How To Increase Sales on Amazon: What We’ve Learned From Working With 8,000+ Brands

Is your Amazon product stuck in a rut? Selling consistently can be a challenge, and with sales lower than you want them to be, you’re probably left wondering what you’re doing wrong. Your low sales volume could be due to any number of things. Maybe your listing isn’t optimized well for main keywords. Maybe people are choosing to buy a similar product with more reviews. If your stock isn’t moving as fast as you would like, we’ve got some tips to help you learn how to increase sales on Amazon.

Before we begin, it’s worth noting that there’s no one quick fix to increase your product’s sales. Unfortunately, there is no such thing as a silver bullet. Amazon uses a variety of factors to determine which products appear on page one for any specific search. And just because your product is on page one, doesn’t necessarily mean it will convert well. These tips give you a range of ideas that will all work together to help boost your sales.

1. Optimize Your Listing

In order to make sales on Amazon, you have to get your product in front of shoppers. No one is going to buy a product they’ve never seen. In order to rank in Amazon’s search results across all major search terms and get your product seen, your listing needs to be optimized for relevant keywords related to your product.

This can be achieved by using a keyword research tool to help you identify high volume keywords. Be sure you are utilizing a tool that utilizes only Amazon data. When you search the main keyword that describes your product, the tool should give you the monthly search volume for that exact word as well as other suggested keywords to use and their monthly search volume.

Once you have a list of relevant keywords to your product, you can start writing your listing. Unlike Google, Amazon’s search engine focuses on unique keywords, meaning if a keyword is in the listing once, no extra weight is give if it is used again.

While using a keyword multiple times doesn’t give your listing an extra boost, the placement of keywords does matter in ranking. A keyword placed in the title will carry more weight than a keyword placed in the bullet points or backend. With that in mind, it’s usually best to place the highest volume keywords in the title to capture as many searches as possible.

To keep track of all the keywords while writing, we recommend using a listing builder tool. Many of these tools will remove a word from your “master keyword list” once you have used it in the listing.

If you don’t feel particularly confident in your writing abilities, another option is to hire a professional copywriter to create your listing for you. An experienced writer will be able to work with you to write engaging and informative copy that captures all main keywords and adheres to your brand voice. If you’ve got the money in your budget, this option could take one thing off your plate.

It’s important to remember that an optimized listing can only get you so far. Yes, it will ensure that you are indexed for all relevant terms and provide useful information, but it takes a combination of things to convert sales. Make sure your entire listing is strong from top to bottom. This includes investing in professional photography, ensuring your product is priced competitively, and getting to the top of search results.

 

2. Focus on Increasing Your Review Count

Over 85% of online shoppers say they trust product reviews as much as they trust a personal recommendation. This means that having a high number of reviews plus a high review rating can translate to big sales for your product. However, about 90% of Amazon shoppers never leave feedback, meaning the vast majority of shoppers are never giving their opinion.

Obviously there’s no way to ensure every person that buys your product will leave a review. But there are a few tactics you can use to help encourage past buyers to login and write their thoughts on your product.

Marketing Inserts

Many Amazon sellers find that a small insert in your product packaging can nudge buyers to visit your review page and leave their thoughts. This simple reminder can also contain information on who to contact if for some reason there are any issues with the product at the time of delivery. This allows you the chance to make things right before the buyer torches you in a bad review.

That being said, there is a risk in adding these inserts to your product packaging, since Amazon’s terms are written so loosely. While some sellers see success with marketing inserts, add them at your own risk and know that Amazon could take action.

Email Follow Up

Email follow ups are a great way to communicate with buyers. It’s usually best to send a series of emails that builds up to asking for a review. You can create an email template for each of the follow up steps and use an automated email system to send these out:

  • Delivery Confirmation –  Sent 1 to 5 days after delivery, this email will confirm the delivery of your product. This is also a great time to provide a contact number and let the customer know they can reach out with any issues they might have. You always want customers to contact you first with any problems in order to deter them from leaving bad reviews.
  • Review Request – The third email, sent 5 to 15 days after delivery, should contain a request for a review. Explain to the customer how reviews help your business and that you would really appreciate it if they took the time to leave their opinion. You can even include a link that will take the customer directly to your review page.

It’s best to end your email sequence at 2 emails. Any more than that, and it may appear spammy to customers. While nothing will ensure every single customer leaves a review, an email follow up sequence will help to nudge customers in the right direction

Important Note: When asking customers to leave reviews of your product, be sure to not offer any incentive for a review. This is against Amazon’s terms of service. It’s crucial to not break any of these rules when it comes to asking for reviews, as Amazon has recently been cracking down and suspending accounts for review manipulation. Make sure you read the terms of service thoroughly and that you aren’t in violation of any of them when asking customers to leave feedback. For more info. concerning email follow-ups, check out our video below!

 

3. Run a Promotional Launch or Giveaway

At first thought, this may seem counterproductive in your search for how to increase sales on Amazon. How could giving away your product at a discount help make it a success? But there is a science behind this process that could help boost your ranking and improve your sales in the long run.

What is a Launch?

A product launch is a targeted giveaway meant to project your listing to page one of search results for a major keyword. The overall goal of this process is to increase organic sales, but you’ll have to giveaway your product at a deep discount in order to boost keyword ranking. To rank among your top competitors, you must match or slightly exceed their daily sales for a short period of time. Usually this discount is 90% or more so that you’re able to sell the required number of units per day.

Who Can Help Me with a Launch?

The Amazon Seller Coaches at Viral Launch are here to help you in every step of this process. First we’ll help you identify a keyword to target for your launch. Then using Amazon data for your specific market, we’ll determine the number of units you’ll need to give away in order to achieve page one status.

Typically, launches run for 7 to 10 days. This range is the sweet spot. It allows enough time for Amazon to recognize the sales, while also being short enough that it limits the number of units you’ll have to give away. This will allow you to boost ranking while also saving money.

While a large portion of our data points to 7 to 10 day launches being the most effect for sales history and velocity, Amazon’s algorithms are constantly changing. This means it’s important to keep an eye out for the latest best practices. Some Amazon sellers have recently found success giving away a larger amount of inventory within one day for a larger, sharper sales peak to boost ranking.

What Happens After a Product Launch?

Once your product is ranking, the goal is to get enough organic sales that you can maintain your page one ranking. This places a lot of importance on your listing, photos and price. Be sure your copy is optimized for your main keywords. Upload professional product photos and make sure your product is competitively priced. All these factors will help you convert and maintain your ranking.

4. Utilize PPC Ads

PPC (Pay Per Click) ads allow your listing to get more exposure for a targeted keyword. When you set up a PPC campaign, you set a daily budget and bid on a click price. Amazon will then post your listing as an ad for targeted keywords. You do not pay unless the ad is clicked. However, keep in mind that just because someone clicks, does not mean they will buy, so be sure your listing and photos are optimized to convert sales. There are two types of Sponsored ads in Amazon Seller Central:

  • Manual – This allows you to pick the specific keywords you want to target. If you know which keywords your listing converts best for and you want to target them specifically, this is a great option.
  • Automatic – This option allows you to set a budget and then Amazon’s algorithms will select which keywords to present your product for. These ads can be a bit unfocused or random, but can give great insight into which terms your product converts well for and can still help to get your product seen.

Use the Data

One thing people often overlook about PPC campaigns is that it gives you tons of useful data about your listing, impressions and conversions. This can help you improve your listing and increase sales. For example:

  • High Clicks, Low Sales – If you’re getting a lot of clicks for a keyword, but low sales, you may be able to tweak your copy and optimize the listing in order to take advantage of the customer interest in the specific keyword.
  • High Conversions – If you’re getting a high number of conversions for a specific keyword, you may want to put even more focus on and budget into that keyword, as it’s clearly paying off for you.
  • High Impressions, Low Sales – If it seems that you’re getting a lot of impressions, but no one is buying your product, this may mean that your chosen keyword isn’t relevant to your product. This then causes people to click the ad, but leave the page as soon as they realize it isn’t what they want.

Bonus Tip: External Traffic

While it’s against Amazon’s guidelines to include any links or marketing language in your listing that takes shoppers away from their site, you are allowed to push visitors from other sites to your product on Amazon. You can utilize your company website, blog, etc. to bring people to your Amazon listing.

If you have a website or blog with decent traffic, start including links to your product listing. You’d be surprised of the difference this can make. The goal is to get as many eyes on your product as possible, so the more paths to your listing, the better.

Keep in mind though that for some sellers, driving external traffic isn’t always the best use of effort or money. First focus on using the tips previously mentioned in this post and take advantage of the immense traffic that Amazon already provides.

Get to Work!

Remember there’s no magic bullet for increasing your sales on Amazon. A variety of factors go into ranking, converting and staying competitive in any market. Don’t simply pick one of the tips out of this list and assume it will mysteriously solve all of your problems. Take your time, gather data, do research and create a strong overall listing with optimized text, professional photos and a competitive price. With all these factors working together, you’re sure to find the methods that make your revenue grow!

 

5 Data-Based Listing Optimization Tips | Using Data To Improve Your Amazon Listing

5 Data-Based Listing Optimization Tips | Using Data To Improve Your Amazon Listing

Keyword Matter. YOU matter. How you USE a keyword MATTERS. Placement, frequency, plurals, hyphens – there are so many intricacies to keywords and listing optimizations on Amazon, and it’s INCREDIBLY important to get them all right. Getting it right means you’ve checked that box off your list – that you can now focus on improving and implementing changes across other mediums. Getting it wrong means you’ll be fighting an uphill battle until it DOES get fixed. In this episode, we’re breaking down 5, updated, data-driven, data-based simple tips to improve your listing optimizations. These are insights that you can take, and instantly go and implement. We’ve seen conversions increase from following these. So listen in, take notes, and take action. Let’s get started.

 

Listen on iTunes   Listen on Stitcher

Shipping To Amazon FBA: A 6-Step Guide

The more streamlined, hands-off approach of Fulfillment by Amazon can be very appealing to sellers. Not only will Amazon pick, pack and ship orders for you, they’ll even handle customer service and returns. Your products will also be Amazon Prime eligible, another big advantage due to Prime’s ever-growing popularity. But first things first — how do you even start shipping to Amazon FBA?

Amazon has more than 75 fulfillment centers and counting across the North America, many of which are set up for FBA. Shipping to Amazon FBA is relatively easy, but it does take some work. There are many decisions to be made, and some product categories require extra measures to be taken.

Due to the incredible amounts of inventory they receive, Amazon’s FBA warehouses operate under strict guidelines. All products must be properly shipped, labeled and prepared for the safety of the item as well as for the employees handling them. This also streamlines their intake and shipment processes. Stay in compliance with Amazon’s rules or risk facing penalties and/or extra fees.

And speaking of fees, make sure you’ve carefully reviewed Amazon’s fulfillment and monthly storage fees. Understand all applicable — and even potential— fees so you’re not caught by surprise later on.

Creating a Shipping Plan

Creating a shipping plan is the first step for shipping your items into Amazon. A shipping plan will identify:

  • The products you’re sending to Amazon
  • Quantities of each product
  • Your shipping method and carrier
  • Who will handle product preparation and labeling (you or Amazon)

If you’re shipping in a Private Label product, you’ll need to create a listing for that product before creating a shipping order. Shipping orders are tied directly to a listing – creating that listing, if it doesn’t already exist, will allow you to then create your Shipping Plan. If you haven’t already created a listing, log into Seller Central and head to Inventory > Manage Inventory. From there, you will be able to add products to your account by clicking on Add A Product in the top-right section of the page. After you’ve added your product, and filled out all of the appropriate information for that product, your listing will be complete!

Once this is done, you’re ready to create your Shipping Plan. Go to the Manage Inventory page and select each item you want to ship to Amazon. Select Send/Replenish Inventory from the Actions on Selected drop-down menu. From here, you can create a new shipping plan or add to an existing one.

Next, verify your ship-from address. This is where you’re shipping the products from, so it may be your home, business or supplier. If your products are shipping from a Chinese Manufacturer, for example, you would need to input your manufacturer’s address here.

Confirm the packing type next. Individual products are single products of different qualities and conditions, while case-packed products are identical items in the same condition. Typically arbitrage sellers will create Individual Product shipping plans, while most Private Label sellers will create Case-Packed shipping plans. In each of these cases, an arbitrage seller might have a lot of different items in one box shipping into Amazon (Individual Products) while a Private Label seller might have a lot of the same item to ship into Amazon (Case-Packed).

Click Continue to shipping plan. You can now proceed through the 6 main steps sellers must follow to fulfill a shipping plan. These steps are detailed below along with other important things to note.

Things to Note

  • You can still fulfill select orders yourself, just make sure these items aren’t selected when creating your FBA shipping plan
  • If you previously fulfilled orders on a product, it can be switched to FBA in the future
  • Bulk shipping plans can be created
  • Per Amazon’s fulfillment infrastructure, your shipping plan may be broken up into multiple shipments that require you to send products to different fulfillment centers in order to make them more readily available to customers; to send your shipment to a single fulfillment center and have Amazon split them for you, in your Seller Central account go to Settings > Fulfillment By Amazon > Inbound Settings > Inventory Placement Option > Edit (service fees will apply and exceptions do exist; this will only apply to shipments created after settings are updated)
  • To apply setting updates to a current shipment, delete the shipping plan, make the desired changes and recreate it by selecting the plan under Deleted/canceled and then duplicating it on the Send/Replenish Inventory page

Step 1: Set the Quantity

Setting the quantity is the first step in fulfilling your shipping to Amazon FBA plan. Fill in the quantity of all inventory you have in stock and want to send.

