that better and deeper performance is outpacing wider participation. 

The latest figures show that only 5% of the top sellers joined in 2019, while only 30% of top sellers have joined within the last 3 years. The reality remains that less than 20% of active sellers do $100,000 in yearly sales and only 2% surpassed 1 million dollars. This by no means indicates that the window of opportunity for Amazon selling has closed. However, it’s becoming increasingly clear that the competitive advantage of deep experience will only increase in the years to come. 

5. Fewer New Entrepreneurs Begin Selling On Amazon

Amazon reached 3 million active sellers worldwide in 2019, an increase of 17.7% from last year. The global marketplace saw 1.2 million new third-party sellers join one of 16 global marketplaces after both Singapore and the United Arab Emirates were added to the platform. These numbers indicate a steady and robust global growth trend for Amazon, who has become increasingly aggressive in exploring untapped markets. However, a closer look at the domestic numbers does indicate a potential cooling in the number of new entrepreneurs who are entering the US market. 

2019 saw 250,000 sellers join the US space, which adjusted for churn comes closer to 54,000 additions to the overall seller pool. The United States is currently the slowest growing market on Amazon despite its outsized 38% active seller share. Last year’s additions constituted only 5.1% of the global growth for Amazon as a whole. Now these numbers in no way indicate that the fervor amongst potential new sellers has died out However, there are some indications that a large majority of entrepreneurial-minded men and women who may be drawn to Amazon have either already started to sell, or more likely churned out of the system. 

The likelihood that the US market will see a resurgence in new sellers is contingent upon a number of unknown and unpredictable factors, chiefly, sustained low unemployment numbers and the continued stability of the US and global economy. A sustained period of economic growth has doubtlessly encouraged new entrepreneurs to take their chances selling on Amazon. However, if the economy begins to show signs of weakness in the months or years to come, we may see an even greater decrease in the number of new sellers who throw their hat into the ring. 

The good news for current sellers is the possibility of less competition and again: the deepening of performance. If, as some metrics indicate, the pool of sellers becomes even more narrow in the years to come, it will present an opportunity for current sellers to bolster their positions and rankings while growing their brands.  

6. Major Changes in Reviews and Rankings

Shakespeare once asked…”What’s in a name? That which we call a rose By any other name would smell so sweet.” 

This age-old question of what’s in a name could never have been more true then when Amazon elected to change its classic naming convention in 2019 from reviews to ratings. Of course, this simple, semantical twist held a far more important and disruptive change. The ability to leave ratings without a written review (one-click rating), coupled with a variety of changes to the ranking algorithm, threw the system into what at times felt like chaos this year. Reliable methods for bolstering rankings, such as product giveaways and coupons, became less and less effective and the reality of a world of PPC predominance became abundantly and at times painfully clear.  

Wild fluctuations in rankings were experienced by both newcomers and established sellers alike as Amazon seemed to endlessly tinker with their ranking systems and established protocols.  (INSERT BLOG POST AND PODCAST ADDRESSING THIS PHENOMENA) 

Veteran sellers have (for the most part) grown accustomed to Amazon making major changes to rankings over the years, and in due time resourceful sellers and consultants have always learned to adjust. This being said, 2019 will surely be looked back upon as a watershed moment for ranking changes, as the culmination of years of subtle tectonic shifts suddenly crest, taking sellers on a wave that left many dizzy and some drowned. 

7. Facebook Begins Its Path of Becoming The Second Largest Ecommerce Site

I imagine that Mark Zuckerburg and the executives at Facebook won’t look back at 2019 with the fondest of feel-good memories. Thrust into a firestorm of controversy regarding the companies privacy policies beginning in 2018, Facebook continued to court controversy throughout 2019. However, as anyone who tracks markets knows, there is a wide chasm between public perception and publicly traded profits.

Despite widespread fears of anti-trust legislation in the early part of the year, 2019 saw Facebook make huge gains, surging back to a near-record stock price just weeks ago. The ability of Facebook to absorb such huge public scrutiny while continuing to display investor confidence is precisely why Viral Launch remains so bullish on the social media giant. While the media continues to argue (about what I would personally characterize as legitimate concerns), Facebook is quietly making gains in the e-commerce landscape and beyond. 

In 2019 Facebook acquired a number of small media and technology companies to help expand its Marketplace platform. Plans have been put in place to develop live shopping features as well as expansive updates to Checkout, their new Instagram shopping platform. The unsurpassed mixture of loyal and engaged subscribers, coupled with a multi-quadrant demographic, makes Instagram the holy grail of endorphin-fueled impulse shopping. The secret, of course, is leveraging these technologies to create a unique market position that can begin to cut into Amazon’s bottom line. I don’t know about you, but I’m not counting Zuckerburg out from being able to convert some of their huge market capitalization into technologies and tools that set Facebook apart from Amazon in 2020. Besides, I would not be surprised if Facebook wants to gain back some of those precious ad dollars they lost to Amazon last year! 

8. International Markets are the New Gold Rush

Continuing our theme of political and social uncertainty in business, this past year brought a slew of unknowns in many aspects of our global, economic, and political landscapes. Escalating uncertainties concerning Brexit, China, and the Middle East have kept businesses, investors, and entrepreneurs on the edge of their seats. A mutual disdain for Chinese tariffs showed that these obscure financial instruments might be the one thing in this world that can bring Wisconsin farmers and Wall Street financiers together in fear and disgust. 

The devastating effects of tariffs, coupled with risk-averse investors, created a landscape that caused this prediction to not fully manifest. No doubt international markets still present a huge growth opportunity in the coming years. This being said, for the time being, many sellers are waiting for the results of a slew of international trade talks to conclude and uncertainty within political landscapes to calm before wading into these potentially bountiful waters. 

On a further international note, 2019 saw the year that Amazon pulled the plug on its Chinese operations. Amazon entered China in 2004 and after much consternation and disagreement, the ill-fated partnership finally dissolved in July of last year. Below is an excerpt from an email sent to multiple publications. 

“We are notifying sellers we will no longer operate a marketplace on Amazon.cn, and we will no longer be providing seller services on Amazon.cn effective July 18th. Sellers interested in continuing to sell on Amazon outside of China are able to do so through Amazon Global Selling.”

Obviously, this announcement in no way severs relationships with China based sellers who constitute 42% of all active sellers across all 16 marketplaces.

9. Seller Fulfilled Prime Comes Into Vogue

Many top-level sellers entered 2019 with high hopes for Seller Fulfilled Prime. This program which enabled 3rd party warehouses to fulfill prime orders was seen as the natural evolution for high-level sellers who had invested heavily in warehouse facilities and third-party logistics providers for their businesses. The hope for this program was to generate significant savings for sellers by tailoring various logistical and shipping needs thereby reducing overhead and unneeded expenditures. 

Unfortunately, due to an array of quality control issues, coupled with a high barrier to entry, the program was suspended in 2019. At the time of publishing, Casey spoke with an SFP customer who informed him that Amazon plans to parlay this program into what is being called FBA Onsite. Details about this program are not yet known at this time, however, I think it’s safe to assume that it will contain many of the aspects of SFP with perhaps more regulations and stricter qualifications. Regardless of what name the new program settles upon, it’s safe to say that the concept of seller fulfilled shipping is not going anywhere. Far too much money is on the table for Amazon to resist mitigating a portion of the risk in favor of equitable partnerships with high-level sellers as the benefits of same-day or two-day shipping will not be strictly limited to Amazon products in the near future. 

10. More Amazon-Owned Brands

This particular prediction presents an interesting case study in the difference between the profitability and success of AmazonBasics and the growth of Amazon Owned brands. As stated in last year’s post, some countries such as India have banned Amazon from creating further Amazon-owned brands, citing monopolistic practices. This, of course, has not stopped Amazon from continuing to expand both their Basics brand and Amazon-owned brands through their Accelerator program. Amazon added more than 100 brands in 2019 and shows no signs of slowing down. This being said there are some misconceptions about the profitability of these brands and their long-term viability in the future. 

AmazonBasics constitutes 58% of all “Amazon-owned brands” and represents the bulk of Amazon brand revenue. In fact, 81% of all total sales come from just the top 10 Amazon brands, including Basics, Essentials, and Collections. Basics thrive in niche markets such as batteries or paper products, markets where fragmentation and price-point pressure fuel their success. On the contrary, many Amazon private label brands such as Belei hope to exist in the much more competitive worlds of beauty and skincare. After launching in March of 2019, Belei began to receive a swath of negative reviews, forcing Amazon to not only adjust their price points but give the prominence of the product within the search results. None of these actions had a great effect and the brand continues to languish in warehouses unsold and for the most part unknown. 

What is the lesson here? For all their data and all their power, Amazon has never been particularly good at fostering brands. Their basics lines do great business because consumers are not invested in battery brands or toilet paper the way they are invested in their skincare routine or health drinks. 2020 will surely see Amazon continuing to leverage its power to create countless new brands, and they have the cash flow to allow the majority of these loss leaders to fail. What I’ll  be looking for in 2020 are Amazon-owned brands that are invested in marketing brands that use their unbelievable prominence and page positions in a way that breaks through the noise and create devotees. If Amazon can display the ability to do this, well then anti-trust laws might actually be in the conversation. 

11. Less Ads Showing on Page 1 of Search Results

In my role as a brand consultant for Viral Launch, I log onto amazon.com anywhere between 30 and 50 times per day. Every time (and I mean every time) I do, my heart sinks a little at how truly ugly the sight actually is. I know that might sound a little hyperbolic but you have to understand the little graphic design nerd in me, the one that cannot stand mixed typefaces and cluttered images. For me, these visual sins are akin to fingers on a chalkboard. Of course, I say all this tongue in cheek and Casey knew he was being a bit bold when making this prediction last year. However, when forecasting the possibility that Amazon might reduce ads on page one, Casey was tapping into the hope that Amazon might embrace one of its core values…delighting customers! If you’re anything like me, you’re equally bummed about this prediction being so, so wrong. 

Perhaps we did not fully account for the lengths which Amazon would be willing to go to maximize those precious new ad dollars. Or perhaps we thought they would invest in creating new user interfaces to provide aesthetic experiences without the need for more Ads. Alas, we got this one wrong and the world is uglier for it. 

12. Amazon Significantly Outpaces Other Retailers in an Economic Downturn

To conclude our journey through 2019, we end on this final and gratefully wrong prediction for 2019. Despite a slew of economic forecasts in 2018, the economy held strong and outpaced many economists’ (and brand consultants’) predictions. This, of course, does not mean that the current climate will last forever. An economic downturn is inevitable in the coming years. For the purposes of our discussion here, how ready is Amazon for that downturn? 

I will leave you with this parting data point. In the first quarter of 2019, Amazon’s online sales accounted for less than 50% of the company’s total revenue. For the first time since the company’s founding in 1994, AWS, Prime, third party marketplace, and advertising, outpaced the retail sector of the company. Amazon sold 29.4 billion dollars worth of product, which only constituted 49.4% of its revenue. 

I don’t know about you, but to me, this seems like a strong case for Amazon’s future regardless of the economic forecast. Retailers such as Wal-Mart and Target have made valiant efforts and significant gains within the last year. We have seen competitors innovate and iterate in every conceivable contortion all in an attempt to catch the king. But I ask you this: if I took away 50% of any of these competitors’ revenue in 2020, do you think they would live to see 2021? 

I don’t think so. 

2020 predictions are coming soon!

How To Launch a New Product on Amazon

Launching a new product on the Amazon marketplace involves a lot more than you might realize at first. It’s not just a matter of listing the product. You also have to find and incorporate high-quality images and written content, organize early promotions and advertising strategies, generate early reviews, and ultimately make the product visible. It sounds like a lot — but the right guide can help get you launching new products on Amazon in no time.

