Now that you’ve got both feet on the ground as an Amazon seller, the tricky part is finding what products will put you ahead of the pack. You can look at snapshot estimates from a random collection of sourcing tools, piecing together what you hope is an accurate picture of the market and product — or you can improve your chances of sourcing only the right products by making use of the right Amazon market intelligence.
Viral Launch’s Market Intelligence tool gives you the most comprehensive access to Amazon-wide insight across billions of different data points. With it, you can make truly informed decisions and validate any product before you ever launch it.
What Real Amazon Market Intelligence Looks Like
Intelligence is nothing without data, which is what makes our Amazon Market Intelligence tool so valuable. It’s the only tool that can collect and leverage data points from across Amazon’s entire market. With the data the tool gathers for you, you can glean the kind of insight and analysis that can help you almost predict the success of any product launch. For example, the billions of data points you’ll have access to can help you assess markets and products by:
1. Name brands: See whether any big household names or Amazon itself is selling in the market. It will be easiest for you to compete against other smaller brands, so stay away from markets that are dominated by one brand or a few dominant brands.
2. Sales spreads: If a few products are claiming most of the sales in the market, it’ll be harder to claim a piece of the pie, especially as a newcomer. Look for markets where sales are spread pretty evenly between the products on the first page.
3. Competitors’ intelligence: Finding a few products dominating sales spreads isn’t necessarily a bad thing. Use the Market Intelligence tool to reverse-engineer their strategies. For example, track what keywords the dominating products use in sponsored ads and make a list of your own variations.
4. Market trends: Sales trends tell you a lot, but if you want to determine which trends are fads and which are actual depictions of the market, you’ll have to look at data from across a few years. Use market trends to avoid investing too heavily in the next fidget spinner.
5. Price margins: Even with a great product, you won’t make a profit unless you can cover Amazon’s fees and still stay price-competitive. You can research the cost of sourcing units from a site like Alibaba, then plug it into our Amazon FBA calculator.
6. Product reviews: Speaking of being competitive, you can enter the competition a lot sooner in a market where mediocre performance is the norm. Research reviews throughout the market and pay special attention to those that are generally low.
7. Product fulfillment: Finally, stay away from markets filled with FBA (fulfilled by Amazon) or AMZ (Amazon original) designations. If your products are FBA, then you can compete more effectively in markets that are mostly filled with FBM (fulfilled by merchant) products. Data can mean the difference between entering a market and thriving in it — or sinking fast due to poor intelligence. With our Amazon Market Intelligence tool, you can make sure you end up on the thriving side every time. To learn more, sign up for a free trial today!
As an Amazon seller, you know that product research and selection is by far the most important decision you will make. The product that you decide to sell is the largest determinant of success or failure for your Amazon business as a whole. The wrong product sets you up for failure from the very beginning, while the right product allows for incredible money-making opportunities.
In recent years, selling on Amazon became increasingly competitive and difficult, and because of that, finding the “right” product has also become more difficult. There are more sellers who are using more sophisticated software and marketing dollars, allowing them to extract the best opportunities and bully their way to a great sales volume!
In such a competitive landscape, the question becomes, “Where is the opportunity for me to succeed?” And, “What is the probability for that success?”
Here at Viral Launch, we’ve been honored to help thousands of sellers build successful Amazon businesses over the years. This experience has provided deep insights into the tactics of super successful Amazon sellers, and it helps us stay ahead of the trends.
Despite the increased competition, we’ve put together this in-depth guide to walk you through a new Amazon product research strategy. This process will significantly improve your probability of sourcing money-making products every single time.
Unlike a typical guide to Amazon product research, this new approach will change the game, helping you to identify profitable product ideas while circumventing your competition.
All the data we’ve collected points to this being THE most comprehensive Amazon product research and selection method available!
Phase 1: Define Your Perfect Amazon Product
In order to find “the perfect product” you have to know what the perfect product actually looks like.
Imagine being asked to find your mom’s friend Howard in New York City’s Central Park during peak summer time, but you have no idea what he looks like and have never been given any details about his appearance (height, age, hair color, etc.). If you don’t know what you’re looking for, “he” is hard to find.
Understanding what makes the perfect product for you is the foundation to product research, so we want make sure we get this step right!
Step #1: Know Your Budget
It’s pretty easy to talk to a manufacturer, or page through Alibaba, and get a feel for how much a shipment of product will cost. That said, understanding your necessary budget for completely sourcing a product is quite a bit more complicated. You will incur regular fees such as your Seller Central subscription, fulfillment and referral fees, and logistical costs (importing and shipping to Amazon), one time fees for things like packaging design, professional photos, and trademarking, and finally, fluctuating costs for things like advertising, promotion, and review generation. If you’re looking to source your first product, there will also be general business related costs as well.