 

 

At this point, you may receive any of the following notifications:

  • Information Required: More information is needed for a product
  • Removal Required: The item must be removed from the shipping plan
  • Action Recommended: Amazon has identified the product as slow moving and recommends it be removed
  • Excess Inventory: You have more than the recommended number of units in stock

The action recommended and excess inventory alerts can be bypassed by indicating you’ve acknowledged the alert. Make sure all removal required products are removed before continuing.

 

 

Things To Note

  • You can duplicate a previous plan and make adjustments to it to save time when you’re sending the same products again in the future
  • Only inventory you’ve previously set to fulfillment by Amazon is searchable under Search my inventory

Step 2: Prepare the Products

As we previously mentioned, Amazon requires products to be prepared to their standards. And even if you choose to have Amazon prepare and label products for you and pay the per-item fee, you’ll still need to safely ship them to a warehouse.

This may require extra packaging materials, so make sure to read about all packaging and prep requirements for sending FBA inventory.

If you didn’t select Amazon to prep your products, you must do it yourself. Follow all FBA prep requirements or face unplanned prep service fees. Many sellers will have their manufacturer or Freight Forwarder prepare their products to save time and money. If you ask either your manufacturer or Freight Forwarder to do so, make sure that they are aware of the FBA prep guidelines and requirements.

See the Prep required tab on the Prepare Products page for prep guidance on products with set preparation requirements. You may be required to use any of the following:

  • Poly bags
  • Bubble wrap
  • Opaque bags
  • Tape

Products will appear under the Prep may be required tab if their prep guidance is unknown. Select the corresponding product category to determine if additional prep is needed. Click Continue when you’re ready to proceed.

Things to Note

  • Amazon FBA will only prep products with UPCs
  • Click Investigate on the Prep Products page to start a review of prep requirements you feel aren’t applicable or essential
  • Use the following checklist from Amazon to stay organized

 

Step 3: Label the Products

Amazon uses a barcode system to put away and track products. Therefore, all FBA items must be properly labeled according to Amazon standards, unless they qualify for stickerless, commingled inventory. Your labeling options for shipping to Amazon FBA include:

  • Using an existing UPC or EAN barcode for eligible products
  • Adding an Amazon barcode directly to the product or packaging
  • Paying a per-item FBA Label Service fee and have Amazon apply barcodes for you

The Labeling required tab shows all products that require labels. If you’ve chosen Amazon under the Who labels column, you must use the FBA Label Service. Applicable fees will appear in the Label cost column. If Merchant is selected under Who labels, you must label the items yourself.

Once this information is set, it’s time to create your barcodes. Click Print labels for this page and make your selections. A PDF will be generated.

Make sure to follow all FBA product barcode requirements. These detail everything from using the right printer and paper stock to the proper label placement. If you are selling products produced by a manufacturer, many Sellers will have their labels printed directly onto either their packaging or their product. This saves the Seller time and money, so we definitely recommend considering this as an option. Manufacturers still need to abide by labeling/printing FBA guidelines.

Things to Note

  • You’re able to change who preps a product by returning to the Prepare Products page

Step 4: Review Your Shipment

Carefully review your shipment. Pay close attention to your shipment ID and the destination fulfillment center code and location as your plan could require multiple shipments to different warehouses.

A shipment name will be given to your shipment, but it can be changed. You’ll also see the number of MSKUs (unique product identifiers) as well as the quantity of each MSKU in the shipment.

Remember, any changes you make here will impact your packing lists. It’s best to print pack lists after approving your shipping plan.

Once you approve shipments, the View Shipments page will appear. Your shipment plan is now set, and your shipment needs to be sent to the designated Amazon fulfillment center or centers. To proceed, click Work on shipment.

Things to Note

  • After a shipment is approved, you can’t delete it and corresponding listings will be changed to Fulfilled by Amazon
  • At this point, you have limited ability to change product quantities
  • Previous FBM listings will become inactive and you won’t be able to fulfill orders for them; once inventory is received, they’ll become active again as FBA

Step 5: Prepare Your Shipment

On the Prepare Shipment page, you can now:

  • Select your shipping method and carrier
  • Determine the number of boxes needed for shipping
  • Schedule and pay for a shipment
  • Print box labels

When shipping to Amazon FBA, it’s important to meet all shipment packing requirements. Minor modifications can still be made to your shipping plan, but there’s a limit. If more changes are needed, it’s better to cancel or recreate the plan or delete the shipment.

 

 

A small parcel delivery (SPD) is for items packed in individual boxes. Less Than Truckload (LTL) refers to cases or boxes that are stacked and/or secured on pallets. And unlike an LTL truck which may have to stop for other deliveries, a Full Truckload (FTL) goes right to the fulfillment center. Many Private Label sellers fall into shipping using LTL, as many do not yet produce enough inventory to fill an entire truckload shipment (FTL). Make sure you are aware of which category you fall into here. Confirming with either your manufacturer or Freight Forwarder will give you insight into this!

 

 

Each shipping method has specific requirements you must adhere to. Please read carefully, as you must input box content information, quantities of each ASIN, box or pallet weight/dimensions, and more.

This page will provide you with an estimated shipping charge which you’ll need to accept to move forward. You can now print shipping labels as well.

Things to Note

  • Amazon-partnered carriers offer discounted rates; a 1 lb. minimum charge will apply
  • SPD deliveries must be cancelled within 24 hours
  • LTL/FTL deliveries must be cancelled within an hour of submitting a shipment request
  • You can’t delete a shipment if you’ve requested Amazon partnered carrier labels or if your shipment has already been shipped
  • Amazon has a comprehensive checklist to help sellers stay organized

 

Step 6: Summary

The Summary page is the last step in Amazon’s shipment creation workflow. It provides an overview of your shipment, tracking tools available for use, and the plan’s receivement status. The page has 3 tabs, which Amazon details below in Seller Central:

Once the product is in a received status, it’ll be live on your listing and available for purchase. Your order fulfillment will now be taken care of by Amazon’s FBA team.

Things to Note

  • You can modify the number of boxes in this step, but you must reprint the entire set of labels

More Shipping to Amazon FBA Resources

How Much Does it Cost to Sell on Amazon? Fees and Costs to Consider

We know figuring out the cost to sell on Amazon can be overwhelming. It may even be what’s been holding you back. This breakdown of common Amazon selling costs will help new sellers get a basic understanding of the main costs you’ll incur and some of the other charges you may face. Because when it comes to managing your money, you never can be too informed.

There are countless reasons why people choose to start selling on Amazon. Some just want to supplement their income, while others are looking to become their own boss and build a full-time business. Part of Amazon’s incredible appeal is that it gives every seller the opportunity to make money in a highly profitable marketplace. Just look at the graph below to see how far Amazon’s yearly sales have come. You can imagine all the possibilities for profit!

While it’s free to list products on the Amazon marketplace, all sellers incur fees. Keeping up with Amazon’s varying seller fees is crucial for the success of your business. The difference in profit and loss can be very slim, especially when you’re just starting out. If you’re not making more than you’re spending on startup, selling fees and other costs, your business will quickly be in trouble.

We encourage you to understand the following Amazon selling plans and seller fees to be a successful, well-informed seller.

The Two Amazon Selling Plans

The first cost to sell on Amazon may come sooner for some. Amazon offers two types of account plans for third-party sellers: Individual and Professional.

Available for a $39.99 monthly subscription fee, the Professional selling plan is designed for those who plan on selling more than 40 items per month.

The Individual plan has no monthly fee and is intended for people planning on selling fewer than 40 items per month. Keep in mind that this isn’t the number of listings, but the number of actual products sold. This free plan requires very little setup, and all fees will be taken out of your final payout once your product sells.

On the other hand, inventory management, bulk uploads and gift wrap options aren’t offered to Individual sellers. Both selling plans allow you to list products in more than 20 different product categories, with another 10 categories available only to Professional sellers who apply for and meet the requirements for them.

Choose the selling plan that’s best for you and your selling aspirations. Established eCommerce sellers with other online storefronts and driven individuals looking to start a venture that pulls in significant income are ideally suited for Professional selling plans. But if you’re just looking to get your feet wet, you can always set up a free Individual account and switch to a Professional account later. 

The Main Amazon Selling Fees

Amazon selling fees will vary based upon the seller program you sign up for, the size and weight of your product, and the time of year. Because the cost to sell on Amazon is dependent upon your unique situation, this is often a source of confusion for new sellers.

That being said, there are 5 main types of fees for third-party sellers who self-fulfill orders that you need to know about:

  • Monthly subscription fee
  • Per-item fees
  • Shipping fees
  • Referral fees
  • Variable closing fees

Individual sellers are held responsible for per-item fees as well as referral fees and any applicable variable closing fees. Pro merchant sellers will incur referral fees and variable closing fees when applicable.

 

 

Monthly Subscription Fees

As we previously mentioned, monthly subscription fees only apply to Professional selling accounts. Warranting any special circumstance, you will first be charged during the registration process.

Per-Item Fees

Similarly, only Individual sellers will be charged a $0.99 per-item item fee for each product sold.

Shipping Fees

All items sold by Individuals will face shipping and handling fees. When you ship an order, you’ll receive a standardized shipping credit from Amazon. Shipping credits for Individual sellers will vary depending on the product category and the shipping method selected by the buyer.

Keep in mind you must ship the order even if the shipping credit received is less than your total shipping cost. You may need to adjust your shipping and/or product price to offset the difference.

Only media products sold by professionals will incur shipping costs and use the same fixed rates. Media products, commonly called BMVD, include the following:

  • Books
  • DVDs
  • Music
  • Software
  • Computer/Video Games
  • Video
  • Video Game Consoles

Understanding shipping and handling fees will help make sure you don’t spend most (or even all of) your profit simply getting the product to the buyer.

Referral Fees

Another main cost to sell on Amazon is a referral fee, which all sellers must pay for each item sold. Some categories are set up with a per-item minimum referral fee, so you’ll either pay the referral fee or the per-item minimum fee, whichever one is greater. Take a look at Amazon’s fee schedule here.

Most categories have a 15% referral fee, but it can go as low as 6% (personal computers) to a high of 45% (Amazon device accessories). Minimum referral fees are either $1 or $2, with jewelry and watch categories having the higher cost.

The referral fee for media products is based upon the item price and doesn’t include shipping and handling. All other referral fees are calculated using the total price charged to the customer with shipping and handling included.

Make sure to research your referral fees as this could impact which category you choose to sell in!

How much money do you really need to sell on Amazon?

Check out this video for a closer inspection with more detailed cost examples. Don’t forget to like, comment or subscribe:

Variable Closing Fees

Both Individual and Pro sellers have to pay a variable closing fee for each media/BMVD item sold. A flat rate of $1.80 will be added on top of your referral fee.

For more information on fees and to see specific examples, check out our other post on Amazon seller fees.  

Main FBA Fees

For third-party sellers who don’t self fulfill orders, the cost to sell on Amazon will also include FBA fees. Being a part of the Fulfillment by Amazon program means all of your orders will be picked, packed and shipped by Amazon instead of by you or your business. They’ll also provide basic customer service for your products.

FBA fees are paid in addition to all account, referral and closing fees that you meet the criteria for.

There are 2 primary types of FBA fees:

  1. Fulfillment Fees: Charged per unit and include picking and packing your orders along with shipping and handling, basic customer service and return processing unless your product is in a category with free returns
  2. Monthly Storage: Priced per cubic foot and is the cost of storing units in Amazon’s fulfillment centers

Order fulfillment fees are based upon the overall size and weight of your product, which is separated into 2 tiers: standard and oversize. This includes all inner and outer packaging materials like shoe boxes, blister packs and other types of retail packaging.

Monthly storage fees will depend on the product size and calendar month. You’ll pay based upon your daily average volume. Note that prices go up significantly around the holidays, October thru December. See the chart below for a full breakdown. You can find specific FBA fee examples here.

 

 

It’s important to take these standard FBA costs into consideration as they may impact your business plan.

There are many benefits of FBA, including Prime eligibility and being eligible for Free Super Saver Shipping on orders over $25. Both will lead to better product placement on Amazon. So while there are extra costs involved with FBA, for many sellers, the increased product visibility and less hands-on inventory management make it worthwhile. Ultimately, this is up to you.

You can, however, use Viral Launch’s free FBA Calculator to estimate your standard FBA fees and help ensure you won’t be operating at a loss. Also make sure to check out the U.S. FBA inventory storage fees and policy changes instituted in 2018.

Other FBA Fees

You may face additional FBA fees on top of the 2 primary fees. Some are optional and others only apply to certain sellers and situations. They include:

  • Inventory Removal: Charged per item removed if you pull inventory or remove unsold stock
  • Return Processing: Charged to products with free customer returns and will be the same amount as fulfillment fees
  • Repackaging: Charged to repackage eligible items following a return in order for resale
  • Labeling Service: Charged per item when you have Amazon apply barcodes to your products for you
  • Long Term Storage: Charged if inventory sits unsold for 6 months to 1 year
  • FBA Prep Service: Charged per unit to items you have Amazon package and prep for fulfillment 
  • Unplanned Prep Service: Charged if a product isn’t packaged or prepared for storage to Amazon’s standards
  • Multi-Channel Fulfillment: Charged when you have Amazon fill orders for any products you sell on other eCommerce websites
  • Inventory Placement: Charged when you send all of your inventory to one fulfillment center and Amazon distributes it to other fulfillment centers for you

These aren’t all of the additional FBA fees you could incur. Be aware there may be extra costs involved. Pay attention to your monthly invoice to see what you’re being charged for! You can typically rectify the situation to avoid being charged in the future.