These early steps are critical to the product’s long-term success and your own growth as an Amazon seller. Those who put enough time and effort into their product launches can gain traction and market share faster. As Amazon CEO Jeff Bezos recently revealed, third-party sellers now generate more revenue on the marketplace than Amazon itself.

This also means that the market is getting more crowded and that gaining exposure is increasingly difficult for every new Amazon product launch. From choosing the right product to planning out the right launch strategy, however, there are a few things you should know — and a few things you should avoid — to get a leg up when launching a new product on Amazon.

First of All, There’s No Point in Launching a Product If It’s Not the Right One

Before you ever get started launching a product on Amazon, you must choose the right product. Start by researching several product markets as thoroughly as possible so that you can set realistic expectations. For example, in some markets, first-page products can sell 10,000 units per month, but it’s often unrealistic to expect you’ll reach those numbers quickly.

You can raise sales volume faster in niche markets with thinner competition. However, these markets typically see lower sales volume, so make sure you have a thorough understanding of your expected sales before entering the market. You can forecast revenue and measure barrier to entry using Amazon product research tools.

With that in mind, you’ll also have logistics and manufacturing costs, as well as Amazon fees, marketing, advertising, research, content production, and other costs to consider. You need to thoroughly understand where your point of profitability lies so you have a goal to aim for. Then, you can plan a much more successful Amazon product launch strategy.

Once You Know What You Want to Sell, Find Out How to Successfully Launch an Amazon Product

If implemented correctly, a new Amazon product launch will drive sales early, and early sales are critical in helping you gain early traction in the market, improve your keyword ranking, and net some early reviews to give your product an advantage.

In addition, early sales can teach Amazon’s algorithm that your product is a quality option for shoppers, which helps promote easier ranking and sales growth in the future. Shape your Amazon product launch strategy using these six steps as a guide:

1. Take time to read the terms of service.

Before launching any product, carefully read and understand Amazon’s terms of service. You’ll want to do everything you can to give your product the best chance at success, but you do not want to risk your account by unwittingly violating the rules.

2. Be prepared not to make a profit at first.

Properly driving success on Amazon while sticking to the terms of service takes capital, so be prepared not to make a profit with early sales. Amazon’s market isn’t a get-rich-quick platform; running your online business is just like running any other business. That means stimulate long-term sales requires spending on marketing and advertising, offering discounts, and more.

3. Reorder inventory before you run out of stock.

As you watch your sales and profits, you may be tempted to wait until your initial inventory runs out before ordering more. If you do so, you’ll risk running out of stock before you can replenish it. Being out of stock means shoppers will bypass your product listing, and it can negatively impact the listing’s keyword ranking.

4. Take advantage of early review generation.

Keeping an adequate amount of stock is important, but buyers might still scroll past a product that hasn’t even been reviewed yet. In one e-commerce study, up to 79% of buyers say they check reviews before making any purchase on Amazon. You can sign up for Amazon’s early reviewer program, set up and send out email sequences to customers, and craft a social media announcement strategy that adheres to Amazon’s terms.

5. Take advantage of Amazon’s massive customer base.

Unlike using your own branded website, Amazon’s biggest benefit is that it brings customers to you. The challenge is getting your product in front of them, which means focusing on Amazon SEO. Generate as many sales as possible up front, which will kick-start your listing’s keyword ranking. After all, thousands of people are already searching for your type of product. Now, it’s your job to get in front of them. Amazon sponsored ads are a great way to put your new product in front of eager shoppers. Learn how to run ads with our free Amazon advertising course.

6. Keep researching after the product launches.

The more you know, the smarter decisions you’ll make when it comes to ordering, listing, advertising, and scaling. Use data to gain insights into missed keywords, sales trends in your market, and your advertising opportunities. The insight you gain will help you create an even more effective strategy the next time you have a new Amazon product launch.

The path to a successful Amazon product launch strategy is different for every seller, product, and market. But the most important tips for any successful Amazon product launch are to understand what kind of market you’re getting into, to ensure that your expectations align with what’s possible in that market, and to drive initial sales. To learn more about what it takes to launch your product successfully on Amazon, sign up for your free trial with Viral Launch today.

A Beginner’s Guide To Amazon’s FBA Process

If you plan on selling high-volume products on Amazon, you may want to choose the Fulfillment by Amazon shipping plan. Under the FBA process, you send your inventory to Amazon. Upon each order, Amazon stores, picks, packs, and ships your stock from its warehouse.

It can save you a significant amount of time and reduce the burdens of storing and shipping your product. However, that doesn’t automatically make FBA the right choice for every new Amazon seller, so we’ve outlined a few of the most important things you need to know before starting the FBA process.

Calculating Your Amazon FBA Costs

In many ways, FBA is the most convenient shipping option, though there are a few fees you should be aware of. For example, FBA’s fulfillment fee is a flat, per-unit fee based on the size and weight of each item (e.g., standard or oversized).

You’ll also be responsible for a monthly inventory storage fee, which is based on the average amount of space your inventory takes up in the warehouse. This volume is calculated when inventory is fully packaged and ready to ship, according to Amazon FBA requirements.

Before you choose, you can use Viral Launch’s Amazon FBA Calculator to estimate fulfillment fees for listed items that are similar to your product. You can compare them to the costs of fulfilling orders yourself by using Amazon’s FBA Revenue Calculator.

Weighing FBA Pros and Cons

There’s a certain amount of convenience that comes with having Amazon keep, package, and ship your inventory to your customers on your behalf. For example, when you opt into the FBA process, you instantly gain access to lower overall shipping rates, hands-off purchase fulfillment, and several other benefits. You’ll also get to:

  • Make your products Prime: An analysis of buyer shopping patterns for Amazon revealed that Prime members spend about twice as much as nonmembers (an annual average of $1,400 versus $600, respectively). When you sign up for Amazon FBA, your products automatically become part of the Prime marketplace.
  • Win the Buy Box more often: When buyers search for an item that multiple sellers have available, most purchase the item from the Buy Box. Sellers that sign up for FBA have a higher chance of winning the Buy Box than other sellers, even if their items have a slightly higher price tag.
  • Fulfill orders from other websites: Many Amazon sellers have stores on more than just Amazon’s marketplace. If you do, then multichannel fulfillment may be the greatest benefit to choosing FBA. You can take advantage of Amazon’s lower-than-average shipping rates to fulfill orders from your own website and other e-commerce sites.

These advantages (among others) can make running your e-commerce business a breeze, but FBA also comes with a few cons. For instance, the fees and fulfillment costs associated with the FBA process include having your items shipped to the fulfillment center, and you don’t get to choose the warehouse. Consider that you’ll also have to:

  • Take a step back from inventory: Having Amazon fulfill your orders also means giving up much of your physical access to your products. This may make it more challenging to track specific items and orders, and you’ll have to rely on Amazon to resolve any issues involving inventory or order fulfillment.
  • Keep up with tax obligations: Until you enable and set up Amazon’s sales tax collection, Amazon won’t automatically collect sales taxes for your products. You’ll have to collect sales tax from buyers in and out of the state in which Amazon stores your products. Therefore, it’s important that you fully understand your tax obligations.
  • Prepare and label your items: Part of handling your inventory includes assigning appropriate barcodes to each item so Amazon knows what to pick. You may have to opt for Amazon’s FBA Label Service to ensure accuracy. Or you can speak to your manufacturer about providing labels at a lower cost.

Enrolling Your Products in Amazon FBA

Perhaps you’ve weighed the pros and cons and decided Amazon FBA is the right process for your products. Now, it’s time to put that process into action. After you’ve added a product to Seller Central and created its listing, you can enroll it in FBA by first going to “Inventory,” then clicking “Manage Inventory,” and finally selecting “Send Inventory.”

From here, you can enter your ship-from address — likely your manufacturer’s address. You can also enter the number of units you’re sending to Amazon and who will be responsible for preparing and labeling them (you or Amazon). Then, print labels to send your manufacturer, and you’ll be assigned a warehouse to ship your products to.

Keep in mind that some products require specific preparation so that they arrive at the Amazon fulfillment center in good condition. You can provide specific prep guidance and instructions in the “prepare products” step when creating your shipment, with the option of having Amazon do the prep work for a per-item fee.
For more detailed instructions or for help finding a winning product to sell through the Amazon FBA process, start a free trial today.

How To Use Amazon Competitor Research Tools

As a new seller on Amazon, you’re probably eager to break into the marketplace and start moving products. But there’s one major challenge that stands in your way: competition. The Amazon marketplace is giant, and it’s only getting bigger. As of the first quarter of 2020, third-party sellers make up 52% of paid units sold on Amazon, and that number will keep going up.

Just because the market is crowded, however, doesn’t mean new sellers can’t find an in. They just have to learn to use the competition to their advantage — with Amazon competitor research tools. A competitor analysis of Amazon is the best way for new sellers to maximize the effectiveness of their listings and get ahead of the competition.

Don’t get stuck in a spot where you create a product listing and don’t know what to do next. Learn to be savvy about the competition with a high-quality Amazon seller competitor analysis, and carve out a spot for yourself in the marketplace.

 

Enter the Solution: Competitor Intelligence

Our Amazon competitor research tool, Competitor Intelligence, gives you the best shot at cutting through that market chaos and finding success among fierce competition. Essentially, Competitor Intelligence allows you to compare your listings to competitors’ listings by giving you an actionable Amazon seller competitor analysis to inform your strategy.

Get the Fullest Picture With Product Analysis

You can review how your product listing compares to competitor listings in the Product Analysis tab in Competitor Intelligence. You can contrast various information such as price, review quantity, review rating, listing copy, and images. This tool allows you to quickly see which keywords your competitors are ranking highly for — even if you’re not tracking those keywords. This makes it simple for you to see where you have potential to create selling points against them.

For instance, can you offer a lower price, even if it’s only temporary? Can you upload objectively better product photos? Is the quality of your product better? Product Analysis helps you isolate tangible advantages that you can highlight to drive sales.

Keep Track of Competitors’ Keyword Rankings

Then, you can do deeper competitor research to dissect competitors’ strategies using the Competitor Keywords tab. Competitor Intelligence allows you to find competitors’ most important keywords in under a minute. It shows you every keyword a competing product currently ranks for. Unlike other keyword research tools, it shows you what a competitor has ranked for historically. This gives you a more comprehensive view of a competitor’s overall advertising strategy.

Now, as a new seller, it’s unlikely that you’ll be able to jump in right away and dominate those primary keyword areas, but you can use comprehensive competitor keyword data from Competitor Intelligence to find out which keywords competitors aren’t targeting.

These lower-volume keywords may not necessarily have the same sales potential as the ones your competitors are targeting, but they can still drive some conversions for you at a lower advertising cost and with fewer competitors. As you gain visibility and drive sales through these keywords, you’ll begin to generate reviews and raise your organic search rankings.

Over time, you’ll build up your sales history and accumulate enough reviews to begin tackling some larger keyword areas and competing with the big guys.

 

Tracking Competitors in Real Time

Competitor Intelligence is also the only Amazon competitor research tool that updates you daily, or even hourly, on changes in important competitor data.

Product notifications alert you when a top competitor raises its prices, for instance, so you can take advantage of that as soon as possible. Keyword notifications also alert you when a competitor’s keyword rankings change, allowing you to stay up to date at all times without having to manually check the competitor’s rankings throughout the day. Competitor Intelligence is the only tool out there that will give you this real-time view of the landscape, and with it, you’ll be able to react quickly and effectively to optimize your products.

Valuable competitor analysis on Amazon will give you insights into both how your products compare to other listings and how your competitors interact with the market. Competitor Intelligence offers this through unmatched product analysis and competitor keyword research.