Understanding these fees is crucial to building a successful Amazon business, or any business for that matter. Logging, predicting, and planning for these costs will help you to have a better sense of your potential margins, profit, and growth.
So how do you apply this to sourcing a new product?
You need to know what you can afford. Amazon is an almost limitless sea of products. You need to look at your budget and figure out what you can afford to source, what quantity you can afford to source, and how much capital you will have to reorder before you start seeing any cash flow.
If you can only afford to order 100 units of a product, but it can easily sell over 1,000 units in a month, it’s probably not the right product for you. If it’s going to cost you $15 per unit to source a product that sells for an average of $20, it’s probably not the right product for you. If ordering a first shipment is going to totally absorb your budget, you’re either going to need more capital or a different product.
Understanding your budget is a crucial first step to finding a successful product.
Step #2: Know Your Revenue Goals
It’s all too common for a new seller to look at Amazon as a ‘get rich quick’ venture. Heck, there are thousands of videos, social media posts, and gurus talking about how they made $1 million a month on Amazon and how you can too if you just buy their course, software, or subscribe to their email list!
The truth is, people DO rapidly find unbelievable success on Amazon…but people DO also win the lottery. Starting a business can be a gamble, and you are assuming risk. But unlike the lottery, you have the ability to play smart.
One of the most important ways to do this is to set realistic revenue goals. The three main variables that determine your potential revenue are budget, sales quantity, and selling price.
When looking at the relationship between budget and revenue, it’s somewhat analogous to an investment portfolio. When investing, you typically find that more capital produces higher gains (assuming that the market doesn’t collapse). You can invest aggressively, with increased risk but increased potential reward, or you can invest in safer options, which are lower risk but have smaller rapid growth potential. In either case (unless you hit it big last year with cryptocurrency), if you’re investing $5,000, you’re not going to (quickly) turn it into $1 million.
The same can be said with Amazon. There is absolutely a risk vs. reward correlation, but you’re not going to quickly hit $1 million in revenue from a $5,000 investment. Amazon can be an outlet to quickly build a successful business, but it’s not magic. When establishing your goals for revenue, aligning your expectations with your budget is an important consideration.
With regards to sales quantity, a market research tool (like Market Intelligence) gives you the ability to understand the potential for a product, but you cannot do much to influence it. For example, if your top competitors are selling around 500 units per month, it’s unrealistic to think that you can sell 1,000 units per month. Markets can be influenced by seasonal cycles and social trends, and you can employ marketing tactics to increase awareness. However, when setting a revenue goal, it’s important to know that your potential is dictated by the market demand.
On the other hand, you do have some control over price (though not as much as you might think). When sourcing a private label product, you can technically sell your product for any price that you’d like. That said, your price should be limited (if not dictated) by the competition.
Think about this from the perspective of a shopper. If you’re looking to buy a mousepad on Amazon, are you more likely to buy one for $5 or $20? The $20 pad might be a bit fancier, but all you’re probably looking for is a basic black mousepad for your desk.
So as a seller, you can create any price for your item but a shopper can also choose any alternative. A higher-than-average market price can limit your potential sales quantity, therefore limiting your potential revenue.
Returning to the concept of setting a revenue goal, it’s important to look at the prices and sales quantities in your market. If you’re looking to generate $20k in monthly revenue and you’re selling your product for $20, you need to be able to sell 1,000 units/month. This is definitely doable in some markets, but if the top sellers in your market are moving around 500 units per month and/or if the average selling price in your market is $10, you may need to set a more realistic goal or look for a new product.
But, as Amazon becomes more competitive, it’s becoming more important to not put all of your eggs in one basket. Diversity (much like a stock portfolio) can be the key to success in e-commerce.
Say you can’t realistically hit your revenue goal with one product. Maybe you can do it with two.
As markets get more crowded, review quantities increase, and prices decrease, looking for several smaller, promising opportunities can prove to be more beneficial than looking for that one gold-mine product.
Step #3: Understanding Micro-Niches
Now that we’ve covered your budgeting and goals, it’s time to understand how to find the right product for you.
Amazon has changed a lot over the last few years. Competition, and Amazon’s dominance over e-commerce, has increased. In the past, the strategy was to find a market/niche to sell in, such as bed sheets. Now, because of the depth of competition, focusing on these broad markets can spell doom for a new product. While it’s true that the largest search volume remains in these broad markets, the depth of competition and a product’s ability to convert make it incredibly costly to market and difficult to succeed.