Other Costs to Consider

While fees will be a considerable part of your total costs, don’t forget there are initial startup and other optional charges to consider, especially for private label sellers, that can help you get ahead of the game.

Product Research

When it comes down to it, your main cost to sell on Amazon depends upon the product you choose as fulfillment and shipping fees will vary from there. You need to make smart product choices, but with so many items out there, how are you supposed to choose? And how do you even know if it’ll be profitable?

Sure, you can search manually, but automated product finders will streamline and simplify the process. The Viral Launch Product Discovery tool can help you quickly find high-potential products that meet your unique wants and needs. After inputting criteria like your desired monthly sales, selling price, review count, and monthly revenue, it provides you with a comprehensive list of products, keywords, brands and categories that match your search parameters.

 

 

Sourcing and Manufacturing

When ordering samples, keep in mind that you’ll likely be paying a much higher price for manufacturing and air shipment. This can usually be negotiated into the cost of the initial order, but it’s an additional expense to be prepared for. Samples typically cost $100-200 with shipping, but this will depend on the size, weight, and type of product.

Once you have your first product figured out, you need to place a larger order. During this phase, you’ll also want to determine packaging options from the supplier and obtain a UPC for the product to get an FNSKU from Amazon. You can purchase a new barcode from GS1 as a GS1 Barcode can typically be linked to an FNSKU.

Listing Optimization

Since shoppers can’t see your product in person like they would at a store, your listing copy and photos need to convey all pertinent information about your product. A great listing gives you a competitive edge and helps persuade a shopper into purchasing.

At its core Amazon is a search engine, and you need to optimize written content to work within this search engine. Relevant, high-volume keywords bring shoppers to your listing. Using a Keyword Research tool helps you find valuable keywords with high search volumes or opportunity, which will increase the ranking of your listing and allow it to be seen by more shoppers.

Putting your listing copy and photos in the hands of experts like those at Viral Launch not only minimizes the work for you, it ensures your listing will be optimized in a way that maximizes your ranking and purchasing potential.  

Marketing and Giveaways

Amazon is a crowded marketplace that’s all-too easy to get lost in. When shoppers visit your category, you want to be the first product they see. Organic sales and keyword ranking are crucial, and marketing and giveaways can help accomplish this.

Giveaways, called Launches at Viral Launch, are targeted giveaways to project your listing to Page 1 for a major keyword, with the goal of increasing your organic sales. We typically recommend running a giveaway for a period of 7-10 days. This period of time is long enough for Amazon to recognize the sales but short enough to limit the number of products being given away.

PPC, short for for Pay Per Click, is another way to drive visibility to your Amazon listing through paying for sponsored ad content. Set a daily budget and bid on a click price. Amazon will post your listing as an ad for targeted keywords. You won’t pay anything unless the ad is clicked on by a shopper.

These optional, though very beneficial, costs can help you in the long run and should be taken into consideration as you develop and grow your Amazon business.

Recap

Multiple factors will determine your cost to sell on Amazon. And while there’s no set magic number for everyone, there is certainly plenty of helpful advice from experienced sellers out there.  

New sellers need to be aware of the following costs:

  • Purchasing and/or manufacturing products
  • Packaging, shipping and handling
  • Selling fees
  • FBA fees
  • Other business fees

Although these may not be applicable to all sellers, it’s important to know they exist and could come into play in the future.

Amazon seller fees hinge upon your account plan, product, product category and type of fulfillment. Barring any special circumstance, sellers are paid every 2 weeks. Make sure your profit margin can cover your expenses—doing so right from the start will boost your ability to become a successful Amazon seller.  

Subscribe to the blog for more advice on how to start your Amazon FBA business!

11 Tips to Source Best Selling Products on Amazon

If you’ve thought about selling products on Amazon, the possibilities of what to sell can seem overwhelming. When you combine the 12 million products Amazon sells itself with all the third party seller products, there’s over 300 million products already being sold. Anyone can create a Seller Central account and start selling items on the ecommerce site, but how do you ensure you find items that will become best selling products on Amazon? It isn’t just luck.

It may seem like some of the top sellers are just taking a shot in the dark and hitting the jackpot when their product blows up in popularity, but this isn’t true. Tons of research and planning goes into launching best selling products on Amazon. You have to know the market, where to source and the best methods to get your product to Amazon’s warehouses.

This isn’t as easy as choosing a random product and crossing your fingers that it will sell well. There is work involved, but we’re here to help. Follow these 11 tips to find and source the next top selling products on Amazon.

1. Use a Product Finder Tool

It’s possible to get ideas for products just by thinking about useful items in your own daily life. But a product finder tool, like Product Discovery from Viral Launch, will also give you helpful Amazon data about real products currently selling on the site.

 

This tool allows you to search by product, keyword, category and brand and is loaded with advanced filters to narrow and personalize results to products that meet your exact selling requirements. If at first all the filters seem somewhat overwhelming, don’t worry. There’s plenty of tutorials to help you get started.

2. Complete Market Research

Finding a successful Amazon product relies heavily on the market research you do beforehand. You can’t simply pick a product and charge in blindly without the proper knowledge. Take the time to do extensive market research before deciding on a final product. This includes learning about competitor products in the market as well as learning about past market performance and future market trends.

Using a tool like Market Intelligence from Viral Launch will allow you to view data on the top selling products in your market. Either search directly in the Market Intelligence tool or use the Chrome extension to gather data while using Amazon. All data about the top products will be pulled and organized in a matter of seconds, so you can quickly see all the information you need.

 

3. Look for Products to Source

Once you have settled on a product idea, it’s time to start thinking about where to source your product. Many private label sellers use Alibaba to source their best selling products on Amazon, as the site allows them to get in touch with numerous manufacturers worldwide.

Alibaba allows you to search for a product and returns a list of manufacturers currently producing similar items. When you find a product you like, you can click the result to see detailed product and manufacturer information and get in touch with the supplier. Alibaba provides 3 quality assurance metrics that you should pay attention to when browsing for a product. Since you will most likely be working with international manufacturers, it’s important to be cautious in every step as it is very hard to get international legal resolutions.

These quality assurance metrics include:

  • Trade AssuranceThis will protect you in the event of shipping or quality related disputes with a supplier. You’re covered if products are not shipped on time or if products do not meet quality standards as agreed upon in the contract with your supplier.
  • Gold Supplier If a supplier on Alibaba is shown as a Gold Supplier, it means they have undergone a verification process that proves they are a registered legal business. While this doesn’t necessarily mean the company is specifically reliable, it tends to provide more legitimacy.
  • Assessed Supplier Assessed suppliers on Alibaba have passed a verification process with independent inspection companies.

Alibaba allows you to automatically filter for products that fulfill these quality assurance metrics. It’s a good idea to filter for each of these metrics as you browse through a wide array of product possibilities.

Also, as you begin looking at items to source, keep track of any that you think have the potential to become top selling products on Amazon and the cost of each unit. You can combine this cost with the referral fee and FBA fee charged by Amazon to get a better idea of whether you can sell this product profitably. Many manufacturers also have a minimum order requirement so be sure to pay attention as that will directly affect your initial investment.

4. Connect with Multiple Manufacturers

After you’ve identified some products you’re interested in, it’s time to start building relationships with manufacturers. It’s important to reach out to more than one manufacturer in order to find the best product in a timely manner. We recommend reaching out to about 10 suppliers who have products that meet your requirements.

Be kind and courteous when contacting any potential business partner and be sure to understand cultural differences when working with international suppliers. Establishing rapport with suppliers can lay the bricks to build a lasting relationship for future product expansions. Also, be sure to present yourself as an established business owner, even if you’re a first-time seller. If you come across as inexperienced, it’s likely that you will not get the best price from manufacturers.

Below is a good example of the first correspondence you can send to manufacturers. This is just to give you an idea of some of the information you should try to gather. If you have any additional questions for the supplier, be sure to include them.

Dear [Manufacturer Name], 

My name is [Your Name] and I am the owner of [Company Name]. We specialize in selling Health and household items through major online retailers and are currently interested in growing our product line. We’re interested in learning more about your compact first aid kit [Include Product Link]. 

Before we make a final decision about which product best fits our needs, could you please provide me with the following additional information about your product: 

 

– Can the products be packaged in custom packaging? 

– What is the average manufacturing time for each order?

– How many of the products are shipped in each case?

– What are the dimensions of each case?

– What are the lead times for a sample and trial order?

 

I appreciate your time and am looking forward to your reply so we can take the next steps in the ordering process. 

Thank you,

[Your Name]

Pro Tip: Checking Your Margin

At this point, you’ll be getting direct quotes back from manufacturers on exactly how much it’s going to cost for you to place an order for a certain number of units. As we said, manufacturers will also require minimum order quantities. You should evaluate, based on the minimum order quantity and the true margin for each product, whether you should still move forward with this product or try your hand at another one.

We’ve seen sellers get into markets, only looking at top line revenue instead of taking into consideration what the margin is actually going to be. You want to know for sure how much it’s going to cost to get into your market.

Find out how much it’s going to cost to produce each unit, then find out how much it will cost to ship your units to your desired destination. This will be your landed unit cost, and will involve the following:

  1. How much it will cost to manufacture each unit
  2. Shipping cost per unit (Total shipping cost / total number of units ordered)

So, for example, let’s say each First Aid Kit costs $2 to manufacture. Let’s also say the shipping (from the manufacturer to an Amazon Warehouse) comes to $600 total, with an order of 1000 Units. Our landed unit cost would be $2.6: ( ($600/1000) + $2)

After taking into consideration the Amazon Fees for selling this product, do the margins make sense for you as a seller? If so, great! Keep on moving forward. If not, no worries – keep on looking for a goldmine product!

We have a Podcast episode that will walk you through great steps to take with manufacturer negotiation and general best practices for sourcing products. Check it out here!

5. Order Samples

As you make first contact with the suppliers, take note of who gets back to you quickly or who is most responsive to any follow up questions you have, as these are good indicators of reliability. This will help you narrow your list of 10 suppliers to a list of 3 to order samples from. Seeing the product in person will help you make the decision of which option is best for your needs.

When ordering samples, you will likely be paying a much higher price for manufacturing and air shipment. Often, you can negotiate this expense into the cost of the first large order, but it will be required upfront before samples can be manufactured. Sample products typically cost between $100 and $200 including shipping, but will vary depending on size, weight and type of product. Most suppliers let you use PayPal for samples, which is a quick, easy and secure form of payment.

6. Compare Samples and Manufacturers

As your samples are delivered, inspect them closely for quality of materials and construction. Make sure that the product meets all of the specifications you required. Since you ordered samples from more than one manufacturer, now is the time to compare them to find out which has the potential to become one of the best selling products on Amazon.

Which product seems the best out of the group? Which supplier was easiest to work and communicate with? How easily can each product be packaged with your unique branding? All of these questions should play a role in your final decision.

7. Continue Watching the Market

During the entire sourcing process, you’ll want to keep an eye on the market to ensure it doesn’t take a sudden dive in sales or become oversaturated with competitors. If you’ve identified this market as one with good potential, there’s always a possibility that others have figured it out too. So you want to be sure other sellers haven’t rushed to this market and oversaturated it with options.

If you’ve continuously watched the market and all still looks good, it’s time to take the leap and order your first shipment of products. You’ll need to work with the supplier to get packaging options finalized, and to make any further adjustments you’d like to see in the course of your product’s final production.

You’ll also need to purchase a UPC for the product from GS1. This UPC can then be linked to an FNSKU with Amazon. While Amazon will sticker your inventory with an FNSKU, there is an added fee. It’s usually more cost effective to have your manufacturer print the code on the product.

8. Ensure Shipment is Inspected

In order to ensure the quality of the product, it’s always a good idea to have each shipment independently inspected. Items do not become top selling products on Amazon if they have defects or are of low quality, so this is an important step. You can either contract an inspector in the country of manufacturing or choose to do this domestically. Alibaba offers a feature to connect you with inspectors who will then document and photograph any defects. This will help correct manufacturing before your product is shipped.

Generally, we recommend getting an inspection done in the country that the product is manufactured in. Getting an inspection done in this way, from a trusted inspection service, allows you to catch any manufacturing mistakes before the products are on their way to Amazon.

9. Plan Ahead

Before ordering stock, you’ll want to plan ahead for how much you need and the cost of each reorder. It’s a good idea to try to plan for at least a 2 month run of inventory. The cost calculator built into Market Intelligence will help you get a basic idea of how much inventory you will need.

You will also want to get an idea of lead times to help you plan for future inventory. For example, if it takes 60 days from the moment you order your products to the time they are in Amazon’s warehouse and ready for purchase, you will need to order inventory well in advance. Otherwise, you will be constantly running out of stock.

Make sure to also plan ahead financially. Keep in mind that you will not immediately be able to pull out your initial investment. If you invest $10,000 for a 2 month supply, but your resupply takes 2 months to arrive at the Amazon warehouse, you will really need $20,000 available initially.

This is because you might need to place your second order right as your first shipment is hitting inventory to ensure you can sell without interruption. Until you start steadily selling, your initial investment will be tied up in inventory reorder.