It may be unrealistic to expect to jump right in and sell alongside your top competitors, but the right data can reveal the best opportunities. Once you’re in, Competitor Intelligence will inform your strategy as you build your products up to the top of the increasingly crowded Amazon marketplace. And the earlier you start, the better.

See the tool in action today for FREE with a trial of the Viral Launch platform.

Amazon Strategies for Enterprise Brands Affected by The Success of Third-Party Sellers

The “strange and remarkable” rise of third-party Amazon sellers is expected to be a major factor when it comes to Amazon strategies for enterprise companies.

Major brands are now facing some serious competition on Amazon from what has up until now been an unlikely source. Third-party sellers now account for over half of the paid sales on Amazon and this momentum has been gradually building for the last two decades.

In a recent letter to shareholders, Amazon CEO Jeff Bezos’s stated that, “Third-party sellers are kicking our first party butt. Badly.”

The letter starts off with some data showing how third-party sales have increased from 3% in 1999 to 58% in 2018. Bezos describes this massive increase as “strange and remarkable.”

It’s definitely remarkable, but if we take a look at what’s behind the data, it’s not really that strange. It’s also not a fluke. Third-party brands have been able to find success on Amazon for a number of reasons, in part due to their own ingenuity and the array of tools Amazon and emerging software companies are providing them.

How 3P Sellers Are Winning

In Bezos’s letter, he acknowledges Amazon’s role in the rise of third-party brands: “We helped independent sellers compete against our first-party business by investing in and offering them the very best selling tools we could imagine and build” (emphasis original). In other words, Amazon itself has given these independent sellers the means to grow their business and become competitive with enterprise companies.

He goes on to specifically mention Fulfillment by Amazon (FBA) and the Prime membership program, which have both played a role in third-party success. Yet the Brand Analytics feature has also provided major advantages, along with the tools available within Seller Central.  

Third-party brands have taken full advantage of these features to broaden their products’ visibility and increase their sales. Using Seller Central’s product-targeting capabilities, brands can focus on the product pages where they want their sponsored ads to appear. When a third-party brand’s ad appears on an enterprise brand’s page, and that third-party has a better offer, consumers will likely check out the ad and leave the larger brand behind. It’s these kinds of opportunities that the smaller brands are stealing from enterprise companies.

As third-party brands increase their sales, this in turn boosts their product rankings, which increases their visibility. This helps drive more sales, and a self-perpetuating cycle is under way.

Smaller brands also have an advantage over enterprise companies in that they can take a nimble approach to making pricing adjustments. Since large brands have to keep their retail and e-commerce prices consistent, their hands are tied when it comes to price adjustments. Third-party brands, however, can adjust their prices based on seasonality or special offers. By being able to take these kinds of actions they can position themselves to better reach consumers and outpace larger competitors.

Additionally, a big reason why third-party brands are doing so well is due to what the larger brands are not doing. They’re missing opportunities that they may not even be aware of. The advertising channels within Amazon and the growing ecosystem of solution providers can enable a business to get its products in front of its target consumers and increase their potential for sales. As long as the major brands neglect these opportunities, they’ll see their paid Amazon sales continue to drop to smaller percentages. Larger brands may also have a narrow view of who their competitors really are, without realizing that their market could be a mix of both first- and third-party sellers.

It’s Not All Bad News for Amazon

Despite Bezos’s characterization of this as a butt kicking, the success of third-party success is also a success for Amazon. They’re collecting a lot of FBA fees from the third-party sellers who choose to use that program, which hands over product fulfillment responsibilities from the seller to Amazon.

Amazon also seems to be preparing for more third-party brands to join their marketplace. Brand Analytics has recently expanded to include two new features, enabling sellers to gain data about their competitors and customers. It’s possible that further features will be on the way to help brands of all sizes devise new ways to drive ranking and sales. By providing third-party sellers with more pathways to drive success, Amazon is setting the stage to boost their own growth and profitability.

How to Revise Your Amazon Strategy

The time for enterprise companies to rethink their Amazon efforts is now. Learning, adapting, and improving are important for success in any field, and first-party brands will have to start practicing some new tactics, including efficient advertising campaigns, to maintain leadership in their market.Those who take a static approach and rely on previously successful approaches may see their profits stagnate, or if growth occurs, it likely won’t be as great as it could be.

Viral Launch’s recently published white paper, The Enterprise Brands’ Guide to Improving Amazon Sales, covers how large brands should reconsider their Amazon strategies. It outlines how third-party sellers have taken advantage of Amazon’s features to rank for the top keywords, expand their visibility, and take market share away from larger brands. Based on our wealth of data and experience, the white paper also outlines our strategy for increasing rank and sales for brands of any size.

By this time next year, we’ll likely see whether that first-party brands are taking this recent news seriously or if third-party sellers are continuing to drive the majority of Amazon sales. This gradual dominance of the small- to medium-sized brands may become the new normal, unless the larger enterprise companies find a way to learn some new, more agile approaches and reduce the sales of smaller competitors.

Aggressive Growth Strategies To Build Profitable Sales

After launching a new product and implementing strategies to generate reviews and early sales, in time, you will have established a great foundation for long-term product growth. At this point, it’s time to begin building on that foundation to achieve favorable keyword ranking and drive considerable sales growth.

Though you may have a mountain to climb to make your listing the ‘top dog’ in your category, the beginning of this journey is the slowest and most difficult part. Now that you’ve laid the groundwork for a successful product, it’s time to start implementing tactics to accelerate your momentum.

While you still may have a ways to go before you can consider this product a success, after you’ve gathered some initial reviews and are driving some sales, that momentum can be utilized to drive accelerating growth with the following tactics.


Price Testing

Establishing a low price is a great metric for generating sales in the early stages of a listing, providing a tangible value proposition to lure price-conscious buyers away from your competition. That said, while it’s critically important that you price appropriately for the market, you may have not started at a price which provides you with a healthy margin for profit.

Considering that Amazon is first and foremost a search engine for products, ensuring that you’re favorably ranked in search results should be your key objective. In order to rank well, you need to sell well. Keep this in mind when experimenting with price.

Assuming that you’ve gathered a reasonable base of reviews and that you’re consistently driving some sales, you may be able to experiment with different pricing options.

As you’re able to position your product more competitively in the market, the instinct may be to immediately raise your price to the ideal level. That said, your conversion rate may still be relatively price contingent, meaning that you can experience a steep drop-off in sales. Additionally, Amazon’s algorithms are typically not favorable towards dramatic price swings and a steep price increase can sometimes result in a loss of buy box control (even if you are the sole seller on the listing).

Instead, it’s recommended that you slowly step-up price over a longer duration while closely watching your performance and conversion metrics. The main priority is to retain forward momentum so if you start to see sales engagement decline as your price rises, you may consider reverting to a low price or experimenting with coupon offers as a means of maintaining your progress.

While you may have more flexibility in pricing as your listing matures, sales velocity and ranking should still be at the forefront of your mindset. Selling more units at a thinner margin should trump your price point in order to continue to establish your listing in the market. This is once again an instance in which you should be thinking about the long-term strategy for your product.

Aggressive PPC Tactics

Assuming you had established some advertising campaigns shortly after launching your product, you should now have a foundation of data from which to more aggressively pursue PPC. While the purpose of PPC in the early phases of your listing was to gain some visibility and give your product the opportunity to sell, as your listing becomes more established, that strategy should begin to shift to more aggressive tactics centered around driving ranking.

The endgame of establishing and maintaining favorable SEO ranking is the listing’s ability to obtain a growing quantity of organic sales. Because of this, it’s important to review your campaigns in tandem with organic performance.

To provide some perspective, prior to e-commerce, if a brand wanted to advertise their product, they would purchase a tv/radio/print ad and develop a message to be distributed through the channel. In order to gauge the value of that investment, they would need to review sales data to see if there was a correlation between their advertising and an increase in sales.

When advertising on Amazon, you’re able to see an exact return on your advertising spend (ACoS). While this is a great metric to review, it’s easy to get fixated on this spend amount. If your ACoS is high, it’s an easy justification for ending your campaign. The problem is that ACoS doesn’t show you the full impact of your advertising efforts.

It’s also important (and contrary to Amazon’s position) to note that Amazon is not an adequate platform for driving brand awareness. Because PPC provides you with very limited creative capability, it’s exceptionally hard for a private label seller to establish an adequate brand voice. Some of this can be done through social media engagement and more traditional advertising tactics but your on-Amazon advertising strategy should be focused on SEO and sales growth rather than trying to build a base of loyal customers.

At this stage in your product’s lifecycle, it’s important to begin to compile high performing keywords to focus ad spend on while simultaneously understanding the less tangible benefits of advertising. Attention should be placed on both maximizing profitable revenue from easy wins, and developing strategic tactics to advantageously position you across your entire market.

Manual Targeting

When spending on advertising, rather than thinking of it in the context of spending to increase sales, it can be valuable to understand it as buying data from Amazon. When you allow an advertising campaign to run, you’re able to collect a large amount of information about how shoppers perceive your listing. By using your advertising reports as a resource, you can better understand what keywords are most effectively luring buyers to your account and how to more efficiently direct your spend.

Assuming that you’ve been running automatic, discovery, and product targeting campaigns, you should progressively be collecting a large amount of data around your campaign performance. To access that data, you’ll want to download advertising reports from the Business Reports tab in your seller central account.

There are different types of reports which provide different information but one of the most valuable is the Search Term report for sponsored products. From this data, you can determine which keywords are driving sales and how effectively.

As you collect more data through the use of PPC, you should begin to isolate terms that convert well for your product. These terms can be the basis of developing effective and profitable campaigns. Essentially, if a keyword is consistently generating sales at a relatively low ACoS, there can be some assumption that it will continue to perform in that manner. It’s important to note that you’re still going to want to regularly review the data to ensure that it’s maintaining performance, but if keywords are consistently performing at a profitable ACoS, you can assume that they will continue to do so.

In these instances, breaking these keywords out of your automatic or discovery campaigns and placing them in their own manual targeting campaign with a dedicated budget can be advantageous. In this way, you can ensure that a dedicated budget is being implemented to drive a continuous return. Ideally, performance for the keyword will remain stable, meaning that you’re effectively putting one dollar in to get two dollars out.

If this trend continues and ACoS continues to be profitable, the next step is to simply ensure that the campaign isn’t running out of budget on a daily basis. If you’re running out of budget on a profitable campaign, it means that you’re missing the opportunity to maximize sales and revenue from it. That said, the number of impressions that your ad receives is contingent on how frequently a term is searched. For lower volume keywords, a term may only be searched a few times per day, meaning that your ad can generate profitable sales, but not at a high volume. Essentially, this means that there is a limit to how much you actually can spend when directly targeting a keyword, but assuming it’s profitable to do so, it’s advantageous to make sure you’re maximizing that potential.

Ideally, in time, more of your budget will be tied to singular high performing keywords, effectively playing to your strengths and driving a decent volume of profitable sales. As you drive more sales, your listing will continue to climb in ranking, accumulate reviews, and establish a extensive sales history. This may afford you opportunities to convert better and gain more relevance with higher volume search terms for which your product previously didn’t perform as well for. In other words, as your product receives more reviews and is better positioned in the market in terms of competitiveness, you may consider running advertising on higher volume and more competitive search terms.

Search Engine Optimization

The first benefit of advertising (beyond the direct sales driven through your ads) is that it contributes to Amazon SEO. Typically, and while sales obviously have a stronger impact, any engagement with a listing positively impacts keyword ranking. An accumulation of clicks, add-to-carts, and sales in time will help to drive your listing closer to the top of relevant search results. This is especially true when your ad is engaged with through a specific search term. However, keywords that get an excess number of clicks with few to no orders will likely result in negative rank movement. Simply spending hundreds of dollars inefficiently on a single keyword is not the magic bullet to rank improvements; you must convert for the term as well.