Instead, finding a product should now be about looking for micro-niches. A micro-niche is a market within a market… one with more specificity. For instance, instead of sourcing a set of bed sheets, you should look at sourcing something like flannel sheets. This market may not have the same depth of search volume, but shoppers will still be searching with this keyword, and you’ll be able to filter out a lot of competition. Additionally, because the niche is more specific, your product is more likely to consistently convert.
As Amazon grows, there is a bigger pie to be shared among markets. As competition on Amazon grows, each markets’ piece of the pie gets shared between more products. With that logic in mind, the concept of micro-niches can be employed to find easier to reach pieces of the growing pie while avoiding a lot of markets that are being fought over.
Phase 2: Find Hot Micro-Niches
So how do you find these micro-niches that provide opportunity within more specific markets?
We’ve added a new feature to our product finder, Product Discovery, to make your Amazon product research easier than ever. This tool allows you to input what kind of product you’re looking for with filters, which will result in identifying product markets that match your specific criteria.
Within Product Discovery’s Keyword Search function, we’ve included a new filter called ‘Keyword Contains’. This feature allows you to search using a main keyword to help identify profitable micro-niches within a specific market.
To illustrate the use of this feature, let’s walk through how to quickly and efficiently identify micro-niches within the Product Discovery.
Assuming that I don’t have a large budget to work with, I want to look for something that I can source for a low cost. While you can definitely use a product-oriented keyword (like ‘bed sheets’) to find micro-niches, I’m deciding to base my search on a low cost material: paper.
While selecting specific categories is typically my first filter, in this instance (because I don’t necessarily know what I’m looking for) I’m going to leave my categories open. To conduct this search, I’ll add a few filters, and Product Discovery will show me markets that match what I’m looking for. (And remember, this is simply an example. Feel free to personalize your filters. The more you change, the more unique your results will be).
I’m starting by adding the keyword ‘paper’ to the Keyword Contains field, inputting a minimum monthly revenue of $5000 (to meet my revenue goals), and a maximum review quantity of 100 (to avoid markets that are highly competitive).
One important thing to note is that I’m not providing data for all of the filters. The more specific you are with filters, the more restrictions are placed on your results. I like to start my searches with a few important metrics, then if needed, I’ll start adding additional parameters.
That said, when searching for micro-niches, it’s also important to make sure that there is an audience of people searching for your product (or, existing demand). I might be trying to avoid the heavily competitive markets, but if I’m sourcing a product that no one is looking for, I’m not going to be successful. For this reason, I’m also going to click on the Advanced Filters menu and add a minimum exact search volume of 3,000. This means that I only want to see keywords that 3,000 or more people are searching for each month.
Once I click Show Keywords, my results appear. Each result is a product idea, along with market average metrics, and they all match my inputs. I then filter my search based on star rating to see the best ideas first. The star rating is a 1-5 scale, which is Viral Launch’s initial indicator of the product idea’s potential. This rating is generated programmatically and should be used as a first-check, but it’s crucial for you to dig into the data further and decide if the product is right for your business. Note: The Product Idea Score is only available on annual plans.
From there, I quickly pin five different products that looked interesting to me, and I will analyze each one more thoroughly. Moving over to my pinned ideas page, I have isolated ‘white paper bags’, ‘parchment paper sheets’, ‘white wrapping paper’, ‘gold paper plates’, and ‘crinkle cut paper shred’.
Note: Your pins are unique to search type. For this reason, I will click on the ‘Keywords’ tab within the Pinned Ideas menu.
All of these markets have an average of less than 100 reviews, which indicates a relatively low barrier to entry for a new product. Three of the five have a typical sales trend, which implies that sales have remained relatively constant month over month. Average selling prices are relatively low, which can sometimes be of concern, but assuming that manufacturing and shipping costs are low, my product may still have a healthy margin. These markets also look promising from a revenue perspective, ranging from $7k-$22k per month.
Phase 3: Validate Your Product Ideas
Now that I have decided on a broad market that I’m interested in and have found a few micro-niches to hone in on, it’s time to do a deep dive and identify which products I may want to look into sourcing. I am going to use Market Intelligence, our in-depth Amazon product research tool, to further investigate my potential products.
Step #1: Logical Processing
When deciding on a product to source, your first step after compiling a list of ideas should be to think about them critically. There are a few key questions that you can ask (and answer) based solely on your own intuition. This can be especially important when looking for a micro-niche.
The very concept of a micro-niche focuses on a specific product characteristic in order to circumvent the more competitive primary market. That said, it’s critically important to make sure that people are actually searching within your micro-niche.