Amazon is a cash game, and often sellers underestimate just how much it’s going to cost to keep up with demand. It’s going to take time to develop an understanding around your own lead time, however we encourage you to keep track of lead time between each of your products. Finding the perfect balance between cash flow and making sure your products are in stock is difficult, but worth the time and energy to figure out.

10. Familiarize Yourself with Incoterms

International Commercial Terms (Incoterms) are commercial terms published by the International Chamber of Commerce (ICC) in order to facilitate agreements between buyers and suppliers. These terms are negotiated during your agreement with the supplier and will determine the logistics and liability of the manufacturing and shipping process.

The terms for transporting the goods can be negotiated using any of the following rules:

  • EXW (ExWorks) – In this agreement the seller makes the goods available at their premises, but the buyer is responsible for transporting them. This places maximum obligations on the buyer and minimum obligations on the seller, as the buyer incurs the risk of bringing the goods to the final destination.
  • FCA (Free Carrier) – This allows the buyer to choose a carrier to move the product. Once the seller has delivered the goods to the carrier, all responsibility is off them. The buyer takes over the responsibility of unloading the goods and reloading the goods at the carrier facility.
  • FAS (Free Alongside Ship) – The seller’s responsibility is fulfilled when the goods are placed alongside the buyer’s vessel at the named port. The buyer incurs all costs and risks of the product from that moment.
  • FOB (Free on Board) – The seller incurs all costs and risks of the goods until they are safely loaded onto the vessel and must also arrange for export clearance. The buyer is responsible for marine freight transportation, bill of lading fees, insurance, as well as unloading and transportation cost from the arrival port to destination.
  • DDP (Delivery Duty Paid) – The seller incurs all the responsibilities of delivering the goods to the named destination in the buyers country. Seller also pays all costs required to bring the goods to the destination including import duties and taxes. But seller is not responsible for unloading.

Shipping logistics can be extremely costly, especially for a new seller who is just getting started. For this reason, DDP is the most valuable option and is usually suggested as the best option to choose, if available. In this case, you would contact your manufacturer to see if they are able to deliver directly to either your own storage facility or an Amazon Warehouse. Most manufacturers now have the ability to do this, so asking to ship your products directly to Amazon is not abnormal.

Some sellers also choose to ship their items through a Freight Forwarder. If this is the case, typically sellers will either choose to ship using FOB or EXW. In each of these cases, your Freight Forwarder would pick up your products at your manufacturer’s last point of contact. 

11. Weigh Pros and Cons of Shipping Options

When shipping from other countries, you have two options: ship by air or by sea. Prices of both options will vary depending on the size of the order and the type of product.

Shipping by sea is always the least expensive option when compared to air, but is also more time-consuming. And there is a greater chance of product damage when shipping by sea. However, many sellers still choose this method in order to keep costs down. Shipping by air is usually not a profitable option.

We mentioned implementing the use of a freight forwarder before. You should consider whether you would like to have another third party involved or whether you would want to go through shipping logistics without another third party. Freight forwarders typically bring more visibility, simplicity, and trust when it comes to importing. The trade-off, almost always, is an extra expense.

Find Your Next Money Maker

Identifying a profitable idea and turning it into one of the best selling products on Amazon is a multi-step process that requires time and patience. Getting a product idea nailed down is just the beginning as sourcing the product requires the most effort. Take these tips, do your research, and find and source your next big product. For even more tips, take a look at our video series on How to Sell on Amazon. Get started with the first video below!

 

What to Sell on Amazon – 5 Tips to Find a Profitable Amazon Product

There’s a lot of money to be made in the Amazon game, but the problem many face is figuring out what to sell on Amazon. The possibilities can seem overwhelming as almost anything you can imagine is already being sold on this monstrous online marketplace. Nearly any search yields thousands upon thousands of results. So how do you break into the game and figure out the best products to sell to get your share of all that cash?

Many people make extra spending money through retail arbitrage or reselling discounted products at a markup. But the real money on Amazon is in the private label market.  

This isn’t to say that you can’t turn retail arbitrage into a lucrative venture, but there are significant limitations to that type of business. You are responsible for going out and finding all the products you are going to sell. If at any point you stop or take a break from this process, your cash flow also stops. You also must compete with other sellers that have the exact same product as you instead of marketing and selling your own unique brand.

Fulfillment by Amazon or FBA private label selling only requires coordinating with a manufacturer to get products to Amazon’s warehouse. That means you never have to personally handle the product. It also means that you can make money even when you’re not working.

You can sit back and relax as your products are ordered, packaged and shipped by Amazon. FBA private label allows you to build an entire line of products and create a complete, scalable business, all while never having to handle the inventory yourself.

If you’ve decided you’re ready to take the plunge and try this out for real, we’ve got some tips to help you find what to sell on Amazon.This isn’t a venture to be taken lightly as hard work lies ahead. But with the right tools and work ethic, you can identify great products and begin building your empire. For even more tips, take a look at our video series on How to Sell on Amazon. Get started with the first video below, and follow these 5 tips to get going with your Amazon Journey!


 

1. Get Creative!

First, you need some basic product ideas. Think about your daily life. What items do you use most often? Is there a product you currently use that could be improved? If you can find a product you’re passionate about to sell on Amazon, you’ll find the work involved less tiresome. Thinking about things you like or enjoy will also help to get your creative juices flowing. Try to think of products that meet these guidelines:

  • A sale price between $15 and $50 – The lower the sale price of your product, the lower the investment costs, so if you are on a budget, you will probably want to go with a product that sells for under $35.
  • Lightweight and easy to ship – Items that are heavy, large or oddly shaped can skyrocket your shipping and storage costs. Try to find items that can fit in a small box and weigh under 3 pounds including the shipping materials.
  • Items that won’t break during shipping – Especially if you’re a newer seller, you don’t want to take the risk of selling a product that could break on its way to customers. This can lead to bad reviews that bring down your business quickly. Additionally, breakable items require more complicated packaging and thus higher shipping costs.
  • Non-seasonal items – While it may be tempting to get in on a seasonal item or hot trend, this isn’t a good idea if you’re looking for a sustainable product in the long-run. You may make some quick cash, but as the weather or trend changes, sales will drop off, leading to cash flow problems or unsold stock that you can’t move. Focus your ideas on evergreen items that will sell year round.

This outlined criteria is a great starting point if you’re just getting started on Amazon. Products that do not fit this criteria can certainly be home-runs, especially for someone with a little bit more Amazon experience or with a bigger budget.

2. Use Amazon

One of the best places to get ideas for what to sell on Amazon is on Amazon itself. The Amazon Best Sellers List can give you tons of ideas about what is currently selling well on the site. Keep in mind that some of the products featured here may be selling well due to seasonal trends, but it’s still a great place to go for inspiration. The page is updated hourly and broken down by category, so you can see best selling items for every single selling category on Amazon.

 

The tabs across the top allow you to see more narrowed results, with tracking for certain types of best sellers. The New Releases tab tracks new listings with an upswing in sales, while the Movers and Shakers tab tracks items that are quickly moving up in Best Seller Rank (BSR). The Most Wished For tab is a great place to get an idea of what customers currently want. While it doesn’t signify sales, it does point to those items that Amazon users are adding to their wish lists most often.

3. Utilize Product Idea Tools

If you like making data-driven decisions and want to quickly determine which products are most likely to succeed, subscribing to a product finder tool may be the best route for you. Tools like Product Discovery from Viral Launch will organize mountains of Amazon data into one convenient place so you can quickly search for new ideas by product, keyword, brand or category.

This tool allows you to select as many Amazon selling categories as you’d like, input price range, average monthly sales, average review count and much more. It’s loaded with advanced filters that allow you to narrow results to personalize your product ideas and quickly identify the highest opportunity products.

 

Once you input all your requirements and click the “Show Products” button, Product Discovery scours the depths of Amazon to find current products that fit within your search requirements and organizes them into a list of results.

 

 

Now you can easily browse the best product ideas on Amazon and see all relevant Amazon data for each product. You can start forming a list of products that pique your interest with the Pinned Products feature. With an annual subscription, each result is also given a product idea score between one and five stars, with five being the best score. This gives you a quick identifier to easily find the best opportunity markets.

Though all the filters and results can seem daunting at first, there are plenty of tutorials to explain the best way to utilize all the features in Product Discovery. Start experimenting, and you’ll quickly be on the path to sourcing your next big money maker.

PRO TIP: 

Make sure you’re looking at the right product market when you research. While a market like “wireless charging speaker” may seem like a great opportunity with high sales numbers and low competition, there are actually only about 75 people searching for that phrase each month.. So the top selling products are likely getting their sales through a keyword like bluetooth speaker with much higher search volume. Make sure you’re looking at the main keyword (and so the main market) for your product when you do your market research. You can verify a market by looking at search volume using a keyword research tool. And you’ll want to use one that utilizes only Amazon data. Sales volume alone may indicate that a product is popular. However, you want to know exactly what kind of product people are searching for so that you can meet the need.

4. Analyze the Market

Once you have some good product ideas, it’s time to get down to the research. It’s important not to overlook this step. Just because you’ve identified some product markets that seem to have high sales and search volume doesn’t mean they will be gold mines. The market may be oversaturated with competitors. It may be a trendy product on its way downhill. Or, there may be too many high volume sellers for a newbie to compete.

There’s a variety of different reasons why high sales volume doesn’t necessarily translate to a good product idea. But if you do the appropriate market research, you can be sure to find the right product to meet your revenue goals and grow your online business.

Here are some things you want to look for in a product market:

  • No big brand name competitors – It’s hard enough to compete with all the products being sold, but it’s even harder if your product is competing against one with major brand recognition. Stay out of markets that are dominated by common household names.
  • Look for markets where competitors have a low number of reviews – Reviews play a major role in ranking and sales on Amazon. If all the competitor products on page one of search results have numerous reviews, it’s going to be tough to break into that market as a newbie with no reviews. And it can take months… even years to build up review count. Look at the page one results for your product idea. If the average sales to review ratio for all of the competitors on the first page is less than 2, it’s probably not as great an idea as you originally thought. This means that the number of sales is only double the amount of reviews (or less). For example, your top competitors may be selling 1,000 units per month, but they each have 500 reviews. The sales to review ratio here is 2, and it’s tough to compete because of such a high barrier to entry. Try to find a product where the sales to review ratio is 3 or above, meaning sales are three times the number of average reviews, or more. This gives you opportunity to come in with a solid review strategy and overcome the competition.
  • Understand the market trends – In order to get a clear picture of how your product will perform on Amazon, you have to understand the market trend. How has this market performed in the past and how will it continue to perform in the future? Have the sales in this market been steadily dropping over several months? If so, this probably indicates that the market will continue to drop and is therefore not a good place to launch a new product. If however the market is trending upwards, this could be a great time to get into this market. Continue to watch the market during the entire researching and sourcing process to ensure the market is continuing to grow without adding numerous competitors.

Although it isn’t very efficient, it’s possible to complete market research on your own. Simply utilize all the information Amazon gives you. To do this, search your product idea on Amazon. Let’s go with the market “first aid kit” again. When you search this item, you get a page full of results that meet your search query.

When you click on the first result after the sponsored ads, you see the product’s listing. Scroll down to the Product Details section, and here you will find useful information about this specific product:

  • Reviews – This particular first aid kit has 385 reviews. That is relatively high and would be tough to compete with, but remember this is just one product on a page of many results. It’s important to take the entire market into account.
  • BSR – This product is number 2,608 in its broad category of Sports and Outdoors. BSR is an indicator of past sales, and the lower the number, the more it’s selling. Amazon does not release actual sales data, so BSR is an indicator of which products are performing best, relative to others in its category.

When you complete this research for multiple products, you get a clearer picture on whether this is a market that you can compete in. From looking at page one results for “first aid kit” we see that it has a decent potential for sales. Shoppers are obviously buying products like these. There are also multiple results (eight to be exact) on page one with low reviews (under 50, in this case). This means you should still be able to compete as a newcomer.

Let’s Make Things Easier…

Now that you understand how to find all the useful product information on Amazon itself, it’s time to let you in on a little secret. All this market research can be completed quickly and easily with the help of a market research tool like Market Intelligence from Viral Launch. This tool pulls all Amazon data for the top competitors of any market, all within a few seconds.

Continuing with the first aid kit idea, we can search the term in Market Intelligence or use the Chrome extension directly within Amazon, and all the data for the product listings that are ranking for this term will be organized into one place. Here you can see sales estimates, BSR, review data, Amazon fees, monthly revenue and more for all the top competitors of your product idea. You won’t have to painstakingly look at each page one product and gather the data yourself. This tool does all of that for you.

 

The rows highlighted in red are considered outliers. This is because they have monthly revenue or reviews that are much different than the rest of the products. Market Intelligence flags these results because they don’t represent the average product result. Therefore, they not be used as an expectation of how your similar product might perform. It’s crucial to use averages for your predictions instead of trying to replicate the success of the very top player. If you scroll to the right, you can see even more statistics and data about each product.

The tool also gives you an overall product idea score, allows you to view market trends, see a detailed product analysis and calculate your costs. All of these aspects will help data-loving entrepreneurs to quickly and confidently identify what to sell on Amazon.

5. Read Competitor Reviews

So you’ve done your research and identified a great product idea. Now you need to source a product that is as good as or better than the competition. Price is extremely important on Amazon as many shoppers are focused on finding the best deal. Selling a similar product at a competitive price and marketing it correctly can make you lots of money. However, if you can identify small modifications to make your product stand out, you might make even more.