While it’s not advisable to spend money blindly on inefficient campaigns, when monitoring keyword ranking improvement and organic sales growth alongside campaign performance, you may find that there is a net benefit to a campaign with a higher ACoS. A keyword tracking tool such as Keyword Manager can be extremely helpful for monitoring ranking changes in correlation with ad spend.

Spending to Facilitate Organic Sales Growth

Along with driving organic ranking for your product, advertising spend can in-turn influence organic sales growth. This somewhat follows the logic of traditional (pre-e-commerce) advertising.

While obviously, establishing better keyword ranking establishes better visibility in the market, which correlates to more organic sales, there is also the less calculable idea that running advertising increases your visibility with consumers. Because repetition influences mental processes, it’s possible that by running advertising, a shopper may overlook your paid ad spot but end up purchasing after viewing the organic listing. In this way, PPC can partially function similarly to a billboard.

Additionally, while this happens more heavily with higher cost products, it’s common for shoppers to browse and consider a purchase over a period of time. As a result, it’s possible that shoppers are viewing (and possibly clicking on) your ads without making a purchase at that time. At the point where a purchasing decision is made, it’s possible that they would click on your organically ranked listing and/or searched for your product directly.

Defensive Ad Spending

Particularly in instances where you’re performing well and/or have enough of a brand presence where people search directly for your brand or products, using ads as a defensive measure can be an effective way to maintain market share.

When a shopper is searching for a product, on any given page there is a limited number of ad spaces available. Though you may be in an advantageous organic positioning for some of these terms, aggressively advertising can be an effective way to suppress competition and ensure a better probability that your product is purchased. With this tactic, the focus may not be on profitable spending (particularly though the campaign performance itself) but rather as a method of affirming broad performance for your product by dominating the paid digital shelf space.

Especially in instances where you have several products that are relevant to a search term, defensive ad spend can help influence shopping decisions by establishing high visibility for your brand. By holding multiple ad spots within the search results, repetition can help to lure buyers into exploring your brand more thoroughly while simultaneously preventing others from gaining the same degree of visibility.

Conclusion

Putting in the effort to source a product strategically, thoroughly research the keyword market, and lay the foundation for sales and review generation should put you in a position to eventually reap the rewards of your hard work. With that context, at this stage in your listing’s life on Amazon, you can begin to shift your strategy to more aggressive tactics. By reviewing your performance and campaign data, you can begin to isolate profitable keywords which you can exploit in order to maximize profitable revenue while simultaneously looking at the total influence of PPC spend with relation to organic sales and ranking.

Using these tactics, you can begin to push your listing to visible and favorable ranking position, grow your organic sales potential, and attempt to minimize the visibility of your competition.

These tactics will, in time, help to drive a listing from the back of the catalog to a major contender in the market. While this process can take time, money, and effort, this long-term strategic play will eventually help a listing to truly dominate the market.

By maintaining some aspects of the traditional school of thought on the benefits of advertising while also appreciating the depth of data that PPC provides, advertising on Amazon can provide you with a wealth of advantages in a congested market.

The Early Phases of Sales Generation

You’ve spent countless hours researching markets. You’ve found a product and a supplier to make it. You’ve ordered samples, finalized the design and packaging, researched the keywords, built an awesome listing, and now your product is finally live on Amazon.

…Now what?

In the endless sea of products being sold on Amazon, it’s unlikely that your product will magically float to the top, but you also need to take steps to ensure that it doesn’t sink to the bottom.

Further keeping with the metaphor, Amazon’s sea can be cruel and unfair, but it demands respect. Established products frequently have reviews that were purchased or incentivised, providing a continued advantage over the competition. Today, several sellers still obviously violate Amazon’s thorough and complicated policies in an effort to get a leg up on their competition. There are regularly new tactics and services to buy reviews, influence metrics, and sabotage listings, and while some sellers seemingly exploit these options with impunity, Amazon does serve as an aggressive judge, jury, and executioner when black-hat tactics are discovered. In the blink of an eye, Amazon can shutter your store and revoke access to their marketplace, and it’s not uncommon that honest sellers find themselves caught in Amazon’s net and hit with account suspensions. Despite all of this, Amazon’s dominance over e-commerce continues to grow, providing unparalleled opportunity for sellers.

Assuming (and highly recommending) that you are playing by Amazon’s rules, when launching a new product, you’re faced with the task of cutting through all of the more established competition to get your product in front of customers. While it’s hard to definitively prove, and while you shouldn’t expect a major influx of sales, it’s commonly believed that Amazon does provide a ‘honeymoon period’ to new products, in which they are given a bit of a boost in visibility and performance to help them gain traction. That said, it’s important to implement every tactic possible to drive sales in the first few weeks of activity. If you are unable to drive any account activity, in time, your poor sales history can begin to weigh on your product’s ability to gain favorability with Amazon’s search engine.

The following article will walk you through the first actions that should be taken when launching a new product. Whether you’re a new seller with your first product, or simply adding an additional listing to a large catalog, these universal strategies can help you to build the necessary foundation of sales and ranking traction to succeed long term.

Competitive Analysis

The first step in developing an effective strategy for launching a new product on the Amazon marketplace is to develop a deep understanding of your competition. When releasing a brand new product, your listing will have no reviews or sales history and your competition may be well established in the market. Therefore, it’s likely that in a head-to-head comparison, your competition is going to have the upper hand.

That said, there are a number of tactics that can be implemented to either circumvent your competition or exploit their weaknesses. In order to do this, you must first understand your competitors and how they are interacting with the market. Using Competitor Intelligence, you can easily analyze the tactics of your competition to build a thorough strategy.

The primary benefit of Competitor Intelligence is that it provides you with in depth keyword data for a competing listing. This data enables you to view relevant keywords for the market in relation to their performance. You can see the listing’s organic ranking and advertising rank (PPC positioning) for each keyword, alongside search volume metrics, opportunity score, and relevancy score.

By comparing search volume to organic ranking and ad strategy, you can start to develop an understanding of what keywords are driving the bulk of sales for your competitor and see an overview of where they’re focusing their advertising budget.

Along with this, you can also observe the keywords that your competitor is not indexing or ranking for. This data can also be important as you may be able to note keywords which are being overlooked, implying that these search terms can be efficient opportunities for driving additional sales!

You’re also able to select and track individual keywords in order to receive updates on rank change, indexing changes, etc., allowing you to quickly adapt to any fluctuations in the market or strategy of your competitor.

On the Product Analysis page, you can directly compare metrics with your competition while reviewing historical trends. With a new product, this data can be a quick and easy method of understanding any competitive advantage that you may be able to emphasize in order to persuade buyers.

Pricing

When first launching a new product, you will have no reviews and no sales history. While your product may be the best product in the market, you will have no explicit advantage over established product listings.

Although you can (and absolutely should) implement quality images and use your copy to highlight features that demonstrate superior value or quality in comparison to your competitors, ultimately the search results on Amazon provide shoppers with:

  • One image
  • Title
  • Prime eligibility
  • Selling price
  • Review rating/quantity

This means that your ability to provide a complete value proposition to potential shoppers is relatively limited. Through this lens, one of the easiest ways to begin to build traction for a new product is to start off by pricing competitively.

Setting a product’s price point below your competition is one of the best methods to draw sales away from more established listings. While it’s very unlikely that your product is review competitive, and similarly unlikely that you will have better ranking than much of the competition, appealing to value can help to draw in more budget minded shoppers.

The social proof provided by reviews helps to provide quality assurance to shoppers, meaning that even if your product is objectively better, a competitor’s review status makes their product less of a risk. Because of this, beating your competition on price provides an alternative comparable tangible value, which has the potential to objectively influence sales.

While it can be a difficult decision for any brand owner to cut into their profit margin, one of the most fundamental mistakes that a seller can make is thinking in the short term. It takes time, effort, and money to build a business. You may not obtain the expected return from your first run of inventory, but taking measures to steadily gather sales in the early stages of your product can be a strategic investment to build a foundation for long term success.

Although traditional business rhetoric would suggest that lowering your price immediately tarnishes the perception of premium branding, this is not the case on Amazon. In a crowded marketplace with limited control over your brand’s messaging, a low price is a powerful asset for driving traffic to the listing.

Keep in mind through this stage that your price is not permanent. As your product begins to gain momentum, you can start to raise price until you hit the amount that you’re ideally shooting for. That said, it’s important to understand that the market dictates price. While you (more or less) have the ability to sell your product at any price you wish, the overall field of competition really establishes the fair market value. At every stage of your product’s lifecycle, it’s crucial to consider this when deciding on your selling price. In order to sell effectively, you will always need to remain competitive with the market.

Additionally, testing a few price points can be worthwhile. In certain instances/markets, an aggressively low price may work against you as it can create the perception that a product is of lower quality. For instance, an extremely low price and no reviews may be a cause for caution with an ingestible product such as a supplement. It’s important to make sure that you’re monitoring data to ensure that you’re getting improved click through and conversion rate (unit session percentage) to develop evidence to support the effectiveness of your price point.

Also, lowering price alone will not help to put your product in front of consumers. It will only help persuade shoppers to select your listing over a competitor. You need to combine a low price offer with marketing and advertising strategies to drive sales. For these reasons, it’s extremely important to make sure that you’re monitoring performance. If you’re failing to keep a close eye on performance and the overall effects of any variable changes on Amazon, you could be missing out on critical data to help you sell more efficiently.

Review Generation

Providing a value appeal to shoppers can be an effective strategy in response to the review quantities of competing products, but that still begs the question: How do you generate reviews?

Prior to an October, 2016 change to Amazon’s terms of service, building a base of reviews was a simple process. Sellers could simply give away a quantity of products to receive ‘honest, unbiased reviews’, effectively buying a review base. However, in time, consumers and (probably more importantly) news outlets, began to notice that a vast quantity of products being sold on Amazon had massive quantities of reviews that appeared to be purchased or positively influenced, thus implying that consumers cannot trust the statements that are intended to provide them with quality assurance. Because Amazon very transparently prioritizes customer experience over all else, they quickly enacted policies to forbid any incentivized reviews as a response to the criticism.

Unfortunately, sellers quickly learned that typical shoppers don’t leave reviews, meaning that this policy change quickly created a divide between established products with large review quantities, and new products which were subject to organic review growth rates.

Review generation, however, was (and is) an extremely important aspect of selling successfully. Practices for driving fraudulent reviews continues to be driven further and further underground; with Amazon playing cat and mouse, enacting stricter policies and liberally doling out account suspensions.

Reviews are a social currency on Amazon and a review quantity and rating alone can largely make or break a product listing. Like any blackmarket good or service, where there is demand, there are entities who look to profit through offering a supply. To this day, some sellers do venture into black-hat tactics to drive reviews, or use reviews to sabotage competition. And while some sellers are able to slip through the cracks, Amazon typically catches up and dispenses swift justice.

As a (hopefully) honest seller, who is looking to avoid the Amazon’s punitive wrath, opportunities to compliantly stimulate review growth are limited, but extremely valuable.

Entering Amazon’s Early Reviewer Program is the best way to quickly get a start on your review generation. This program was seemingly developed by Amazon as a means of compensating for their strict policy changes by allowing new listings some opportunity to gain momentum. The Early Reviewer Program is eligible to SKUs that sell for more than $15 with less than 5 reviews. Amazon charges $60 per SKU and will run their program for a period of one year, or until five reviews are generated. Through this period, shoppers who purchase the product will receive an email from Amazon offering a $1-3 Amazon gift card in exchange for a review on the product.