You can use a tool like Keyword Research to view the search volume for your keyword, but at a more basic level, putting yourself in a customer’s shoes and asking whether or not you would use this phrase to search for your product can be an indicator as well.
When thinking about your product idea, do any brands come to mind? This can be an important question. If a product market has strong brand awareness (or brand loyalty), it’s going to make it harder to penetrate the market. If you can name some brands, it doesn’t automatically invalidate the idea, but it is something to consider.
For instance, if you’re buying a stapler, you’re likely aware of Swingline, but as long as a stapler staples, has decent reviews, and a low price, chances are most buyers aren’t going to be brand loyal (unless they’re fans of Office Space).
Alternatively, other markets have stronger brand association and loyalty. Even if it’s a dollar or two cheaper, Harvey’s Homemade Toothpaste is going to be fighting a really tough uphill battle against Crest and Colgate. It might be an amazing product and a better value but because most consumers have (hopefully) seen and used a few name brands of toothpaste for most of their lives, it’ll be almost impossible for Harvey to muscle his way to the top of the market.
While I won’t go into all of the possible questions that you could ask in this phase, a few others are:
Do I feel like I can price this product to be competitive and have a wide enough profit margin?
Do I think I can make enough profit per unit for this product to be worth selling?
Am I chasing a fad (where demand may decline before I can get my product to market)?
Am I too passionate or not passionate enough about this product?
Is my intuition telling me anything about this product or market? If so, what will I need to research to reassure myself?
In the Amazon space, some sellers rely heavily on their own gut instinct or personal passions when sourcing. This can sometimes work and it’s important to believe in your product, but other times, if you source something you’re too passionate about, you’re more likely to spend more to improve or customize your product (cutting into your margins) and/or throw good money after bad (by entering a competitive, expensive, or nonexistent market). Other sellers can alternatively get lost in the data, which can lead to lost time, missed opportunities, and a never ending quest for perfection.
I recommend trying to work somewhere in the middle. Use data to hunt out advantageous markets, use your brain to think critically about them, and return to the data to test the products that made the cut.
Step #2: Sales to Review Ratio
First, you want to check out what the sales to review ratio looks like for your pinned products. The sales to review ratio is a measure of how quickly you will be able to compete, as a new seller, in any given market. This is calculated by taking the average monthly sales among top sellers divided by the average number of reviews. If a market has a high sales to review ratio, it means that sales are, on average, much higher than reviews. This signifies that a new product has lots of opportunity to gather reviews, plus there is a low review threshold to reach before shoppers consider that product as a viable option among the other options in the market. Because reviews provide consumer confidence through social proof, and because reviews are not easy to acquire, identifying a market where you won’t need to gather as many initial reviews to become competitive can play to your advantage.
Thinking about this concept logically, certain markets are more review dependent than others. If you’re buying a pair of bluetooth headphones on Amazon, reviews are going to be crucial to your purchasing decision. You want to see opinions on audio quality, battery life, durability, etc. On the other hand, if you’re buying something like wrapping paper, unless the reviews are horrible, you’re probably not going to be as concerned with them. At the end of the day, it’s a roll of printed paper. As long as it meets the stated dimensions and it doesn’t spontaneously combust, it should work to wrap a gift.
Looking at my pinned ideas, the average market-wide sales to review ratio ranges from 16 to 32. This means that on average, products in these markets are generating that number of sales per month for each review. All of these rates are relatively high, which is a good sign. Alternatively, if I’m looking at markets that are generating only 2 sales per review, that might be concerning for me as I’m trying to enter the market.
In the interest of due diligence however, I don’t want to stop there. I’m also going to want to view sales to review ratios on a product-by-product basis within Market Intelligence.
It’s important to note that some noticeable factors can contribute to the sales to review ratio when reviewing at the product level. Whether good or bad, this information can help you to better understand your market.
Here’s the data for ‘crinkle cut paper shred’:
Looking at the individual sales to review ratios for this market, I’m seeing some optimistic information.
Starting with the product highlighted in yellow, the sales to review ratio is below average for the market. That said, looking at the date that the product was listed, I can see that it has been selling for a few years. Because of this, I’m seeing that this product has a higher than average review quantity. It’s actually selling relatively well for the market, however because the price point is above average, there’s a good chance that it’s limiting sales potential.
Checking out the product highlighted in red, I’m seeing a super high sales to review ratio. It’s a newer product with 2 reviews but it’s selling really well. A high sales to review ratio does make sense when a product is newer, if it sells well. For me, this is promising because it provides evidence that I can sell well without having to gather a large quantity of reviews.