Read competitor reviews and identify small pain points or complaints that customers have about the item. Look for phrases like, “this product is great, except…” or “I really wish this product had…”.

Find trends amongst these complaints. Do several reviews for different products mention the same problem or wish? Focus on small modifications that will be easy and inexpensive to make. This is where you can set yourself apart without increasing your initial investment cost or the purchase price for customers. If several reviews complain that the product is too flimsy, you easily source a product made of stronger materials

Take These Tips and Build Your Brand

Selling on Amazon can be a very lucrative business that, if done correctly, can turn into a full time career. Finding what to sell on Amazon is a huge part of whether this venture is just a one time experiment or becomes a complete business. Discovering a profitable product will take time but can lead to a growing business and expansion into multiple products. Be patient, do the research and success will follow!

Find a profitable product to sell TODAY with a free trial of Product Discovery!

START YOUR FREE TRIAL

 

Amazon FBA: Guidelines for Starting Your Amazon FBA Business

Ready to ditch the corporate life and sell Amazon FBA (Fulfillment by Amazon)? Not sure how to get started?

Or maybe you’re already selling Amazon FBM (Fulfillment by Merchant) and looking to make the switch …

If you’re interested in FBA vs. FBM each program has its pros and cons. But ultimately, FBA provides an unmatched, hands-off selling experience with the ability to scale. For these reasons, many sellers prefer FBA to FBM.

FBA is a method of fulfilling products by having Amazon store, pick, pack and ship your inventory. Through FBA, Amazon even handles returns. Although there are additional fees, setup, and tax obligations, FBA makes it easy to quickly start and scale your business.  lot of the content in this blog can also be found from our How To Sell series! Check out the video if you’d like to get started on your Seller Journey:

Why Would I Want to Sell Through Amazon’s FBA Program?

  1. You don’t have to store boxes of inventory at your house. One major benefit to selling FBA is that Amazon handles a good portion of the selling process, namely the most time-consuming portions. Although you still have to set up an Amazon Seller account (we’ll talk more about how to do this later), choose a product to sell, list the product, and have the inventory sent to an Amazon Fulfillment Center, Amazon takes care of the rest of the process with FBA. So when a customer orders your product, Amazon handles the fulfillment logistics of picking, packing, and shipping. In their words, “You sell it, we ship it.”
  2. Once your products are ready to sell and in stock at Amazon’s warehouses, they are automatically eligible for Prime 2-day shipping. Although it is possible to be a Prime seller through FBM, you must meet extensive criteria to be eligible. And with an estimated 112 million Amazon Prime members, or about 62% of U.S. households subscribed to Prime in 2019, you can’t afford NOT to have Prime shipping. Numbers like that are hard to ignore when it comes to the sales potential that Prime provides.

What are the Different Methods of Selling on Amazon FBA?

Now that we’ve established which program you should sell through (FBA), let’s talk about methods of selling, or where to get inventory. There are many options, all of which appeal to different kinds of people. Some are more hands-on, while others allow for higher earning potential. Three of the most common methods include Retail Arbitrage, Wholesale, and Private Label.

  • Retail Arbitrage – This is a process of finding discounted products in retail stores (such as Walmart, Target or Kohls) and reselling them on Amazon. To make it profitable, the items need to be bought at a significant discount and sold at a higher price on Amazon. You can sell other branded products using this method and it is often a lower risk option, since you can check before purchasing the items if you will be able to make a profit or not. You can also search liquidation stores or online sites for pallets of returned items that can be resold.
  • Wholesale – To sell wholesale, a more unique method, you must find a manufacturer (local or abroad) and convince them to allow you to sell on their behalf. The smartest way to do this is to create an official business or LLC, acquire a wholesale license, then reach out to manufacturers/wholesalers to discuss a contract for selling their items. Getting the business to agree to providing you exclusive selling rights can lower your competition as well.
  • Private Label – Private Label selling involves working with a manufacturer to produce items and add your own brand name and logo to the products. As long as there is no patent on the product model, you can legally sell under this method and even work with manufacturers to create product modifications or additions to make your brand’s product stand out. Many private label sellers use Alibaba.com to connect with manufacturers, get samples, purchase inventory and more.

How Do I Get Started with FBA?

There are two account options when selling on Amazon: Individual and Professional. With Individual Selling Plans, you pay $0.99 per item every time a product is purchased. For those sellers making fewer than 40 sales per month, this may be more cost effective than paying the $39.99 Professional Plan subscription fee. These fees are on top of other FBA fees, which we’ll get into more later.

If you haven’t already created a Seller account, you will need to set one up. If you already have an account as an FBM seller, you can easily switch over to FBA inside your Seller Central account.

For retail arbitrage sellers selling FBA, you will need to add the product to your inventory in Seller Central and follow the steps to create labels for your items, which can be printed at home. Once you have printed labels, you can package different items in one large box to be shipped to an Amazon fulfillment center and print a shipping label for that box as well.

Keep in mind that you will need to pay for these shipping costs out of pocket, plus any materials needed for shipping (labels, boxes, tape, scale, etc.). Additionally, Amazon may require you to send inventory to multiple fulfillment centers depending on their inventory levels, which could increase your shipping costs.

Amazon does not require sellers to sticker products at the SKU level as long as you have a manufacturer barcode for the product. But other sellers with the same product (that are also “stickerless”) could get mixed in with your inventory in an Amazon warehouse and could be picked up and shipped to a customer instead of your stock. If their product is used, lower quality or even counterfeit, you could receive poor reviews, a higher return rate or even be suspended by Amazon for counterfeit sales (even if the product is not actually your inventory).

If you choose to sell Private Label or Wholesale, you’ll want to find a good product to source as well as a trustworthy manufacturer. Check out our podcast about finding a good manufacturer to make sure you make a smart partnership as well as our podcast about sourcing the right product to make a sourcing decision that meets your goals.

You can choose to label items yourself (following the method mentioned for Retail Arbitrage) as long as each unit has a scannable barcode or you can pay to have Amazon prep and label each item for an additional per-item fee. Fees can be as low as $.70 per item to as much as $2.20 per item.

When your shipment is ready to be sent to Amazon, make sure you have an organized shipping plan that includes easy tracking so you can ensure your inventory makes it to the desired fulfillment center. To learn more about carriers who partner with Amazon to deliver shipment to their warehouses, visit their page featuring Partner Carrier options.

Once Amazon has your inventory and your listing(s) is live, Amazon will handle the delivery of purchased items to customers as well as customer service throughout the process. Sellers just need to ensure their item is always in stock and ready for customers to buy. Check out our blog on inventory best practices to make sure you never get behind or run out of stock.  

What are the Fees for Selling through Amazon FBA?

Because your inventory is stored, packed and shipped by Amazon when you sell FBA, there are additional fees associated versus FBM. Earlier in 2018, Amazon restructured their FBA fees into two fee structures:

  • Fulfillment Fees
  • Inventory Fees

Fulfillment Fees are per unit, based on the size and weight of each item and include the complete picking, packing, shipping and handling, customer service and return process for each item.

Monthly Inventory Fees are assessed per cubic foot based on the total size of your items. Inventory fees increase for Q4, so it’s important to calculate your costs for each quarter. Below is a breakdown of Amazon’s FBA fees. Make sure to double check your math with an FBA Calculator for help determining your costs before you source.

Other potential fees sellers could incur include long-term storage fees (if items in your inventory have sat in a fulfillment center for 6 months or more) and additional storage fees if you choose to participate in Amazon’s Multi-Channel Fulfillment Program (more on this later).

Things to Keep in Mind as You Start Your Amazon FBA Business

  • Tax Obligations

Although there was once a time when online sellers could get away with not paying sales tax, those days have come and gone. In June of 2018, the United States Supreme Court ruled in favor of South Dakota in South Dakota vs. Wayfair, Inc. Now, one-by-one, states are starting to enact economic nexus legislation.

Because the decision is new at the time of writing this post, it will take some time for the effects to play out. We encourage sellers to keep an eye on internet sales tax by state, and stay informed on the latest news in Amazon sales tax. Sellers should connect with a tax consultant versed in online sales tax regulations to avoid slip ups or potential mishaps in their FBA businesses.

  • Multi-Channel Fulfillment

Did you know that you can fulfill orders from sales channels outside of Amazon.com through the Amazon FBA Multi-Channel Fulfillment Program? Rather than having multiple different inventory locations and shipping methods for your different online sales sites, store all of your inventory in Amazon’s warehouses and let them pick, pack, ship and handle your items to customers, whether the sale is through Amazon.com or elsewhere. There are additional fees associated with the fulfillment process for multi-channel orders, but you can skip the headache of storing, packing and shipping your items and let Amazon do the heavy lifting.

  • Buy Box

If you are selling retail arbitrage or wholesale, the Buy Box is going to be very important to you. The Buy Box is the box on the right hand side of a listing page with the price, seller and shipping information as well as the “add to cart” button. If there are multiple sellers on a listing, they will be listed below the seller who has “won” the Buy Box. Since the majority of buyers purchase from the seller who has “won” the Buy Box, winning is critical to increasing sales. Although there are several factors considered to “win” the Buy Box, fulfillment method is a crucial component. And FBA sellers are significantly more likely to secure the Buy Box over other sellers.  

  • Reviews

If Amazon is handling the customer service for your product under FBA, you shouldn’t have to worry about reviews right? Wrong! Reviews are a huge driver of sales, so whether you’re selling wholesale, retail arbitrage or private label, bad reviews and a low star rating can tank your sales rate. And, with the ability to filter by star rating, too many bad reviews could effectively leave you out of a user’s search results.

For private label sellers, positive product reviews are key to buyer trust in your product quality. If your product is similar to several others in the market, a better star rating could guarantee your product is chosen over your competitor’s. For wholesale and retail arbitrage, positive seller reviews are extremely important to establishing trust in your brand’s quality. Buyers want to hear from their peers if they can trust purchases coming from your seller account or if they should be concerned with used or damaged goods.

There’s been a lot of talk around reviews and Amazon cracking down on review fraud, so making sure you don’t violate Amazon’s Terms of Service for reviews is vital to avoiding suspension. Check out our video about Amazon’s recent “review crackdown”:

Final Thoughts: Learn from Failure

Look, it’s no secret – Amazon FBA can be a confusing and difficult platform to navigate. You’re bound to make some mistakes. What’s important is that you learn from your mistakes and minimize missteps in the future. Following our Amazon FBA guidelines is a good start, but to be truly successful, sellers should keep seeking out new information and staying up to date on changes.

There’s an old quote that states: “Complacency is the enemy of progress.”

Getting complacent or lazy at any stage of your FBA business journey is a recipe for disaster as it requires constant maintenance and upkeep to stay on top. By working hard and arming yourself with up-to-date information, you’ll have the tools you need to achieve Amazon FBA success.

How To Sell on Amazon for Beginners: 6 Steps for Starting Your FBA Journey

In this guide, we’ll walk you through how to sell on Amazon and give you six tips for success.

Wouldn’t it be nice to generate a little extra income? Selling online has afforded many hardworking and driven people more financial freedom and in some cases, completely changed their lives.

In a recent study, it was estimated that 40 percent of worldwide internet users bought products or goods online several times a month. And that number continues to grow daily.

This has led many people to ask themselves: How can I capitalize on this e-commerce explosion?

One of the largest players in the space is e-commerce giant Amazon — a multi-billion-dollar company that has established themselves as the leading online retailer. But Amazon is more than just a store. It’s also a marketplace where regular people – just like you and me – can become successful internet entrepreneurs and make passive income.

What is Amazon FBA?

One of the most popular options for selling on Amazon is as a third-party seller through their Fulfillment by Amazon program, or FBA.

Whether you’re a college student, a retiree, or somewhere in between, you can become an internet entrepreneur through Amazon FBA. In fact, more than half of the total sales on Amazon come from third-party sellers.

Amazon FBA is a popular option because many of the logistics of operating a physical business are handled by Amazon. This allows sellers to minimize their effort and maximize their time and (most importantly) profits.

Benefits of Amazon FBA for Beginners

For the sake of this guide, we’re discussing how to sell on Amazon for beginners through the Fulfillment by Amazon program. There are other options (such as FBM) … but those are blogs for another time.

Like we covered briefly in the beginning of this blog, FBA means you send your products to Amazon and they store, pack, and ship your product to your customers. While there are, of course, additional fees with this strategy, there are also some serious benefits:

  • Prime perks: All FBA products are eligible for Prime, which is a huge advantage for FBA sellers. An astounding 63 percent of Amazon shoppers are Prime members! In fact in 2018, it’s estimated that Prime shoppers will drive more than $117 billion in spending. Selling through FBA means your products will be eligible for Prime free two-day shipping.
  • More trust: Amazon has done a great job instilling trust in their business model and practices, which helps you as an FBA seller. When people see a product is Fulfilled by Amazon, they know it will arrive in good condition and on time (and if not, Amazon takes care of it).
  • Hands-off: Scale your side-hustle into a full-time income. FBA gives you the ability to quickly scale without the difficult logistics of handling inventory and shipping out orders.

All these benefits, plus more, contribute to why FBA is a popular strategy for selling on Amazon that leads to incredible sales potential! Just keep in mind, as an FBA seller, you will have to get your products properly prepared for Amazon’s warehouse. That means printing barcodes on products, packaging items per Amazon’s requirements and shipping them into their warehouses.  