While it’s not a magical solution to make you review competitive, the Early Reviewer Program is an affordable opportunity to help get a new product listing started. This small advantage enables you to establish some social proof to help sway customers.

Beyond this, and while it’s somewhat of a grey area with regards to Amazon’s policies, sellers also utilize product inserts and email follow-up campaigns to generate reviews.

With either of these tactics, it’s critical that you utilize completely unbiased language and stay away from statements implying or steering the customer towards positive feedback (ex.: “If you love our product, please leave us a review on Amazon.”). You cannot attempt to route negative reviews to your own customer service and you similarly cannot use language that only encourages reviews based on positive reception. You also cannot offer any sort of gift, coupon, or incentive in exchange for a review (ex.: “Please leave us a review to receive a coupon for a 50% discount on your next purchase.”). Even if you’re looking to provide a free gift or coupon to all buyers, regardless of reviews, it’s advisable to not offer any type of promotion, incentive, or gift while requesting a review.

It’s also worth noting that Amazon is deliberately vague about the overall compliance of follow-up email campaigns. It is directly stated that you cannot incentivize or influence reviews in any way and there are restrictions as to how you can utilize email campaigns (i.e. you cannot use emails correspondence to pull traffic from Amazon or market other products to buyers). We have not encountered any issues with use of unbiased email and insert language but Amazon has been known to test buy products to monitor these tactics.

Building a review base for a new product is quite possibly the biggest challenge that you will face when selling on Amazon. While shoppers place an extraordinarily high value on rating and review quantity when making purchasing decisions, less than one percent of shoppers will leave a review for a product they purchase. That said, in most markets, you don’t need thousands of reviews to effectively sell. You just need enough of a review base to provide confidence to your customers.

The value of reviews definitely can’t be understated and it’s important to use the tools at your disposal to stimulate growth. That said, it’s definitely worth it to abide by Amazon’s policies and approach your product with a long-term perspective. Reviews help to drive sales, but in order to drive reviews, you need people to buy your product. Use the Early Reviewer Program to your advantage but also prioritize strategies to generate sales first, and let the reviews develop over time. While it’s not necessarily fast, this strategic perspective will help to ensure that you’re able to facilitate some sales activity which will continue to build momentum as you progressively accumulate more reviews and better ranking.

Product Targeting

While it’s definitely valuable to understand your market and competition, along with review generation and the use of price as a variable to persuade buyers, it’s equally important to understand how to place your product listing in front of potential shoppers. After all, if the best, lowest priced product has a listing on Amazon, but shoppers can’t find it, can it make a sale?

It’s not good enough to have the best price or the best offering if your listing is buried in the results. You also can’t generate reviews without sales. So, considering the reality that Amazon is an extremely crowded marketplace, and that it’s unlikely that your brand new listing will automatically end up on the first page of relevant search results, you’ll likely need to pay for visibility through Amazon’s advertising platform.

However, before you jump into setting up campaigns, there are a few methods that you can utilize to collect important data and work towards efficient campaign performance.

Using your understanding of the competition and your competitive price point, you can delve into product targeted advertising. A product targeted campaign is a campaign that specifically focuses on another listing. Typically appearing on a listings detail page, a product targeted ad can seek to lure buyers to it’s listing by appealing to a shopper interested in a related product. There are two main tactics to explore when using product targeting.

First of all, you can run campaigns directed at competition. It’s important to note that in order to be effective with this strategy, you need to find products that have good visibility and traction (thus allowing you to piggyback on their traffic) and you also need to have some competitive advantage (lower price, better reviews, features, color etc.) in order to reach and lure shoppers.

For instance, if you’re selling a hammer, and a shopper is viewing a listing for a hammer, in order to pull their interest, your hammer has to be cheaper, better liked, or have visibly better features in order to draw the shoppers focus away from the product that they’re currently viewing.

The second main tactic involves using product targeting to align your product with complementary listings. The same concept applies to selecting complementary products to target in that it’s advantageous to look for products that have a large quantity of sales and page one ranking for valuable keywords. The difference is that instead of trying to pull sales from your competition, with complementary targeting, you’re ideally seeking to have your product purchased in addition to the targeted complement.

An example of this would be running ads for your same hammer, targeting items such as tool belts, tool boxes, or boxes of nails. The idea is that while someone is shopping for a box of nails, they may realize that they also need a hammer, and your ad placement may result in a convenient purchase.

To easily identify competing and complementary products to effectively target through this campaign type, you can use Listing Analyzer by Viral Launch. After running an analysis on your listing, you can use the Competing and Complementary Products tab to view and sort related listings. By filtering these results to meet your objective (higher sale price, high sales volume, etc.) you can quickly identify ASINs to hone in on with product targeted campaigns.

While both of these tactics may result in lower engagement, and typically won’t assist organic visibility growth as much as keyword targeted campaigns, they can help you drive some additional sales. Additionally, product targeting can be helpful when first launching a product because you’re able to specifically align your ads with individual products, allowing you to hone in on products that your listing has a competitive advantage over.

Automatic Campaigns

Another method to effectively cut your teeth in with PPC and gain some additional visibility is through an automatic campaign. Auto campaigns are more or less the ‘easy’ format for running PPC. While manual campaigns provide you with the ability to target specific keywords and products with varying degrees of specificity, an automatic campaign will defer to Amazon’s algorithms to establish targets for your advertising.

While you may instinctively think that it’s a better strategy to fully control your campaign spend and targeting, an automatic campaign can be a helpful way to hit on a broader range of keywords and drive some wider visibility. Additionally, there may be specific keywords that you convert surprisingly well for. Also, because there is less of a targeted approach, your advertising spend will tend to be algorithmically dispersed, which can result in a lower cost per click, meaning that it’s possible to continue running very efficient automatic campaigns over a long-term period as a means of increasing and rounding out traffic.

In addition to this, it’s important to regularly review your advertising reports. When running ads, it’s easy to get caught up in the concept of spend vs. return. Obviously, inefficient advertising can feel like wasted money. That said, it can be advantageous to instead look at advertising spend as a means of purchasing data. Though it’s far from perfect, Amazon provides access to a number of reports which can give insights into your campaign performance. These reports can be valuable resources for understanding how your product is reacting in the market and how to effectively compete. For instance, using the Advertising search term report, you can review which keywords are getting impressions, driving clicks, and converting into sales.

As you continue to run automatic campaigns, regularly reviewing data can provide you with insights into which keywords are driving revenue, inevitably allowing you to create more focused manual campaigns focused on well performing keywords.

Using automatic campaigns is a great way to familiarize yourself with Amazon’s advertising platform if you are a new seller, and it’s also a great way to begin to generate some sales and visibility if you’re a launching a new product.

Discovery Campaigns

Assuming you’ve done thorough keyword research, running some more specific advertising campaigns, which we refer to as discovery campaigns, is another way to drive focused traffic. A discovery campaign is essentially a manual campaign which is established to test the PPC performance of your high value keywords.

Ideally, you have a list of keywords used to write your product’s listing. Within this list, there should be a range from high competition/high value terms down to low competition/high opportunity terms. Pulling from this list, you can begin to test small groups of keywords (around 5 per campaign) with manual testing to monitor their performance.

By closely reviewing reports, you can begin to determine which keywords are generating interest (by receiving clicks), and which keywords are generating sales. It’s also important to monitor how your budget is being allocated. You may find that a few of your keywords are receiving a very limited amount of impressions (implying that other keywords are consuming your campaign’s budget). If this is the case, you’ll want to restructure your campaign or increase budget to ensure that you’re adequately testing each term.

If a keyword is spending without generating sales, it may be worth removing it from the campaign. That said, the fact that it is spending implies that it’s receiving clicks. For this reason, it may be worth reviewing the competition for this keyword to determine any tangible values that are hurting your listing’s ability to drive a sales.

On the flip side, if a keyword is effectively driving sales, it may be worth breaking the keyword out into its own campaign with a dedicated budget. In this way, you can ensure that you’re dedicating a thorough budget to the terms that are most efficient. If you’re able to maintain ACoS, you may more or less be able to reliably generate profit by fueling these campaigns with spend.

If keywords are not performing, you typically will want to rotate them out of your discovery campaigns, however, you may not want to completely throw the keywords out. As your product begins to build momentum and generate reviews, it’s likely that your listing will convert differently. Therefore, as your listing becomes more competitive in the market, some targets that were previously inefficient may become more relevant.

Conclusion

When launching a new product on Amazon, there are three major variables that you should immediately begin focusing on:

  • Competitive advantage: Understanding how to position your product with a tangible value proposition (most commonly achieved by pricing below your competition)
  • Review Generation: Given the Amazon’s restrictive policies around reviews in parallel with their importance to consumer decision making process, using every policy compliant tactic to your advantage in order to grow a review base is critically valuable and continues to improve your listing’s ability to sell effectively.
  • Visibility: You cannot expect shoppers to find your product simply because you’re listing it on Amazon. Using PPC to drive visibility is one of the only ways to truly get your product in front of consumers when launching a new product. Knowing how to set up some basic early campaigns to begin to target keywords and advantageously align your product with other listings in the market is the best way to begin to drive revenue.

Keeping these three points in mind when launching a new product can help you to contextualize an overall strategy for effective product growth. Amazon is crowded and your competition won’t always play by the rules. But by approaching the market strategically, and with thought towards the long term, there is still limitless opportunity to be successful.

As more of a moral point, reviews are consistently the most challenging aspect of beginning an Amazon based business. That said, while our increasingly Amazon-based society relies on reviews to inform our purchasing decisions, most of us are guilty of not contributing by adding our own opinions after purchasing products. If it were a cultural norm for shoppers to leave a review, consumers would benefit from more well rounded recommendations, and small businesses would more easily be able to establish themselves.

While lofty and idealistic, maybe reviews should almost culturally be viewed as a tax; a few minutes taken to write your opinion in exchange for the overwhelming convenience of e-commerce. While that may be too ambitious to actualize, taking a few minutes to think about how much a review can mean to the plethora of small business owners who are grinding to achieve success is worthwhile. Though it’s easy to forget, lending a hand by leaving a review makes it that much easier for someone to overcome one of the many hurdles that come with deciding to start your own business.

If you are in the process of launching a new product or are interested in selling on Amazon, Viral Launch is always willing to assist. Feel free to contact us at service@viral-launch.com with any Amazon related questions. Our expert team of coaches are excited to help you dominate!

The Science of Search: Advanced Amazon Keyword Research Tactics

We are taking a deep dive into the foundation of every successful strategy on Amazon: keyword research.


When looking to private label a product on Amazon, it’s extremely evident that the markets are flooded. Now more than ever, it can be an incredibly difficult feat to drive sales for a new product with no reviews and no sales history. That said, there is still a (literal) wealth of opportunity in the Amazon space for savvy sellers who package a well developed strategy with their product offering.

At Viral Launch, we’ve seen one recurring fundamental reason for a product’s failure on Amazon… lack of strategy. It’s not good enough to source a product, throw up a listing, and wait for the sales, and (perhaps unfortunately) focusing on sourcing a product that’s objectively ‘different’ or ‘better’ than your competition doesn’t matter much when you’re given one image and around 100 characters to draw the attention of shoppers.

Everything on Amazon comes down to strategy, and strategy is the result of thorough research. Sourcing the right product and ensuring that it’s positioned correctly in the market is the key to driving success on Amazon. While we have recently published two lengthy posts which cover how to generate product ideas and how to launch and rank products, due to ever increasing importance, we’ll be taking a deep dive into the foundation of every successful strategy on Amazon: keyword research.

The Strategy Behind a Well Crafted Listing

It’s important to recognize that while many people think of Amazon as more of a digital store, the reality is that Amazon.com is first and foremost a search engine. For this reason, when creating a product listing, it’s important to understand that your written content must serve dual purposes.