While the listing dates in this market prove the contrary, higher sales to review ratios can be a sign of a newer market, which is something to also keep in mind. If you’re looking at sky-high ratios in a newer market, by the time you have a product sourced, those products may have accumulated more reviews, making the landscape more competitive.
Finally, looking at the product highlighted in blue, it has a pretty high sales to review ratio. Looking into this more, I can see that the product has been listed for a little over a year, and despite only having 13 reviews, it’s selling really well for the market. It’s price is relatively low, providing a potential explanation as to why it’s selling well. That said, it’s not the cheapest option.
This product is one to review more specifically. Because it’s not the cheapest option, and because it doesn’t have a wealth of reviews, it may be worth reviewing other aspects that may contribute to this product’s success. Is there a color preference? Is it a larger size? These variables may help inform sourcing decisions.
As a brief comparison, here is the data for ‘bluetooth headphones’:
As you can see, the sales to review ratio in this market is incredibly low. The massive review quantities in comparison to sales would make this market exceptionally difficult to compete within.
Step #3: Sales Depth
It’s important to also observe how sales are divided within the micro-niche. If only 2-3 products are generating 90% of the sales, it’s going to be difficult for you to capture a reasonable share of the market. If sales are relatively divided across the first page (and maybe even the first few pages), it means that you don’t necessarily need to rely on hitting one of the top spots to hit the mark on revenue. It’s much safer to bet that you can rank in the top 10 or top 15. While you obviously want to have the best product in the market, I suggest shooting for the moon, while being okay with hitting the market average.
Using my ‘crinkle cut paper shred’ example, but this time reviewing the sales column, I can see that sales are pretty evenly dispersed throughout the page. This means that even if I’m unable to push to one of the top rankings, I would still have the ability to generate a decent volume of sales.
By comparison, here is another market with a poor depth of sales:
As seen here, there are a few products generating thousands of sales while others are selling in the single digits. In this instance, I know that it’s going to be difficult to compete with the few top sellers.
There are a few different reasons for a poor depth of sales in a market.
It could be that a single brand (or a few brands) dominate the market. This is most common when searching a branded keyword, such as ‘Nike sweatshirt’, but you can also encounter it with non branded keywords with strong brand awareness/loyalty, such as ‘cotton swabs’, where Q-Tip and Johnson & Johnson vastly outsell much of the competition.
This can also happen within private label dominated markets if a handful of sellers have a disproportionately high review count, a much lower price, or a more established product.
Additionally (as is the case in example above), you may not be viewing the primary keyword for a market. This is typically evident if you see large volume sellers in lower positions. If a keyword has a lower search volume, a product with far fewer sales may rank better. This is because it’s able to drive more sales through this specific keyword. However, when looking at a related keyword with higher traffic, the products with high sales volume likely rank better. An example of this would be looking at a keyword like ‘lavender bath bombs’, when the primary keyword is ‘bath bombs’. The keyword ‘lavender bath bombs’ only gets a few hundred searches per month, yet some of the results are selling thousands of units. By comparison, the keyword ‘bath bombs’ receives around 230,000 searches per month.
Step #4: Price & Margin Check
This can be a bit more tricky, but the next step is to try to get a feel for what margins you can expect. You want to look at average prices in the market and compare that to any sort of sourcing estimates you may have found. Market Intelligence can be used to get a rough idea of the profit margin for a product, but it’s definitely important to compare this to any real numbers that you’re able to obtain (quotes for manufacturing, logistics, etc.).
It’s also important to understand Amazon’s FBA and referral fees. FBA fees are based on shipping and storage costs. A referral fee is the cut that Amazon takes for each sale made and is a fixed percentage based on category. Amazon provides a breakdown of their FBA pricing tiers and referral fees by category on Amazon Seller Central.
If you’re looking for more information on calculating FBA fees, we have a blog post that walks through the process in more detail: How to Calculate Your Amazon FBA Fees and Projected Revenue. Additionally, within Market Intelligence, you’re able to view our estimated unit margin for a specific product by clicking on the the orange Unit Margin metric.
As you begin to fill in some of your own costs, Market Intelligence also includes a Cost Calculator to help you determine you own potential margin.
Typically, I like to review the lower prices on page one. If I’m able to turn a profit while pricing on the low end of my competition, I know that I have some flexibility to adapt to market changes. If I can’t afford to source for a competitive price, I may want to avoid this particular market.
Step #5: Check Tips, Warnings, and Alerts
On the VL Analysis tab of Market Intelligence, you’re able to view some quick tips, warnings, and alerts that you may have otherwise missed. This can help to clue you into seasonality, sales depth, review concerns, etc. and can help provide a quick overview of any market conditions that may be of concern.