So now you’re ready to begin your FBA journey. But where do you start? Here are 6 steps for starting your online business and making your first sale.

  1. Find Product Ideas

Now that you know a little bit about Amazon’s FBA program, it’s time to sign up as an Amazon seller. You can choose an Individual or a Professional Selling Plan. If you’re hoping to sell more than 40 products per month, you’ll want a Professional Selling Plan. 

The next step is finding product ideas, and this is a really important step. One of the most popular ways to sell on Amazon is through Private Label. Private Label is when you choose a product, find a manufacturer, and then package and sell those products under your own brand.

Choosing the right product to private label and sell on Amazon is crucial for your success, and the process can be difficult and sometimes stressful. There are a whole host of factors to consider, like marketplace viability, popularity, price and profit margins. If you source a random product, you are essentially gambling on its success.

You want to ensure the highest probability of success by understanding the market’s potential. For this reason, getting as much information as you can during your Amazon product research phase is essential.

So, you might be asking: “Where do I start?” Your first move should be to use product finding software that can help you determine the right market to enter.  

This type of software will provide you with a personalized list of potential product ideas that align with your goals, so that you can quickly and easily understand which products will make you money and which ones will take your money.  

Our favorite product finder is Product Discovery, which allows you to find individual products that meet your criteria, find keyword markets full of potential, discover successful brands to emulate, or search subcategories to find that next up and coming product. There are even advanced filters for the adventurous. This allows you to customize your research process and feel confident that you’re seeing personalized results. But if you’re new to this, don’t feel overwhelmed. Pick a few filters that make sense to you, such as Category, Price, Sales, and Reviews, and filter through results to see what catches your eye.

Once you’ve performed your search, you’ll be presented with loads of useful data to help you find potential product ideas. Take a glance below at this example search.

By using a product finder, you’re given all the data and insights you need to find a list of potential products ideas and start your Amazon journey off right.

Want to learn more about Product Discovery? Check out this quick intro tutorial:

 

  1. Validate Your Product

As you might have realized by now, research plays a huge role in whether or not your journey is headed towards success. After gathering a list of potential product ideas, it’s time to dig deeper and validate your product.

One of the best ways to research each of your potential products and ensure yourself the highest probability of success is by using a market research tool. These types of tools help you to eliminate guesswork so you can avoid products that will lose you money.

Market Intelligence, a seller favorite, lets you verify demand for your product by looking at estimated sales numbers, keyword search volume, trends, and market conditions. You can also take a look at how top competitors have performed in the past and are performing now, as well as allowing you to look at potential barriers to entry like reviews, big brands, and high initial investment.

With all this information at hand, you should be able to identify a market full of products that, on average, have healthy revenue numbers and low reviews so it’s easy for you to enter in and compete. It’s also a good idea to look for markets that seem to be relatively stable, rather than chasing trends. While trend categories can be hugely profitable for those that get in quickly, the safer play is to look for markets with long term stability.

For evidence of the risk of trends, look no further than the fidget spinner. As you can see, there was a huge surge in sales, more sellers hopped on, price wars started, and when the trend dried up, many were left with inventory that was impossible to get rid of.

During this research stage you’ll also want to begin thinking about developing a business plan, setting actionable goals and determining how much time, energy, and investment you really want to put into this business.

Keep in mind, during these early stages, you may need more capital than you anticipate. You’ll need to pay for your product, shipping, listing, marketing, and eventually scaling. To get an idea for how much money you could make (and how much you may spend), use an Amazon FBA calculator.

 

  1. Find a Manufacturer and Place Your Order

This next step is another big one. Once you’ve sifted through products and validated your market, it’s time to actually get your product produced and ordered. After in-depth research, we recommend developing a list of at least 3-5 products with margins that align with your goals.

Next, you’ll want to look into manufacturing channels. One of the most popular sourcing options for Private Label sellers is Alibaba.

Alibaba connects you with overseas manufacturers, allowing you to buy your selected products in bulk. Again, doing your research is imperative for picking a legitimate manufacturer to work with.

Alibaba has 3 quality assurance methods that can help you choose what manufacturers to work with:

  • Trade Assurance: This is a free service that helps to create trust between buyers and suppliers. This will protect your money in the case of a dispute with the supplier over issues like product quality or shipment.  
  • Gold Supplier: This allows you to determine which suppliers have received a verification through Alibaba that proves they are a registered legal business. However, this doesn’t mean every supplier with this verification will be 100% reliable, but it does help to lend more legitimacy.
  • Assessed Supplier: Suppliers with this status means they have passed a verification process with an independent inspection status.

Especially for new sellers, we recommend contacting suppliers who satisfy each of those quality assurance checks.

Once you’ve identified a group of suppliers you’re interested in working with, it’s time to make contact and start inquiring about product samples. When working with manufacturers, you’ll want to take note of their response times, clarity, communication, price, timeframe and reputation.

One of the biggest tips we can give you is to think about cultural differences when starting a dialogue with these suppliers. For instance, if you’re working with manufacturers in China, they place a huge emphasis on building relationships. So with that in mind, you’ll want to let them know you’re interested in building a long-lasting business relationship. You’ll also want to make sure to develop a personal relationship and be extremely courteous.

When talking with a manufacturer as a first-time seller, present yourself as a knowledgable business owner looking to quickly ramp up your production and sales. If you portray yourself as inexperienced, you might not get the best possible price from a manufacturer.

A good starting point for a first time seller would be to reach out to 10 or more suppliers, get samples from 3 and then buy a few of your top competitors’ products from Amazon to compare your sample and their product.

To save yourself time, you can create an email template for first contacts that hit on all your major questions. Some things you’ll want to ask are:

  1. Time it takes to receive initial product samples
  2. Time it takes to manufacture the product
  3. What payment methods they accept (like PayPal) for full orders
  4. Cost of shipping the product per unit to your location
  5. Type of packaging that is used

Once you’ve collected and reviewed the samples, it’s time to choose the supplier to move forward with and place your first full order. During this phase you’ll want to determine package options from the supplier and obtain a Universal Product Code through a GS1 Company Prefix.

The next big step is figuring out how much to order. We usually recommend a first-time seller orders enough product for at least a 2-month run of inventory. To get a rough estimate of how much inventory you need, you can use an Amazon sales estimator showing historical trends. 

In terms of shipping inventory from overseas, many newer Amazon sellers will use a freight forwarder. Flexport is a popular option among sellers as they handle all shipping logistics for you for one price, including pick up logistics, sea freight, customs, and more. Using a freight forwarder may be a bit pricier, but many sellers consider the cost worth it for peace of mind in the unfamiliar territory of shipping by sea and importing into the United States.

 

  1. Create an Optimized Listing

Ok … so you’ve got your first product. Now it’s time to list your product on Amazon and make your first sale. As an example, let’s say you’ve decided to sell a first aid kit. Do you snap a picture with your smartphone, throw up a title that says, “First aid kit” and magically start selling? Not exactly.

The goal of an effective product listing is two-fold. You want to accurately depict your product while simultaneously incorporating important keywords to increase the number of people that see and purchase your product.

Think of it this way. You could write a beautiful, eloquent and accurate title, bullets and description of your first aid kit that truly explains why someone should buy it. But, if you don’t include the keywords people are using when searching for that product, you’re not going to be found. So all that great copy would be wasted.

Conversely, you could do in-depth keyword research and find 50 great keywords, throw them haphazardly into a listing and create a nonsensical mess. While you might pull in searches, chances are if someone can’t understand what your product is or does, or it isn’t accurately described, no one is going to actually buy it.

That means you need to find the happy medium of correctly incorporating keywords and accurately describing your product.

Luckily, there are tools available to help you find the exact keywords you should be including in your listing. You want to ensure that your keyword tool is using accurate Amazon-only data.

One of the most important metrics when deciding what keywords to use is search volume, or how many people are actually looking for that product every month. It’s clearly important to find high volume keywords, but there a few other things to keep in mind. You also want to target high-opportunity keywords that competitors aren’t using. And, you want to make sure that the keywords you choose are relevant to your product. If you end up ranking for a keyword that isn’t relevant, you won’t get sales.

Clearly, there is a lot of data here to keep track of. How do you make sure you’ve included all the keywords in the most vital areas your listing? One of our favorite tools that simplifies the listing creation process is called Listing Builder. This feature is included in Viral Launch’s Keyword Research, a tool that allows you to easily gather a comprehensive list of keywords and write your copy on the fly. This feature helps you keep track of what keywords you’ve used and what you still need to incorporate. Once you’re finished writing, you can then take your copy right into your listing for maximum indexation and conversions.  

If you’re not comfortable choosing where to put which keywords and writing sales-inducing copy, we recommend paying for a listing optimization serviceListing optimization services connect you with a team of professionally-trained Amazon copywriters who will write optimized content created for maximum visibility and conversions.

Now that you’ve got the written side of an effective listing down, it’s time to talk about photos. Product photos are an extremely important element of your Amazon listing. Browsing on Amazon, you’ll see some product photos that are of questionable quality at best. You want to refrain from using stock images, relying heavily on photoshop and using largely text-based images. And while you might think your iPhone photo of your product will suffice, you’ll be surprised what a professional Amazon photographer can do for your brand perception, clicks, and sales.

Garnering reviews are also another massively important piece of an effective listing. Recently, there’s been a lot of turmoil surrounding the topic of Amazon reviews. This is just one example of why it’s always important to stay up-to-date on changes to Amazon’s practices.

In short, think of reviews on Amazon as a sort of currency. It shouldn’t come as much of a surprise that, in general, products with better reviews are set up for better sales. However, getting reviews can be difficult, and you want to make sure you follow Amazon’s guidelines or you could face penalties.

One of the best (and Amazon-friendly) ways to generate reviews is through an email follow up campaign, which is used to ask for feedback and encourage reviews on customer purchases. Check out this video full of tips to generate more reviews:

Just remember, Amazon has taken a hard stance against review manipulation, so at this point, it’s better to take a conservative approach to gathering reviews to avoid the risk of suspension or being banned from selling completely.

 

  1. Increase Visibility

So your product is in Amazon’s warehouses ready to ship, and you’ve got an optimized listing for a great product. Have you done all that you can do to drive traffic and increase sales? Not even close! You still have plenty of options for driving traffic to your listing.

One of the most popular – and effective – ways is through what’s called a PPC or Pay-Per-Click campaign. In short, PPC marketing is essentially “sponsored content” that you’ve likely seen when browsing Google, Amazon or any other search engine. What you do is pay a small amount of money to the search engine you want to advertise on for each click that your product gets. PPC can be a great way to get initial traction and place your product in front of even more people.

Another great way to get your product visibility on Amazon is through promotional giveaways, or what we call Launches.

It shouldn’t come as a surprise; ranking on Amazon is extremely important. The higher up a product ranks on Amazon, the more eyes there are on the listing, which equates to more sales opportunities. Most shoppers don’t make it past the first couple of pages  – if that – when shopping for a product on Amazon. That’s why page one positions for major keywords are so coveted.

Many sellers use promotions as a way to boost sales and drive more traffic to their listing by providing deep discounts on their product for a period of time. If you’re interested in launching your product this way, check out our 9 common mistakes to avoid.

Another popular way sellers use to increase a product’s visibility is by bringing in traffic from outside sources, such as running ads on Facebook, Google or other platforms that direct buyers to their Amazon listing page.

 

  1. Manage Inventory

Managing inventory is a crucial step to maintaining a successful Amazon product. If you don’t properly manage and track your inventory, you will find yourself out of stock and low on cash. Not to mention, being out of stock for too long can significantly hurt your rank, which can have devastating effects on sales in the long run. 

When managing inventory as a seller, there are two important factors to consider – how long it takes for you to get a shipment from a manufacturer and how many units you sell per month, on average.

For instance, if you get your inventory 60 days (or two months) after placing an order from your overseas manufacturer and you’re selling 1,000 units per month, you’ll need to make sure you order at least 2,000 units. That would give you two months (or your lead time) worth of inventory. And if you have the cash, ordering a bit more will give you some cushion in the case of delays or an increase in sales.

Like with any business model dealing with physical products, selling on Amazon FBA Private Label means a lot of cash will be tied up in inventory. That’s why managing inventory correctly is so important. If you don’t, you run the risk of going out of stock without enough cash on-hand for a reorder when you need to.

 

I’ve Learned How to Sell on Amazon – What’s Next?

So now you’ve got your Amazon business up and running. Maybe you’ve just made your first sale or things are going great and you’ve already had to restock.

But as profits rise, so does that entrepreneurial spirit. This might lead to asking … what’s next? You have a few options. One is to add another product to sell in the same or a completely different category.

Or, you might just want to stay with your first product and build profits for some supplementary income. Whatever you choose, make sure it’s what’s best for you and your goals. That’s the best part of being your own boss, isn’t it?

At its core, Amazon is an ecosystem that’s constantly changing. That means you have to stay up to date on Amazon’s Terms of Service and best practices. But luckily, there’s no shortage of information about how to sell on Amazon for beginners or for experienced veterans.

Here at Viral Launch we want to be your go-to source for the most accurate and recent Amazon information. That’s why we recommend you subscribe to our blog! Are you more of a visual person? Not to worry, check out our Youtube channel. If you’re looking for a great podcast to listen to during your commute or while traveling, we suggest listening to our podcast Follow the Data.