The first purpose is to produce an attractive listing. Like an advertisement for your product, you need to ensure that you’re using persuasive language and providing a value proposition to help sell your product. If your content doesn’t make sense, doesn’t read attractively, or doesn’t adequately explain the tangible value of the product, shoppers will inevitably be inclined to choose a different product.

The second purpose of your listing is to appeal to Amazon’s search engine. Because your product is inevitably found through customer search queries, ensuring that you’re understanding the keywords that shoppers are using to find your product (and understanding how to prioritize them in your listing) is critically important for driving success. With this, diversifying your keywords as much as possible helps you to index within the results of more searches, thus widening your listing’s potential visibility.

Ultimately, a well optimized listing (a balance between keyword rich content and sales language) is the cornerstone of a successful product. If you focus too heavily on making  a persuasive appeal to your shoppers, there is a good chance that you’ll end up limiting the quantity of searches for which your product will be indexed. On the other hand, if you focus too heavily on overloading your listing with high value keywords, it may show up in more searches but it’s likely that the product’s conversion will be low. Even if you can get your listing in front of people, if it doesn’t read well, or draw people in, you’re not going to be able to maximize your sales perspective.

Great listing content is a fusion between art (sales language) and science (keyword research). The art of this equation is something that comes from understanding your product and the benefits, differentiating factors, and qualities that can persuade buyers. The science comes from market research, data analysis, and in most cases, a quality set of tools to help your pursuit.

This article will be addressing the science of keyword research.

Keyword Research

While the purpose of this article is educational and not a sales pitch, and while there are several tool suites that can be utilized to help you conduct research, this article will be referencing the Viral Launch research tools for ease of reference.

While some of this should even be done prior to sourcing a product, when beginning to analyze keyword markets, Keyword Research should be the foundational reference point for building your listing content. To start, you’ll want to search for your product’s primary keyword. This is logically the keyword that you would search if you were looking to buy a product in your market. From there, Keyword Research will populate a list of associated keywords along with key metrics such as search volume, relevancy score, etc.

This list of keywords of populated keywords contains many of the important search terms that you should seek to prioritize in your content. Because Keyword Research is algorithmic, however, you’ll need to review these results to pull out the best keywords to include.

For starters, sort your results by search volume. This should give you the most competitive keywords in your market. These are the terms being searched most heavily by shoppers and have the potential to drive a large volume of sales. That said, they’re also going to be difficult and expensive to rank for, meaning that while it’s important to include these terms in your content, you’re going to want to target some quick-win keywords as well that can help you to drive sales early on.

It’s important to note that you’ll also want to remove any ‘branded’ keywords from consideration. For instance, if you’re selling socks, keywords like ‘Nike socks’ may have high search volume, but since you’re not Nike, these keywords can’t be targeted by your content.

Once you have identified a good selection of high volume keywords, it’s important to now look for keywords with high opportunity. A high opportunity keyword is a keyword that is not included in the content of many/any competing listings. Within Keyword Research, opportunity is scored from 0-1000. Keywords with a 1000 opportunity score means that no listings on page one have this exact phrase keyword included in their content. The lower the score, the more listings include this term.

To identify high opportunity keywords, it’s recommended that you sort by opportunity score, and look for any keyword with an opportunity of 750-1000 with a search volume of at least 1000 searches per month. There are typically plenty of keywords that have high opportunity, but if no one is searching for them, there isn’t much potential to drive sales. Because each section of a listing has a character limit, it’s important to prioritize keywords that have better potential to drive sales (i.e. keywords that have search volume).

Finally, performing a quick review of high priority and high relevancy keywords will help you to catch any other terms that may have been missed. Particularly, priority is determined by assigning a score based on search volume and opportunity, meaning that it will help to show keywords that are easy to rank for while having some degree of customer audience.

It’s also recommended that you repeat this process by searching several high volume keywords within Keyword Research. Though the majority of the keywords should overlap, ensuring that you’re not missing any other valuable keywords can be helpful.

As you collect these keywords, you are able to move them over to your keyword bank, allowing you to create your listing within Listing Builder. You’re also able to copy and/or export your list to a CSV file. It’s highly recommended that you keep an organized record of your targeted keywords for reference for tracking and advertising purposes.

Competitor Intelligence

While using Keyword Research is a great way to understand your market and build a collection of high volume keywords, it’s also important to understand your product market within the context of the competition. By understanding what keywords your competitors are running ads to, driving sales through, prioritizing, and/or ignoring, you can begin to build a strategy around how to position your product within a market.

With Competitor Intelligence, you can review your competition’s keyword data and use their data to your advantage. Through keyword analysis on several market competitors, you can construct keyword lists based on a few different considerations.

Primarily, Competitor Intelligence can show you what keywords are driving sales for your competition. The tool is able to present any listings, organic ranking for each keyword, ad placements, and keyword search volume, allowing you to review and monitor the keywords that correlate to a bulk of your competitor’s sales. Through this, you can start to build a profile of the keywords that drive the most sales for listings in your market and prioritize your listing content accordingly.

Additionally, using Viral Launch’s Reverse ASIN 2.0 technology, Competitor Intelligence will also show relevant keywords for which your competitor is not indexed and/or ranked for. Comparable to opportunity score, if there is little to no search volume for these keywords, they may not be worth prioritizing. However, if your top competitors are missing a few quality keywords in their listing, it may create opportunity for you to drive sales with little competitive resistance. Especially early on in the life of your listing, understanding how to drive easy sales by capitalizing on the missed opportunities of your competition can be a useful tactic to begin building visibility, sales history, and reviews. This data has the power to help you drive sales through opportunities that your competitors don’t even know that they’re missing.

Ultimately, through viewing the keywords that your competitors are using to drive sales, as well as the overlooked keywords which have the potential to drive sales, you can ensure that you’re not missing a single opportunity!

Listing Analyzer

For Existing Product Listings:

If you have an existing product listing that you’re seeking to improve, the best strategy is to start by using Listing Analyzer. By linking your Seller Central account to your Viral Launch account, you’re able to seamlessly pull your product catalog into the Viral Launch interface.

From the Listing Analyzer tab in your Viral Launch dashboard, you can run an analysis on your product. Our software will pull metrics and keyword data from your listing, presenting you with an overview of your product in comparison to the market, along with a listing quality score. Through this tool, your listing’s images, reviews, competitiveness and copy are analyzed and you are also provided with a list of competitive and comparative products.

Additionally (and most importantly within the context of this article), Listing Analyzer will also provide you with an extensive list of keywords which are relevant to your product market. This data is relatively similar to Keyword Research (with regards to the metrics provided), however you are also able to review whether or not the keyword is being utilized in your listing.

From this list, you are able to select keywords that are relevant to your listing and move them into Keyword Manager to monitor, track, and/or incorporate into your listing.

On a final note, it’s important to make sure that you’re putting your best foot forward when it comes to optimizing your listing with the strongest keyword spread possible. That said, if you are working with an older product, particularly if it’s selling relatively well, changing your listing content can create a ‘reshuffling’ of your keywords within Amazon’s system. Because of this, you can sometimes see a short term detriment to ranking and sales as your listing is reincorporated into Amazon’s SEO structure. Therefore, while it can be beneficial in the long term to fully optimize your listing, you may need to weigh this against the potential setbacks to determine if and when to change your content. Ultimately, while this can be a good tactic for working with a new listing, altering your content becomes more complicated as your listing ages.

For a New Product Listing:

If you are beginning your keyword research prior to having an active listing on Amazon, you will want to begin your process by building out your keyword list through the use of Keyword Research and Competitor Intelligence.

Once you have a listing on Amazon, it’s advantageous to run your product listing through Listing Analyzer to further ensure that you’re maximizing your keyword/ranking potential.

While you do need an existing listing in order to run an analysis, it’s worth it to think of Listing Analyzer once your product listing is up on Amazon as a final check to verify listing quality. At this point, you can review the provided keyword data through the tool and make any final adjustments if you notice any missed terms.

Note: If you are running an analysis on a brand new listing, it’s unlikely that you will have a perfect score, as review quantity, revenue generation, etc. in comparison to the market factor in to the assessment. While you want to note these data points as a means of knowing what’s needed to maximize competitiveness for your market, early on, the best use of Listing Analyzer is to verify your keyword list and review competing and complementary products for the purpose of product targeted advertising.

Keyword Manager

Now that your keyword bank is compiled (and hopefully added to your listing), it’s time to start benefiting from your research. Keyword Manager helps you to track your keyword bank and understand how and where you’re driving sales.

Considering it’s almost impossible to go a single day without encountering the immense reach of Amazon, it’s obvious that the largest e-commerce marketplace is also an insanely saturated e-commerce marketplace. While employing thorough keyword research into your listing is a critically important element of success, it is very unlikely that you will magically appear at the top of the search results. Amazon favors products that perform and as a new product, you have to prove that you can get sales in the market in order to gain visibility. Driving sales is not always easy, especially with a new product with no reviews or sales history, but with the proper strategy around marketing and advertising, you can begin to generate sales and improve keyword ranking (thus driving organic visibility).

By utilizing Keyword Manager to track your relevant keywords, you can monitor your progress to better determine which keywords are producing the most growth, and which keywords you’re having more trouble with. You can use this data to develop a strategy to continue building momentum, and you can ensure that you’re not missing a beat by establishing notifications and hourly tracking on your most critical search terms. If your ranking fluctuates, or your ad positioning changes, you’ll be able to respond quickly and efficiently to address the situation.

While Keyword Manager isn’t explicitly a keyword research tool, it’s a great resource for helping you to fully capitalize on your keyword strategy. With the ability to review organic and sponsored positioning, prioritize by opportunity and search volume, and track your movements in your market, Keyword Manager gives you the tools you need to harvest the fruits of your (keyword research) labor.

Conclusion:

As more sellers enter the Amazon marketplace at an accelerating pace, the importance of thorough research and a deep understanding of your product market is crucial for driving success. Robust keyword research is the cornerstone of any successful strategy for launching a product on Amazon. Developing a well prioritized bank of keywords helps you to establish a wide breadth of searches through which you can gain visibility and sales, while also enabling a deeper understanding of how to use PPC and marketing to effectively grow your product.

Ensuring that you have the broadest range of keywords possible, and knowing how all of your keywords interact with the market informs you on how and where to drive sales and ranking. Through adequate keyword research, you can understand where your competition drives sales, which keywords generate the most sales for your market, and which keywords you can most easily gain ranking traction for.

The importance of performing your due diligence when performing keyword research cannot be overstated. Implementation of this process will ensure that you’re well positioned to take on the competition and achieve success with your business. To learn more about how to successfully launch and rank products, check out our blog post here.

The Future of Amazon 2019: 22 Sellers and Thought Leaders Share Their Predictions

For brands and entrepreneurs selling on Amazon, 2018 was a whirlwind of change with increases in competition, old success tactics becoming obsolete, new Amazon programs, and so much more. If history is any indicator, then we can expect even more of these changes in the new year. But what sorts of changes should we expect? How will these changes impact your Amazon business? And what steps should you be taking to prepare for these changes to best get ahead of the competition?

Here at Viral Launch, through helping drive more than $7 billion dollars in Amazon sales, we’re equipped with a vast amount of insight and data. This experience working with thousands of brands (from small private label sellers, to $100m+ 3rd party sellers and world renowned Fortune 100 brands) has enabled us to predict some of the biggest things to come in 2019. And we want to share them with you so that you can prepare for what’s ahead this year.

Not only that, but we teamed up with more than twenty 7, 8, and 9 figure sellers and Amazon thought leaders to get their unique perspectives on what to expect and how to prepare for success in the coming year. So, here are 11 predictions for Amazon in 2019 to inform your business decision making, formulated by Viral Launch and informed by top industry experts.