Step #6: Seasonality
Some sellers choose to steer clear of seasonal markets, while others welcome the influx of cash during peak seasons. Either way, seasonality is something that you want to be aware of when sourcing a product and purchasing inventory. By clicking on the Market Trends tab on Market Intelligence, you’re able to see how a product has sold over the course of a year.
If you’re looking for a seasonal product and you find one that is selling well in winter, you may want to look to source this product in summer/early fall in order to capitalize on the peak selling season. If you’ve missed the seasonal window for the year, it might be worth sourcing a small quantity to start generating a few sales and reviews, or you may want to keep it in your back pocket until next year while keeping a longer term eye on the market.
When looking at a market like ‘Christmas decorations’, you can see that the market is highly seasonal:
Alternatively, while there are always going to be fluctuations in a market, when looking at a market like ‘toothpaste’, the sales spikes are much less dramatic:
As mentioned previously, just because a product is seasonal does not mean that it’s not viable. Sellers can make a killing on seasonal products and only need to be focused on them for a few months out of the year.
The important thing is to understand that sales and demand will not be consistent throughout the year. One of the most common mistakes we’ve seen is a seller deciding to source a product based on statistics obtained during a peak season. Without appreciating the ebb and flow of demand, sellers commonly over order inventory, or financially plan for a high sales volume, only to get stuck holding a large quantity of product.
Step #7: Identify Main Keywords
It’s unlikely that a single search term is driving all of the sales for products in a micro-niche (or any niche for that matter). Typically there are at least 4 or 5 decent keywords that may be viable selling opportunities for a given product.
To start, check out keywords that other products are using in their title. If you’re looking at ‘white paper bags’ for instance, you might also want to check out keywords like ‘paper bags’, ‘white craft bags’, ‘large white paper bags’, and ‘white gift bags’. A sure-fire way to make sure you’re not missing any of your main keywords is to use a tool like Keyword Research, which programmatically identifies all main, related keywords for you.
When using Keyword Research, particularly for micro-niches, I like to first sort by priority score, which will show me the most closely related keywords while factoring in search volume:
One of the most helpful, and perhaps underutilized features of Keyword Research is the ability to add keywords to a bank to create your listing’s copy. This will help you to insure that you’re indexing for as many search terms as possible and casting the widest net to capture your customers. Listing Builder, a feature within Keyword Research, can help you construct your listing and maximize the potential audience for your market.
Proper keyword research can sometimes clue you into an even more advantageous market, but more importantly, you should analyze other main keywords in your market to better understand your micro-niche as a whole. While tedious, it’s valuable to repeat the previous validation steps on several main keywords to fully comprehend your product market and competition.
Without reviewing your broader market, it’s possible to miss crucial data that may help you avoid mistakes. One of the more frequent mistakes we encounter is assuming that a specific keyword is the main sales driver for your product market. If you don’t fully understand your market, you could see a keyword that looks non-competitive with a high return, only to realize that sales are being driven through a much more competitive term.
Let’s apply this to my product ideas:
Thinking critically about my pinned ‘paper’ ideas, I’m going to whittle down a few options.
While I was really intrigued by the low reviews and high sales for ‘crinkle cut paper shred’, with an average selling price of $11 per unit, I think I might avoid this market. I know that in order to be competitive, I’m going to want to be able to price on the lower end, meaning that I’d probably be looking at a selling price of around $8-10. Even if I can source affordably, shipping, fees, and storage are likely going to eat up a lot of my potential profit margin.
Next, I’m going to weed out the ‘parchment paper sheets’. The overall numbers aren’t bad but looking at Market Intelligence, I’m noticing some larger names like Reynolds. While Reynolds is providing some steep competition, I’m honestly surprised by how evenly the sales are spread.
That said, I’m also starting to think about manufacturing. Parchment paper typically involves more robust (and likely more expensive) packaging. Typically, it would be packaged as a roll, in a box, with a metal cutting edge. This will also add weight which will increase the cost of logistics. Since average selling price isn’t too high here either, every penny counts.
Finally, and while it may still be a decent idea, I’m going to filter out ‘white paper bags’ as well. This is mainly because I’m not overly confident in how many sales this specific keyword generates. There is a lot of variety on size, intended use, and even features (handles, gloss coating, etc.). This means that it will be hard to determine whether the keyword ‘white paper bags’ is a primary keyword for my market and it will be hard to determine which product features will make me more competitive. In comparison to many products, this is a relatively minor point, and while you should definitely perform quality control inspections when sourcing a product, I’m also a little concerned about glue quality and weight capacity. Compared to wrapping paper or paper plates, I’m seeing slightly more potential for returns and negative reviews which could limit my potential for success.