You’ve got all of the tools to be successful at your fingertips. Now it’s up to you! We’ll leave you with one final thought about what you need to be successful in the form of a quote from Madam C.J. Walker:

“I had to make my own living and my own opportunity! But I made it! Don’t sit down and wait for the opportunities to come. Get up and make them!”

Is Amazon Removing Reviews? Here’s What’s Happening With Amazon’s Review Chaos

Is Amazon removing reviews? The Amazon FBA landscape is changing FAST. Far faster than we’ve ever seen. And I wouldn’t bet on it slowing down anytime soon. It’s those brands that are willing to embrace change, adapt, and play by the new rules that will always come out on top.

Possibly the hottest topic for sellers—and the area that is seeing the wildest changes right now—is Amazon’s review system. We’ve identified six major review changes over the last couple of months. Some of them have had devastating effects on brands.

Without any formal statement or direction from Amazon on policy or structural changes, we in the seller communities are (classically) left in the dark wondering what’s going on. Some of us are asking what we’ve done wrong, and all of us asking ourselves what’s the best way to move forward.

As always, the Amazon seller forums and Facebook groups are running wild with speculation and questions as to what’s going on with the latest review changes, and few truly have a grasp on the magnitude of some of these changes.

If you’re at all familiar with Viral Launch, you know we are a data-driven company. And you know that we love to answer questions and solve problems with vast amounts of data (I mean how else? 😉 )!

To find out what is happening with reviews, we used the advanced data aggregation of our product and market research tools, Market Intelligence and Product Discovery. These product trackers gather historical and real-time data on well over 100,000,000 Amazon products. So we were able to uncover some jaw-dropping stats. You’ve got to see!

Change 1 of 6: Amazon Removing Reviews or The Great Amazon Review Abduction of 2018

Some of you have likely heard of or experienced a brand or product where Amazon was removing reviews over the last month or two. You—like everyone else—were probably asking yourself questions like, “How widespread is this?” and “Have other sellers lost as many reviews as me?”

We had the same questions. So our engineers started crunching the numbers. And here’s a glimpse of just how widespread Amazon’s latest review removal was. We should note that we are still working through the data to try to make it as clean as possible. There are a lot of moving parts when it comes to reviews, including changes and discrepancies in variations. 

For each top-level category in the Amazon US market, we looked at the top 10,000 best selling ASINs with at least 90 days of history. From that set of products, we looked at how many of the listings lost reviews, which listings lost the most reviews, and how many reviews the category lost as a whole.

Here’s a summary of the report showing just how huge and far-reaching this review abduction is:

Reviews Removed between May 1 and May 31

Top 5 Categories with Highest Number of Reviews Removed from May 1 – May 31:

Cell Phones & Accessories: 324,423 reviews removed!

Health & Household:   305,777

Grocery & Gourmet Food: 204,553

Beauty & Personal Care: 193,242

Tools & Home Improvement: 177,375

Top 5 Products Hit With Review Removal:

Etekcity Digital Scale (B073W64CY8): 13,999

Pansonite VR Glasses (B07516YQ59): 10,202

       Bark Solution Dog Collar Training System (B01HSH194S):  6,690

Fox Print Princess Castle Play Tent (B0120XRWLE): 1,710

Amazon Basics Stainless Steel Kitchen Scale (B06X9NQ8GX): 1,472

Top 5 Most Affected Categories by Percent of Listings Affected:

Cell Phones & Accessories: 21.08% of the top 10,000 listings had reviews removed

Camera & Photo: 19.43%

Video Games: 19.05%

Health & Household: 17.66%

Sports & Outdoors: 17.39%

Download the full guide by entering your email in the form below!

The category that lost the most reviews was Cell Phones & Accessories with 2,108 of the top 10,000 listings losing 324,423 reviews. That’s the total number of reviews that we saw Amazon removing between May 1st and 31st. When accounting for the reviews that sellers regained (organically and otherwise), the category still came out with a net loss of 185,302 reviews.

The single listing that lost the most reviews in the Cell Phones & Accessories category was this Pansonite 3D VR Glasses. The listing lost 10,202 reviews taking them down from 10,339 reviews to just 65 reviews at its lowest!

The category that was hit second hardest was Health & Household with 1,766 of the top 10,000 listings losing 305,777 reviews. Accounting for reviews gained and re-gained, the net loss for the category was 177,324 reviews. Of the 10,000 Heath & Household listings we analyzed, the single listing that lost the most reviews was this Etekcity Digital Scale (B073W64CY8) which lost 13,999 reviews. 

You can see the spikes and drops in their review count using Market Intelligence. It’s crazy to look at the review graphs for some of these listings that lost a ton of reviews. You can see where Amazon removed the majority of their reviews and that they quickly got them back. Then Amazon removed them again, and the seller recovered the reviews again. This Etekcity Scale is an excellent example!

These graphs show you just how crazy things are right now. You can see these sellers fighting for the life of their listings. Losing that many reviews changes a product’s star rating, drastically affects the product’s perceived popularity, probably forfeits Best Seller and Amazon’s Choice badges, and just, in general, destroys a listing’s credibility, which we know affects sales.  

Change 2 of 6: Reviews Being Blocked.

*The specifics of this section seem to currently be in a state of change, so depending on when you are reading this, it is possible that changes may have come about. Some of the tests were limited in scope as we wanted to leave reviews in an ethical fashion. The concepts and context are what’s most important.

From our perspective, this was the scariest change of the six we’re listing here.

To summarize, Amazon seemed to have put proverbial speed limits in place when it comes to review acquisition velocity. For the month of May and into June, it seemed as though Amazon was limiting the number of reviews a product could obtain in a day. If you exceeded the threshold/speed limit, the product would be punished with a review block for some period of time ranging 3 to 7 days.

Two very interesting facts from this finding:

1) unverified and verified reviews were treated separately

2) the review limit was a static number.

Let me explain.

After a bit of testing and observing, we noticed that receiving 3 unverified reviews in a day would cause Amazon to block the ASIN from receiving any additional unverified reviews. Similarly, after receiving 6-8 verified reviews in a day, Amazon would block the ASIN from receiving any additional verified reviews. And customers would see some form of this message:

PRO TIP: Unverified reviews are reviews in which the reviewer has not purchased the product on Amazon, or has purchased with a heavy discounted code

From what we could tell, the first time a review block was initiated, the product was put on a 7-day review block (for both verified and unverified reviews). We believe that during this time Amazon conducted an audit, combing through the account to try to develop an understanding of the authenticity of the reviews. We believe Amazon would look at things such as the content of the seller’s email follow-up sequence, the referral path of the reviewer, etc. If everything checked out, the product’s review block would be lifted (meaning it was again eligible to receive reviews), and if things did not check out, the account was suspended.

But passing the initial suspension did not mean you were completely in the clear! The majority of products that continued to exceed the Amazon imposed speed limit would have the review block reinstated. If a product reached the limit of 3 unverified reviews in a day, it would be blocked from receiving any additional unverified reviews. But it could still receive verified reviews. Similarly, if 6-8 verified reviews were left in a day, then the ASIN would be blocked from receiving additional verified reviews. These blocks seemed to last for 1-3 days at a time. We saw several listings cycle through this process multiple times.

For our clients with products selling 1,000+ units per day, receiving 6-10 reviews in a day is not uncommon. It was quite surprising that Amazon would choose to use a static number versus a percentage of sales. And it creates a very frustrating experience for sellers.

This review blockage was not exclusive to ASINs offered by third-parties. Many of Amazon’s own high-volume products had review blocks in place at one point or another.

At the time of this posting, here is a high volume product (#3 best seller in Beauty & Personal Care category) that currently has a block in place for unverified reviews. When you click on the star rating, you will see a pop-up stating that your review cannot be accepted at this time.

While review blocks are still happening, from what we’ve observed, as of mid-June, there have been far fewer than in May. We don’t yet have the answers as to why. Perhaps Amazon has adjusted the speed limit to a percentage of sales rather than a static number. Maybe they decided that one account review analysis was enough. Only time will tell.

We are grateful to Amazon for stepping up their game in terms of monitoring and enforcing the rules when it comes to reviews. A lot of the existing rules harm the ToS-abiding sellers while bad actors gain a competitive advantage by cheating the system. We really hope that, at the least, this is an indication of Amazon beefing up security and enforcement of their inauthentic review policies and programmatic monitoring.

Why this change was so scary.

This change challenged some of the fundamental dynamics of being a third-party seller on Amazon. The very reason our customers have been able to build successful million-dollar businesses (and sometimes tens of millions of dollars) is they are able to develop competitive advantages in their market. Those advantages range from the ability to drive keyword ranking in organic search results, drive better conversion rates through product photography and better listing copy, having a better product and so many others.

A seller’s ability to drive quality reviews faster than their competitors is an important advantage in a savvy seller’s toolbelt. Being able to drive reviews faster than your competition allows you to enter an existing market with 0 reviews, strategically drive reviews to catch up with competitors that may have hundreds or thousands, and achieve maximum sales potential. If you and your competitors were restricted to driving no more than 10 reviews per day, it would be impossible to catch up to existing players and obtain a relatively competitive number of reviews in a market, which could severely inhibit your ability to ever drive meaningful sales volume in that market. If this change came to fruition, it would not be as impactful if Amazon made the systemic review change we anticipate them to make, which we talk about in a podcast episode here.  

The opportunity for success as an FBA seller exists in the competitive advantages. Any erosion of opportunity for competitive advantage will make it more difficult for new products and new sellers in existing markets. We firmly believe that the high degree of competition on Amazon has been key to Amazon’s success as well as our clients’ success, so any potential infringement on that is intimidating.

Change 3 of 6: Reviews Split By Variation

The way that reviews are being attributed to variations is also changing. It used to be that if you had a listing with variations a, b, and c, the reviews for each of those variations would be aggregated for a total review count and star rating that applied to each variation on the listing. So the total number of reviews for the each ASIN would be the same. That means if someone bought your purple flashlight and left a review, that review would apply to the red variation, the black variation, and the green variation.

Not so in the new world of Amazon reviews! Amazon is slowly making a switch in the way that it handles reviews on listings with variations. Instead of applying a review for a variation to the whole listing, if someone leaves a review for, say, that purple flashlight, it will only show up on the purple flashlight variation.

So as a shopper is clicking through the product variations, the star rating and the review count under the title will change. That means if no one has leaves a review for your green flashlight yet, it will show up as having no stars and zero reviews!

Here are a few examples:

This change in the way that Amazon is handling reviews for variations also means that if someone does finally leave a review for your green flashlight and it’s a 1-star, your rating for that variation is going to be really low. Even if you have a 5-star rating for the other variations. This is potentially bad news for sellers. It means that every variation you have is going to have to be top quality. And your strategy for providing stellar customer support and preventing bad reviews has to be good. 

Change 4 of 6: Seller Feedback Lost to a New Rolling 12 Month System

Have you ever jumped in your car to go somewhere and realized that you don’t have your cell phone with you? You run back inside and spend the next 15 minutes tearing your house apart trying to find it? Yeah. This is nothing like that.

This is like realizing you don’t have your cell phone, and running back inside to look for it except now your house is gone. And so is your cell phone, which you left on the kitchen counter by the way.

Seller feedback is being moved into a rolling 12 month system. This new system is especially significant for Retail Arbitrage, Online Arbitrage, and Wholesale people. Seller rating is a big part of what allows RA, OA, and Wholesale sellers to win over customers.

You know how when a shopper clicks on New (10) from $5.90  they are taken to a page with all the offerings on that listing. And each of those offerings is being sold by a seller with a rating. Well now instead of seeing that seller’s overall rating, Amazon is showing customers a rating from “over the past 12 months.”

So if you got four 1-star reviews in the last 12 months, those hold a lot more weight than they used to. Let’s say you used to have 2,000 seller reviews and 5 of them were 1-star reviews. That probably wasn’t pulling down your overall rating too much.

But now that Amazon is only looking at that last 12 months, it’s only looking at the last 500 reviews that you got. And four of those 1-star reviews happened during that time. Now you’re feeling those 1-star reviews in your rating.

But this change is not happening across the board. We’ve only seen certain seller accounts where the change has been implemented. So if you haven’t been affected yet, consider yourself lucky. This inconsistent introduction of a new system could end up being totally unfair to those sellers who have been pushed in already and whose star ratings may look less favorable than their competitors who are still part of the lifetime review system.

Under the rule of the new 12-month rolling reviews, consistency is the name of the game. You have to deliver an awesome customer experience with every single product on every single order if you want to be among the top-rated sellers on the platform.

Change 5 of 6: “The Great Amazon Reviewer Purge”

Amazon is getting rid of thousands of top reviewer accounts. After Amazon banned incentivized reviews in October of 2016, top reviewers started being kicked off the platform if Amazon suspected that they were not complying with the changes.

Amazon has been purging their Top 10,000 reviewers, banning them from the platform. In the subreddit The Great Amazon Purge, you can track how many reviewers have been removed so far. The subreddit has actually been tracking the number of removed Top 10,000 reviewers since February of 2016.

At the time of this posting, 4892 of the Top 10,000 reviewers have been removed.

Change 6 of 6: Suspension Changes And Account Bans

While the majority of Amazon sellers cite their number one fear as having their privileges revoked from selling on Amazon, we have very rarely seen this actually happen in the private label world (and for context, it was one seller of the 10,000+ we’ve worked with and was due to continued review manipulation).  An Amazon account suspension is incredibly scary and can be devastating to monthly financials too. From our limited experience, intuitively, we’d guess the average account suspension lasts no more than a week (would love some data on this if anyone wants to share!). From our sources, there is a new rule for suspensions due to review manipulation, and it comes in at whopping 21 day minimum suspension! That is tough!