Click Here to Read the Experts’ Predictions

1. Major Brands Get Smart About Amazon Organic Ranking & Sales

We are predicting there will be more major brands that get smart about Amazon success tactics, putting even more pressure on Amazon sellers!

The reason third-party sellers (the small private label sellers) have had the opportunity to become ecommerce giants (we have a couple private label customers and personal friends that surpassed $100m on Amazon in 2018) is because when Amazon changed the ecommerce game, they changed the necessary tactics that drive success.

In a lot of ways, the primary tactics used in traditional retail – such as paying for shelf space, good in-person packaging, and branding – gave way to lower prices, organic keyword ranking, and pay per click/direct response advertising.

Amazon third-party sellers have been able to drive massive success because their only chance of driving sales among such established players was to become students of the new paradigms of retail success tactics. These sellers have worked diligently to understand the key drivers of Amazon organic keyword ranking and conversions, which has led to significantly greater visibility than their household name competitors.

Major brands continue to use deprecated success techniques, leaving the door wide open for third party sellers to reap the benefits of their Amazon expertise. Major brands typically only pay attention to Amazon PPC as their most impactful lever of driving sales. However, in general, only 15-40% of a product’s sales potential comes from Amazon advertising, while the remaining 60-85% can be found in the organic search results. It’s within this uncontested 60-85% space that third-party sellers have thrived and grown.

We are seeing more of these larger brands realize that there is far more potential beyond just Amazon advertising sales. They are beginning to hire successful Amazon sellers and/or software providers as consultants in order to help them become experts, much like successful third-party sellers. This is causing them to shift their focus from the 15-40% of sales potential to 100% of sales potential.

2. Amazon PPC Becomes Less Profitable But More Important

We are predicting that advertising on Amazon will see an increase in efficiency, significant increases in cost, and a significant increase in importance to success for brands on Amazon.

As Amazon increases their dominance in ecommerce and retail, brands are forced to move more of their budget to Amazon advertising. Significantly increased demand, combined with inefficient spend of untrained brands, will absolutely result in increased CPCs (cost-per-clicks). We’ve been observing this trend for quite some time in many markets, but we expect it to increase in velocity and ubiquity. It’s hard to go more than a week without seeing a new post in the media about Amazon’s advertising platform. With that said, we do think that while costs will increase, efficiency will improve.

Viral Launch still sees significant inefficiencies in general Amazon advertising campaign management, largely due to the limitations of Amazon’s in-house advertising tools and programs as well as a lack of sophisticated ad management and automation alternatives. However, we expect new tools/improved sophistication and functionality in Amazon advertising tools and programs will allow for an improvement in advertising spend efficiency. We also expect Amazon to continue improving their ad targeting technology with new programs and tools which will help brands improve overall spend efficiency.

Additionally, we believe that advertising on Amazon is and will continue to be increasingly more important to being competitive on Amazon. With more ad placements per page, we expect advertising to continue increasing the share of an individual product’s sales potential versus organic sales potential. Advertising can also be an important tool in affecting organic sales. Brands that have been using purely organic traffic to build their business will be forced to become experts at Amazon advertising in order to remain ahead of the competition.

3. The Reign of Building Brands Off Amazon

We are predicting that more Amazon sellers will focus on building brands off of Amazon as the effort/reward ratio continues to improve relative to the ratio of focusing solely on Amazon.

Up until 2018, Viral Launch has been a major advocate for focusing on Amazon and delaying true brand building until you crossed the $10m mark on Amazon. While we had obviously seen a few brands build success using a multi-channel strategy (selling outside of just Amazon), it was extremely rare. Much more frequently, sellers hit 7 and 8 figures ($10,000,000+)  while focused almost exclusivelyon selling on Amazon. Opportunity cost is a powerful metric for optimal decision making, and for the vast majority of sellers, the opportunity cost was too high when focusing off of Amazon. The reason was because selling on Amazon still presented a lot of low hanging fruit and provided revenue growth rates you could hardly ever reach anywhere else.

As selling on Amazon has become increasingly competitive, we feel that the scales of opportunity cost are shifting to point to true brand building as the greater opportunity. Now don’t get me wrong, there are more people spending more money than ever on Amazon. The opportunity is greater than ever, but the cost and effort of seizing the opportunity is also greater than ever (in most markets).


4. Successful Brands Will Continue to Grow Significantly

We are predicting successful sellers/brands will see unparalleled sales volume on Amazon!

While it’s true that selling on Amazon has become more difficult than ever, there are more people spending more money on Amazon than ever before. This trend will continue into 2019, meaning those brands that are able to achieve/maintain top organic ranking positions, as well as perform well in advertising, will see sales volumes at unparalleled levels. The stakes are higher than ever! It truly is an exciting time to be selling successfully on Amazon.

5. Fewer New Entrepreneurs Begin Selling On Amazon

We are predicting fewer new Amazon seller accounts will be created in 2019.

According to Marketplace Pulse there were 1,200,000 Amazon seller accounts created in 2018 (a good portion never saw a sale). We are expecting new account creation to slow down quite a bit.

There are three primary reasons we expect this to happen.

  • Reason 1) Increased Barrier to Entry: the cost and complexity of driving success on Amazon has increased. While we still believe there is a massive amount of opportunity on Amazon still (see Amazon Product Research in 2019), the opportunity generally requires larger budgets and more complex strategy.
  • Reason 2) Market Fatigue: There are only so many aspiring entrepreneurs and mom and pop shops that are interested in selling on Amazon. We are predicting that the interest peaked in these two demographics in 2018.
  • Reason 3) While we are not economists or fortune tellers, the possibility of a global/US based financial downturn is looming. In the event of a financial downturn, we expect people to have less “free cash” available to start an Amazon FBA business.

6. Major Changes in Reviews and Rankings

In 2019, we think Amazon will continue to improve the security/integrity around many systems/processes including their coveted reviews.

While we have been expecting Amazon to make a major systemic change to their review system, we are guessing (and hoping) that 2019 is the year we see this change come to fruition. In 2018 we have seen some review changes, specifically around review locks, in which receiving too many reviews will trigger Amazon to put a lock on new review activity.

We expect many unforeseen changes to take place, however our greatest hope/prediction is for Amazon to change the review system to a LinkedIn-style review cap presented on search results. By this, we mean that on search results pages, we expect Amazon to begin showing review quantities over 1,000 reviews as 1,000+ (or some similar number). You can check out our Amazon review podcast covering why we think this is necessary to protecting the quality of products purchased and the integrity of Amazon’s review platform for more on that topic.  

In short, sellers are incentivized to achieve the highest review quantity relative to their competitors. A higher review quantity indicates greater popularity to potential buyers. If a product has been selling for 10 years on Amazon, it has a distinct advantage over new, and potentially better, products that have not had as long to generate reviews. Let’s say Product A has been on Amazon for 5 years, has a 4.4 star rating, and 6,000 reviews. While Product B has been on Amazon for 6 months, has a 4.8 star rating with 1,000 reviews and a price point $1.00 cheaper than Product A. While most may think Product B is a better product at a better value, there is very little hope of Product B gaining the sales necessary to acquire the reviews to outperform Product A. Product A could allow the quality of their product to decrease because they have such a large review quantity built up that it will be very difficult for others to catch up. It creates a stale market favoring age over quality and value. Limiting to 1,000 reviews shown in the decision process would allow customers to know that a statistically significant number of other customers have purchased/reviewed the product so that review rating must be legitimate.

While we do not have many specific predictions we feel comfortable sharing, we do expect there to be rather significant shake ups in the key drivers of Amazon’s organic keyword ranking algorithm. As in the past, having access to significant amounts of data around key ranking factors/metrics while constantly testing will be the key to staying ahead of any algorithmic changes. Fortunately, Viral Launch has been able to stay abreast of any changes thanks to our wealth of data and brilliant R&D team.

7. Facebook Begins It’s Path of Becoming The Second Largest Ecommerce Site

We are predicting Facebook begins making big moves in ecommerce by subsidizing sales through their platform for merchants to sell direct through their platform.

For the last couple of years, we’ve consistently considered Facebook to be the entity with the greatest potential to challenge Amazon in the world of retail. We’ve lost quite a bit of hope in Walmart and Google over the years. If you think through the core building blocks to a successful ecommerce platform, attention, data, trust, and web/mobile capabilities/technology are top of the list. With more than a purported 2 billion monthly active users, unparalleled data around it’s users, and significant web and mobile technology, Facebook is more than well equipped to help brands sell their goods directly through their platform at a massive scale.

I’m not talking about Facebook’s peer-to-peer marketplace. I’m expecting a full fledged Amazon competitor, and we’re beginning to see the early stages. In some instances, Facebook is reimbursing merchants $5 for each product sold to cover the cost of shipping with no additional marketplace fees, making Facebook a cheaper place to move product already. We’re expecting Facebook to start making some big moves in the e-commerce world in 2019.

8. International Markets are the New Gold Rush

We are predicting a substantial movement of third-party Amazon.com sellers in offering their products and brands on Amazon’s international marketplaces in 2019.   

Selling on Amazon.com (the US marketplace) still poses massive opportunity if played right, but there is no denying that it is certainly more difficult to grasp that opportunity than ever. We expect the real mad rush for low hanging-fruit sales (Amazon “gold”)  will come in Amazon’s international marketplaces. Viral Launch has been a strong advocate of sellers expanding internationally for the last two years, which is why we invested in hiring domestic listing optimization specialists in each country containing a major Amazon marketplace, as well as expanding our tools to work internationally. We have seen success after success with minimal effort and marketing budget in Amazon’s international markets over the last couple of years (check out this incredible story of two 21 year olds achieving 8 figures on Amazon in 2 years, while selling internationally).

As creating and expanding a profitable and high-growth Amazon business becomes more difficult to achieve on Amazon.com, we think 2019 will finally be the year that third-party sellers look to international markets in droves!  Selling internationally certainly has some drawbacks, but in general, Amazon advertising is significantly cheaper, driving organic keyword ranking is significantly easier, and growing top line revenue are all much less competitive relative to Amazon.com. Experienced Amazon.com sellers are able to use their learned success tactics and easily apply them to their brands in International markets.

9. Seller Fulfilled Prime Comes Into Vogue

We are not denying the importance of 1-hour and same day delivery, but we predict we will see a significant amount of sellers over the $1m mark moving to a hybrid fulfillment model.

Over the last 6-9 months, we’ve started to observe a trend in larger/more experienced Amazon third-party sellers moving to the Seller Fulfilled Prime (SFP) model using a combination of their own warehouses and 3rd Party Logistics providers (3PLs). The most compelling reason to move from fulfilling through Amazon’s FBA program to a self-regulated SFP model is cost savings.

We are not seeing only sellers with large items such as furniture moving to SFP, but sellers with products of all weights and dimensions. A customer of ours, selling more than $40m/year on Amazon, claims moving to the Seller Fulfilled Prime model has been his single best investment yet!

The second most common reason sellers are taking up SFP is to support fulfillment for other ecommerce channels that may not allow using Amazon’s Multi-Channel Fulfillment program. Having a dedicated 3PL network allows sellers cheaper fulfillment and greater channel flexibility.

10. More Amazon-Owned Brands

We are predicting there will be a significant increase in the number of Amazon owned (not “sold by Amazon”) in 2019.

We have seen a significant push from Amazon in their own private label brands, and we expect to see this trend continue into 2019. Amazon now has over 80 of their own private label brands, and those brands are receiving better placement than ever (Amazon’s “Our Brands” section now shows above organic results for many search terms).