For the sake of keeping this brief (as brief as possible), I’m going to focus on the white wrapping paper.
Looking at Market Intelligence, price points are relatively high, sales are pretty well dispersed, and the product is relatively simple.
While there is a bit of seasonality to the market, there’s still an overall average of around 500+ sales per month and sales don’t totally drop off outside of peak season. The best selling month isn’t until November, but this will give me a bit of time to source and list my product and work on accumulating reviews.
There are also no warnings or alerts for the market, which is another positive sign.
In comparison, with the ‘gold paper plates,’ one of my major concerns is the diversity of product offerings. On page one, I saw everything from gold plastic utensils to gold and pink plates, different shapes, sizes, and patterns. This will make it harder to isolate the features that buyers prefer and would likely result in lower conversion rates.
Fortunately for my bottom line, it appears that plain white paper rolls sell best. Provided I can offer a comparable size and length as the top competition, while pricing my product at around $15 per unit, this should be a pretty viable option.
White wrapping paper receives around 7,000 searches per month, meaning that it has an audience searching for this product. For products on page one, there is an average sales quantity of 810.46 units/month with an average revenue of $17,665.04 meaning that it definitely has the potential to hit my revenue goals.
The average review count for page one listings is 55.15, however there are several products with fewer reviews that still sell well (implying that, while I will ideally want to generate as many reviews as possible, it’s not necessarily crucial to have as many reviews as my lead competition to be successful). As long as I’m able to generate 10-20 reviews with a rating of around 4.5 stars, it should give me a healthy foundation for driving sales.
It’s important to note that I am running this analysis shortly after Christmas so numbers are likely to be inflated. That said, based on the annual sales trends, I can still expect a decent potential year-round. This means that I should be looking to ramp up my inventory and marketing in time for Q4, but I should still have decent selling opportunity when my inventory hits Amazon. This ebb and flow of the market may actually be ideal for me, as I can source the product now and begin generating sales and reviews with the goal of positioning my listing to capitalize on Q4.
At this stage, white wrapping paper appears to be a solid product idea, and I was able to find this micro-niche within about 10 minutes of research on Product Discovery.
Phase 4: Source Your Product
Once you’ve identified a product (or products) that you’re interested in selling, it’s time to find a manufacturer.
You can go to trade shows, take a trip to China, or contact a sourcing agent, but the quickest and most cost-effective way (and where most sellers end up finding a supplier) is typically using Alibaba. Alibaba is essentially the e-commerce platform for e-commerce businesses; the Amazon for Amazon sellers. This database of manufacturers helps align you with suppliers that will able to actually produce your products.
Looking at my micro-niche for white wrapping paper, I was quickly able to find several suppliers with a simple search:
You may have to experiment with keywords and search around a bit, but you can find virtually anything on Alibaba. And, suppliers are typically willing to negotiate and manufacture to your specifications.
From here, I would select a around 5 suppliers who look to be reputable and reach out to them inquiring about samples. I won’t delve too deep into the sourcing process here, but I’ll want to compare pricing, product quality, and adaptability of the supplier as well as timeliness, communication, and the overall pleasantness of the conversation. Keep in mind that if all goes well, I’m looking to build a long-term business relationship with this supplier.
When looking for a product within a micro-niche, it’s important to consider the competition when making a sourcing decision. With my white wrapping paper, I’ll want to see if there are any discernible features that sell better than others. What sizes, thickness, potential patterns, etc. are ideal for capturing my market and gathering high quality reviews? Returning to Market Intelligence, I can review products that sell well in the market and take note of any shared traits.
This will help me to understand whether I need to order a few different sizes, or whether I should source rolls or sheets. I can also see if offering a patterned paper improves my sales potential, or if there is a certain thickness that buyers seem to prefer. Obviously, this has to be reviewed with attention paid to other variables such as price and review count, but understanding what your customers want will help you to source a product that fits your demand.
Using another example, let’s say I settled on white paper bags as my micro-niche. Through this lens, I would want to check to see if bags with handles and/or gloss coats sell better. I’d also want to check what quantities (how many bags in a package), and what dimensions sell best. Using this information, I can source a product that conforms to, and capitalizes on, the majority of the micro-niche demand.
As the Amazon landscape continues to grow and change, it’s important that your strategy does as well. The days of sourcing a gold-mine product that generate hundreds of thousands (if not millions) of dollars is all but gone; but the opportunity to be successful on Amazon remains strong.
Rather than looking for one big, broad product market, fueled by a small handful of high-volume search terms, it’s now more advantageous to look small and think big.