From what we know, if there is an additional review manipulation infraction, the seller account will be BANNED. The kiss of death.  Unfortunately, we’ve seen this happen to two major accounts and I imagine many others (we did not dig into the data around account suspensions/bans, we’ve merely heard of these instances through the grapevine). Unfortunately, we do not have any specific information around the why behind these accounts being shut-down by Amazon.

How To Move Forward With Reviews

The problem with any definitive suggestions in moving forward on Amazon, especially when it comes to reviews, is that we are not 100% confident in where the line of appropriate behavior versus non-ToS compliant behavior falls. If all of our questions could be answered, or the ToS was completely comprehensive, then as a company, we’d feel much more confident in providing a “best review strategy”.

The short answer is that right now, we suggest being conservative in your review acquisition strategy. This is especially our advice if your account has been suspended due to review manipulation. Over the next few months, we’ll start to develop a better conceptual understanding of what Amazon deems acceptable and what they view as unacceptable.

Some account managers for our largest clients have even made the suggestions to stop sending all email follow-ups that mention the words review, feedback, etc. We are not saying that well-worded email follow-up sequences will lead to suspension, we just want to provide you with as much information as possible so you can make the decision about what activities to leverage in your review acquisition strategy.

It should go without saying that as a company, our suggestion is to abide by Amazon’s TOS when it comes to obtaining reviews. Knowing exactly what is and is not within TOS is another question. We still see many sellers participating in review groups (predominantly those in Facebook groups), and we cannot encourage you enough to stop this. We have strong evidence that a number of these groups have had the brands participating in these groups suspended. For those that are unfamiliar, there are secret Facebook groups in which a buyer offers to purchase a product at full price and leave a review, and the seller reimburses the buyer through a payment provider such as Paypal.

As our understanding of what is/is not acceptable in terms of review acquisition strategies, we will be sure to post updates. Reviews are a critical component of Amazon success and can be a major competitive advantage. We want to make sure that you are best equipped to avoid unintended suspensions and gain a competitive advantage with the most powerful, yet TOS compliant, review strategies available.

For more Viral Launch, data-driven insights. Subscribe to the blog. We’ll notify you whenever we have a piece of big, impactful information, like this, so you can stay on the cutting edge of Amazon seller success.

 

 

Selling on Amazon vs eBay: Which Is Better?

Online Shopping is seeing year after year growth.  In fact, Retail e-commerce sales worldwide are forecast to nearly double between 2016 and 2020.  If you’ve thought about selling online, now is the time to ride the e-commerce wave to boost revenue.  But which online marketplace should you invest your time, resources, and products?  Should you diversify or go all in on one?  While there are several online marketplace options to sell, we’ll specifically be comparing selling on Amazon vs eBay in this post.

AMAZON SELLERS VS. EBAY SELLERS

In this year’s letter to shareholders, Amazon announced that, “Over 300,000 U.S.-based SMBs started selling on Amazon in 2017.” That’s a lot of new sellers on the platform, and that doesn’t even capture the individuals sellers and larger brands who are all rushing to list their product in Amazon’s ecommerce catalog.

Amazon Sellers

Amazon’s brand awareness as the go-to online store with lightning fast deliveries and excellent customer service draws shoppers like a giant consumer magnet. And that makes it very appealing for sellers. So appealing that many sellers on the platform do not sell their product anywhere else. But with more and more sellers jumping on the platform, competition has increased. And that means customer expectations have increased too.

It’s not enough to ship a product from your garage and have it arrive a week after purchase. Customers want their orders at their doorstep tomorrow. And they want that product to be quality. If it’s not, one bad review can knock down your rating and potentially your conversion rate and your ranking.

Overall, what this more competitive landscape means for the type of sellers on Amazon’s platform is that they are becoming more and more higher-caliber. They are becoming more and more competitive. Those who succeed and win a good ranking position know how the platform works, and they know how to succeed.

eBay Sellers

eBay sellers on the other hand span a wider range. Unlike Amazon, there are not large brand names on the platform. But there is a wide spread of seller types from large, competitive sellers with some brand recognition to the online-yard-sale individuals who are selling single items they are trying to get rid of.

While Amazon sellers battle the high expectations of customers on the Amazon platform, eBay sellers battle quite the opposite: the idea that all items on eBay are used or second-hand. This is probably one of the reasons that eBay sellers list their products on multiple marketplaces. eBay attracts a different kind of customer too, which lends it to certain products more than others.

AMAZON CUSTOMERS VS. EBAY CUSTOMERS

In the selling on Amazon vs eBay discussion, both have unique customer bases that set them apart and make them more or less favorable to certain products. Before you decide where to list your product, you’ll want to make sure that there is good demand for it with the customers on the platform.

Amazon Customers

Amazon is the most popular online store in the United States, according to Statista. It has by far the largest market share for ecommerce. So who are these Amazon customers? Compared to customers on other ecommerce platforms, they are generally more educated and more well-off than the average American. Here are the four most distinguishing traits of Amazon customers:

  1. Younger. According to Digital Commerce 360, over 50% of Amazon shoppers are under the age of 45. Prime customers tend to be even younger than the average Amazon shopper, with 18 – 34 being the most Prime-heavy age group.
  2. Higher Income. Amazon customers are predominantly male and tend to have higher incomes. Amazon captures 90% of the 50 – 100K income shoppers, and 89% of the 100K+ shoppers. And even for shoppers with an income under 50K, Amazon still captures 73% of the market.
  3. Bigger Spenders. Prime members are especially keen on Amazon’s free 2-day shipping and tend to buy more than non-Prime members. And with Prime membership in 64% of US households, that means Amazon customers are spending more on the platform than ever before.
  4. Trust the Amazon brand. Amazon customers trust the Amazon brand for quality products, timely delivery, and excellent customer service if anything does go wrong with an order. Amazon customers are also sometimes unaware that they are even purchasing from a seller at all. Thinking rather that they are purchasing “an Amazon product.”

Overall Amazon has captured most US shoppers, especially those under 45 years old, making over 50K. And since their customers do tend to be wealthier, they come with higher customer expectations. This is especially true of Prime members, Amazon’s biggest shoppers. The Amazon brand is one that customers deeply trust and masks the marketplace experience for customers by providing them with fast shipping and incredible customer service.

eBay Customers

eBay, though not as popular as Amazon, continues to be a big player in ecommerce. According to Statista, “In the first quarter of 2018, eBay reached 171 million active users.” And though smaller than Amazon’s customer base, 171 million is still undeniably significant. Here are the four most distinguishing traits of eBay customers:

  1. Older. eBay customers tend to be older than Amazon customers, with 61% over the age of 45. Like Amazon, they tend to be mostly male.
  2. Medium income. While an exact income range for eBay customers is hard to pin down, it seems to generally be lower than the average income for Amazon customers.
  3. Deal hunters. eBay customers also tend to come in with the expectation that they will pay less for the item they are looking for. While Amazon used to be a lot more competitive on price, customers, especially Prime customers, seem to be willing to pay more for the convenience of 2 day shipping and a wide-reaching catalog.
  4. Less trust in eBay brand. eBay customers do not trust in the eBay brand name in the way that Amazon customers trust the Amazon brand name. Rather, they trust the brand of the seller they are purchasing from. The expectations for customers satisfaction are put on the seller rather than on eBay as the platform.

Overall, eBay is still a significant size market that is more popular with older shoppers, especially those over 45. Since their customers tend to be of average means, they are more motivated to find the best price and pay less for the item they are looking for.  eBay customers are much more aware of eBay as a marketplace than Amazon sellers and trust the brands of the sellers they purchase from rather than eBay’s brand.

AMAZON PRODUCTS VS. EBAY PRODUCTS

The types of products that customers buy on Amazon and on eBay are different. Each platform has its own strengths and draws shoppers for those specialties. It’s important to know these comparisons when weighing up selling on Amazon vs eBay.  

Amazon Products

Amazon’s catalog has 562 million products in its catalog with Clothing, Shoes & Jewelry being the biggest category by far. Amazon’s top selling categories are:

  • Consumer electronics
  • Home and kitchen
  • Publishing
  • Sports and outdoors

eBay Products

eBay’s catalog has well over 1 billion live listings. According to the site, some of its best selling products include:

  • Electronics
  • Fashion
  • Video games
  • Collectibles

While both sites sell electronics and fashion items, Amazon sells far more books than eBay. Amazon also sells more Sports and Outdoor equipment whereas eBay sells more collectible items. Shoppers looking for unique, vintage, or antique items will look to a platform like eBay. And shoppers looking for books, outdoor equipment, and items that they need to arrive quickly will look to Amazon.

AMAZON FEES VS. EBAY FEES

As we look at fees in the selling on Amazon vs eBay comparison, the associated fees are a crucial factor.  We’ve written a fuller blog focused on Amazon seller fees, but we’ll give an overview of both here.

Amazon Fees

Amazon fees vary depending on how the item is sold. There are two main ways to sell a product: as an individual or as a professional. An individual is anyone selling less than 40 items a month. Think college students selling their used textbooks. Professional sellers are those looking to supplement or replace their income, including retail arbitrage sellers, online arbitrage sellers, wholesale sellers, and private label sellers.

Individual Seller

  • Per-item fees
  • Referral fees
  • Closing fees

Referral fees depend on product category but are typically 15% with a minimum fee of $1.00. See the full list of referral fees by category here. Closing fees are $1.80 per item sold and apply only to media items such as books, DVDs, music, software & computer/video games, videos, and video game consoles.

Professional Seller

  • Professional account subscription
  • Referral fees
  • Closing fees
  • Shipping fees (if applicable)

A professional seller account is $39.99/month and replaces the per-item fee charged to individual sellers. Referral fees depend on product category but are typically 15% with a minimum fee of $1.00. See the full list of referral fees by category here. Closing fees are $1.80 per item sold and apply only to media items such as books, DVDs, music, software & computer/video games, videos, and video game consoles. Some professional sellers use Amazon’s fulfillment program (Amazon FBA) to store, pack, and ship their products to customers. FBA has its own fees, which you can see here.

eBay Fees

eBay fees are seemingly less complicated than Amazon fees. But eBay is set up for individual sellers with individual items more than it is set up for sellers with multiple skus (stock keeping unit) and multiple items for each sku. There are two main fees that eBay charges sellers:

  • Insertion or listing fees
  • Final value fee

The insertion fee works a little differently depending on how you are selling your products. If you are selling individual products auction-style, eBay gives you 50 free listings per month with a $0.35 insertion fee after your 50th item.

If you are listing a product with a fixed price and hundreds or thousands of items in stock, eBay will charge you an insertion/listing fee up front and every 30 days until all items sell out or you or eBay closes the listing.

The amount you pay for this insertion fee is calculated based on what eBay calls the total start price of the listing. The total start price is the sale price of the product multiplied by the number of items available for sale. So if you’re selling a $15 t-shirt and have 1,000 on the listing, the insertion fee will be based on a start price of $15,000.00.

The other main fee that eBay charges is a final value fee. The final value fee is a percent of the final amount the buyer pays, including shipping and handling but not tax. Final value fees are typically about 10% with a cap of $750.00. So if a customer purchases all 1,000 of your $15 t-shirts, your final value fee would be capped at $750.00 rather than being the full $1,500.00.

eBay also charges a few additional fees:

  • Listing upgrades
  • Select category fees

Sellers have the option to pay small fees for listing upgrades like bold font, subtitles, international site visibility, dual category inclusion, Gallery Plus, and Listing Designer. These fees depend on the price of the item and the duration of the upgrade. See all options here.

eBay also charges additional fees for items sold in certain categories, including motor vehiclesreal estate, and select business and industrial items.

Who Should Sell on eBay

Because eBay is a smaller marketplace, it is a great way to get your feet wet with e-commerce. You can start selling on eBay with a lot less money, and drop shipping is a viable option. Customer expectations on eBay are lower, and eBay as a platform is more lenient when it comes to requirements for listing your product and customer satisfaction.

Who Should Sell on Amazon

Because Amazon is a bigger marketplace, it is more competitive. That means the cost to compete is higher but also that the reward for success is higher too. There are thousands of product markets that see healthy sales every month where competition is still low. And if you are lucky enough to find one of these markets, the rewards for performing well on Amazon are greater than they will ever be on eBay.

If you have a smaller budget and are thinking of drop shipping, Amazon is probably not the place for you. With high customer expectation, Amazon has strict requirements for their sellers. If you find yourself with too many unhappy customers and late orders, you could be off the platform.

But if you have a bit more of a budget to work with and are looking to sell a large volume of products to a large audience (especially if you are looking to utilize Amazon’s FBA program), selling on Amazon is the way to go.

Recap

Selling online is a huge opportunity for business entrepreneurs.  As you research selling on Amazon vs eBay, you’ll want to know the buyer demographics, marketplace strengths, fee comparisons, and the seller options available to you.

  • Amazon buyers have generally higher income and are younger while the average eBay buyer is older and looking for a bargain.
  • eBay is more lenient with a lower barrier of entry while Amazon is more competitive but with a higher potential for sales
  • eBay has fewer fees than Amazon and will generally be more profitable but requires you to be more hands on with the whole process.
  • Amazon buyers expect higher quality and faster shipping while eBay buyers sometimes assume the products are second hand or less quality.