Amazon kicked off a new program near the end of 2018 called their Accelerator Program, which essentially stands as a partnership between third-parties and Amazon to establish new Amazon-owned brands using existing product performance data. This presents the potential for the number of Amazon owned brands to sky rocket! It will be very interesting to see how this progresses in the new year.

The largest threat to Amazon’s private label brands is likely the government presiding over the country in which each marketplace operates. For example, India has banned Amazon from selling any of its own products on Amazon.in.

11. Less Ads Showing on Page 1 of Search Results

We are predicting Amazon reduces the Amount of clutter in Amazon search results which distracts shoppers from the organic search results.

This is not a common opinion, and we’ll admit that there is a decent amount of logic/data pointing to an extremely high probability that this prediction does not come true, however, when we really try to get in the mind of Amazon and Jeff Bezos, this feels right! I (Casey Gauss) want to walk you through my logic on this one.

As I think through what has made Jeff and Amazon so successful, it’s been their relentless focus on the customer experience (think lower prices, faster shipping, return policy, etc.).

In my opinion, in 2018, the actual shopping experience for customers suffered at the expense of Amazon’s advertising revenue and the promotion of their owned products. There are two contributing factors to what I believe is a lower quality shopping experience.

(One key point to understanding my thoughts below is the difference between “organic results” and “sponsored results”. “Organic results” are the items presented to a customer after typing in a given search term that are showing in the results out of merit. Organic results have been selected by Amazon’s A9 ranking algorithm based on performance factors such as conversion rate, number of units sold, etc. “Sponsored results” are items showing with a “sponsored” denotation, and are showing in the results because merchants have paid for the placement. Theoretically, organic results are the best selling products for a given keyword which is why they are showing in the results. The products most likely to best satisfy the customer’s request. While Sponsored results are artificially placed based on how much the merchant is willing to spend.)

1) Overwhelming Information in Results: In general, our data shows that anywhere between 60-85% of a product’s sales potential come from placement in the organic search results. This means the majority of customers’ shopping experience consists of inputting search terms in the search bar (e.g. “fish oil supplement”), sifting through the results, and purchasing a product. In 2018, we saw an increase in the amount of information being shown on the results page which can be confusing, overwhelming, and a barrier to purchasing the products showing organically (the most likely to satisfy the customer’s request based on real buyer behavior).

The shopping experience is overwhelmed with information and creates a barrier to the shopper arriving at the best performing products based on real data from hundreds to millions of real customers. I feel this direct and indirect inhibition to the best customer experience does not align with Amazon’s mission and what has allowed them to be so successful to date.

2) More Sales Through Amazon Ads: There are more advertising placements on Amazon than ever before. Paid media sales are increasing their market share versus organic sales. When customers are purchasing artificially placed products (products presented through ads versus showing based on performance), the probability of the sponsored product being as high quality as an organically ranked product is low. By more sales being driven through advertising, Amazon is selling less of the proven and theoretically higher quality “organic results” to customers for the sake of driving more advertising revenue. More ad sales = more pay to play, versus quality & value to play.

Now, I don’t think that Amazon has nefarious intentions with advertising. They haven’t set out to create a lower quality shopping experience so they can make a few billion dollars more per year. My assumption (with almost no inside Amazon insight) is that this is a classic case of competition priorities between departments (i.e. the Amazon advertising business units are focused on maximizing their top line, without much focus on the overall customer experience).

Either way, I’m predicting that someone in Amazon, perhaps Mr. Bezos himself, will realize that there has been a slight deviation from the company’s overall focus, and will begin to peel back some of the excessive ad placement.

12. Amazon Significantly Outpaces Other Retailers in an Economic Downturn

We are predicting Amazon significantly outpaces competitors if/when there is a downturn in the US economy.

While we are not economists or fortune tellers, there seems a high probability that there will be an economic downturn of some degree at some point in the near future. If the next economic downturn occurs within 2019, we are predicting Amazon will outperform other retailers significantly. With unbeatable low prices, convenience for working families, and an incredibly large catalog of low priced necessities, we expect Amazon to be the go to store when budgets and time are tight.

Amazon Expert Predictions

Liran Hirschkorn
7 Figure Seller
Seller Coach at Amazing Freedom

  1. Amazon merges Seller Central and Vendor Central into a new system called Vendor One, which gives third party sellers more brand control.
  2. Brands direct more ad traffic to Amazon instead of their own websites, increasing PPC costs.
  3. Amazon shares more data and analytics with sellers.
  4. Amazon private label continues to grow, so sellers source in product niches.

Kevin King
7 Figure Seller
Speaker and Amazon Teacher at AMZMarketer.com and FreedomTicket.com

  1. Sellers need to approach Amazon like a real small business, not a get-rich-quick scheme.
  2. Amazon becomes a pay-to-play advertising platform.
  3. Amazon expands their private label brands.
  4. Amazon merges Seller Central and Vendor Central into one system called Vendor One.
  5. Third Party Sellers undergo an approval process through Vendor One, which means sellers must better conform to guidelines.

Danny McMillan
7 Figure Seller
Host of SellerSessions and Founder of PPC Management Tool Databrill.com

  1. Amazon provides a series of tools to battle black hat tactics and thereby attract new sellers.
  2. Other marketplaces continue to fail to compete with Amazon.
  3. Dayparting, geotargeting, and click-fraud technology for PPC is developed to protect third party sellers.

Ed Rosenberg
7 Figure Amazon Seller
Owner of Asgtg.com, Host of ASGTG Event, and Amazon Compliance Specialist

  1. Amazon makes it difficult to open phantom accounts through voice-match recognition or identifying documentation.
  2. eBay emerges as the most potent competitor for Amazon through a series of mergers and acquisitions.
  3. 3P, private label sellers, find more success in the marketplace than Amazon private label brands.

Adi Singh
8 Figure Amazon Seller

  1. Amazon is a lot more involved with initiatives outside the marketplace (influencers, social media, stores).
  2. International markets play a large role in growth for sellers.
  3. Less buying and selling of Amazon businesses.

Dima Kubrak
7 Figure Amazon Seller

  1. Amazon cracks down on hackers and black hat sellers.
  2. Sellers use outside resources to drive traffic to Amazon.
  3. Amazon focuses on pushing exclusive products by giving sellers more control over their listings.

Cherie Yvette
Amazon PPC Manager for 8 Figure Brands
The Urban Cowgirl, Wild West Media

  1. Sellers face fierce competition on category keywords.
  2. Amazon offers more placements for advertising.
  3. Sellers put more resources into remarketing.

Jamie Davidson
Partners with $100m Amazon Sellers
AMZ Insiders

  1. Video becomes more important for product listings.
  2. Amazon places increased emphasis on quality private label brands.
  3. Chatbots become more important for Amazon businesses.

Ryan Moran
Former 8 Figure Seller and Multiple 7 & 8 Figure Exits
Capitalism.com Host

  1. New private label products trend toward micro-brands.
  2. Specific audiences become more important on the marketplace.
  3. Big brands adjust for online marketplaces.

Kevin David
7 Figure Seller
Teaches 10,000’s of Students on Youtube

  1. Accurate data becomes more important for sellers.
  2. Sellers get more creative with keyword research.
  3. Marketing expansion to sources outside of Amazon.

Anthony Bui-Tran
8 Figure Seller
Seller Tradecraft

  1. Amazon makes changes to Brand Registry and PPC to give private label sellers more control over their brands.
  2. New Amazon accounts become harder to open, which means selling Amazon accounts becomes popular on the black market.
  3. Sellers get better access to honest, accurate review generation incentives.

Tom Wang
7 Figure Seller
Trains Hundreds of Amazon Sellers at EcomHub.com

  1. The marketplaces becomes more competitive with an influx of new sellers.
  2. Sellers learn how to drive traffic off of Amazon.
  3. Black hat tactics become less effective.

John Lawson
World Renowned eCommerce Expert
Host at Watchingamazon.com

  1. The China connection is broken, encouraging online sellers to source from other countries.
  2. An economic downturn creates problems for sellers sourcing less expensive products that are frequently bought on impulse.
  3. Amazon continues to dominate market share.

Leo Sgovio
7 Figure Seller & Speaker
Director of Innovation at Viral Launch

  1. Amazon releases their own suite of tools for advertisers.
  2. Influencer marketing becomes a bigger part of the Amazon seller journey.
  3. Amazon attribution and increased external traffic paves the way for a new referral fee structure.

Dr. Ben
7 Figure Seller
Host of Amazon Mastermind thehivemind.co

  1. Amazon rids the marketplace of black hat and inattentive sellers.
  2. New California sales tax issues force Amazon to collect and remit sales tax on all sales going forward.
  3. Google makes a push into ecommerce using Google Express.

Brock Johnson
7 Figure Amazon Sellers
Training hundreds of Amazon sellers at BrockJohnson.com

  1. Amazon platform reaches a point of saturation in the B2C market, so they start to shift their focus toward sellers.
  2. Sellers become more customer-focused, using tools and strategies to create a good buying experience.
  3. Amazon B2B sector continues to grow, creating huge opportunity on Amazon.

Franky Farina
8 Figure Seller on Amazon
Million Dollar Sellers Group  – 9 Figures in Total Sales

  1. Sellers lose access to customer information, as Amazon will keep that data to themselves.
  2. Amazon continues to remove incentives for stocking inventory at their warehouses, encouraging sellers to turn to other 3PL companies.
  3. Tariffs, Amazon private label expansion, and continued reliance on Amazon advertising platforms continue to shrink seller margins.   

Kevin Pasco & Jeremy Sherk
8 Figure Amazon Sellers
Nested Naturals

  1. New private label brands continue to join the Amazon marketplace.
  2. Amazon continues to place restrictions around review generation to maintain marketplace integrity.
  3. Sellers need to have an audience to launch a new product.   

Nick Young
8 Figure Seller
Seller Tradecraft

  1. Amazon establishes long-term dominance on the platform by incentivizing brands to sell new products on the marketplace.
  2. Amazon makes a big push toward social media.
  3. More brands ship direct to Amazon, spelling the beginning of the end for wholesale.

Fernando Cruz
8 Figure Seller
Seller Tradecraft

  1. Sponsored product ads and AMS become significantly more expensive.
  2. Sellers move toward email lists, ManyChat, and social to market their products.
  3. Growing subset of brands that move away from Amazon as a part of their online strategy.   

Brandon Young
7 Figure Seller
Teaching Amazon at Seller Systems

  1. Amazon changes the way they are indexing and ranking products, which means sellers have to be smart about their sourcing decisions.

Conclusion

As you’ve probably noticed, there was plenty of overlap between Viral Launch’s predictions and those of the included industry experts and thought leaders. I’m not sure if it is fair to say that this indicates the prediction is more likely to come true, but it does indicate that there is likely more data pointing to that assumption.

An underlying commonality throughout these predictions was increased competition, focusing on building traffic off of Amazon, and adapting your Amazon success strategies. There is certainly the opportunity to look at this with a negative outlook on the future, but please do not forget that Amazon is continuing to grow it’s ecommerce footprint significantly.

As the opportunity for incredible degrees of success continue to grow, so does the difficulty of achieving that opportunity. Instead of playing the victim to increased competition and “unfair” changes, the truly successful adapt with the times, play the long game, and focus on solutions.

I want to encourage you to focus on the solutions. How will you diversify your Amazon business? What strategies will you use to guarantee you and your team are staying ahead of the lastest success tactics? How can you drive sales, reviews, and keyword ranking in this new landscape?

While there are many components that comprise a winning strategy for the future, Viral Launch is focused on giving you the data, automation, and thought leadership around topics like driving sales, keyword ranking, and product selection. Now, it’s up to you to use these to stay ahead of the curve and continue growing exponentially on the world’s largest marketplace!