As competition grows, Amazon’s dominance over e-commerce grows as well. While established sellers have the benefit of experience, sales history, massive review quantities, and large investments, the continued growth in sales creates more depth to the market and creates opportunities in more specific micro-niches.
These days, it’s no easy task to quickly drive a product to a monthly revenue of $50,000. Instead, it’s more advantageous to use micro-niches to drive 3-4 more specific products to a monthly revenue of $5,000-$15,000 each, allowing you to strategically grow your business.
The secret to success on Amazon in its current stage is to think smarter, dig deeper into research, source with specificity, and diversify your offering.
In order to take advantage of the incredible gold rush happening on Amazon, you need a great product to sell. And in order to find a great product, you need a rock solid sourcing strategy. This episode is all about the what a successful sourcing process looks like and how to find a product to sell on Amazon.
The first thing you need to do before you begin your search for profitable products is set your goals. Look at a few products whose performance you want to emulate, and look at the calculated upfront cost using our FBA Calculator to determine what is realistic for you and your budget.
Can’t think of any good product ideas? Look for inspiration online, browsing sites like Pinterest, Fancy, or Wanelo, or use a tool like Product Discovery that will do the heavy lifting for you and save you time.
Make sure you do your due diligence and perform some market research before committing to a product. Our market research tool, Market Intelligence provides up to 2 years of historical data so you can look at sales, price, and review trends.
Hey, guys. Just to give a heads up, this episode is targeted to our more beginner-level sellers. In order to take advantage of the incredible gold rush happening on Amazon, you need a great product to sell.
But sourcing the wrong product can be worse for your business than not selling at all. In order to turn a profit you need a rock-solid sourcing strategy. I’m Cameron Yoder.
And I’m Casey Gauss, your host for Follow the Data: Your Journey to Amazon FBA Success. In this show we leverage the data we’ve accumulated at Viral Launch from over 25,000 product launches and our experience working with 6500 brands to help you understand the big picture when it comes to Amazon and, more importantly, the best practices for success as an Amazon seller.
We’re embarking on a brand-new series about sourcing, a pillar of success for any Amazon business. In order to compete with growing competition you need a high-opportunity market and a quality product at the right price. This specific episode is a little more geared towards beginners. However, our next couple episodes dive deeper into mid- to high-level content.
On today’s episode we’ll talk about how to set realistic goals based on the capital you have to invest, how together a wide variety of potential product ideas, how to ensure that your product is in a good market and finally, how to determine which products are right for you and your business.
Casey, I love topics like this because even though it’s so simple, I – and even though this is geared towards beginners, I think there is value in this for anybody to, again, just take a seat, think about where you are, where you were and where you want to be and to think about and write out your goals for where you want to go.
Yeah, you know, I imagine we’ve said this before, but probably the number one reason we see sellers fail is because they are jumping into the wrong product markets, or they make bad sourcing decisions. And so kind of the intention with this series is to help steer people away from that.
So yeah, so let’s jump in. First we want to talk about setting your goals. First, let’s talk about kind of where people go wrong here. So I think the easiest place to, or the easiest way to identify it is, you know, really at the end of the day people would just go and see, hey, I know people are making money with this product. I am going to source it. End of the story. You know, they’re not taking into account, okay, how much money do I have to invest? How much money am I hoping to make? How arduous is that process going to be of taking my product from conception to getting to that level of success that I’m seeing other people get? You know, they’re not asking all these questions, and these questions are absolutely vital to having success, or at least having the expectations set appropriately so that you, you’re able to achieve them.
So you know, our lead developer, he always says that reality is your expectations versus what really happens, and so if you get into a market expecting to make $50,000 a month because you see other people doing it but you only make $10,000 a month, well, you’re probably not going to be very happy. But had you have expected to make, you know, $8,000-$10,000 a month and you’re making $10,000, well you’re going to be really excited about that.
You kind of outlined the goalsetting aspect, right? One of those first questions that really helps people along the right path is how much money do you have to invest? Really you’re taking a seat and you’re looking at okay, if I’m looking to get into fidget spinners, do I have enough money to get into this market?
Yeah, so too often we see, you know, sellers are trying to buy as much – they’re maxing out their budget for this Amazon business in their inventory. And so basically – and this is a big problem, right? So let’s say you have a $5,000 budget. Well, these – a lot of sellers will go and spend up to $5,000 on inventory and getting it into Amazon. What they don’t account for is well, now that’s just, you know, a tenth of the battle. That’s the easy part of the battle I’d like to think. The rest is how do I – or I’m going to have to spend money on marketing materials, you know, a la product photography, getting your listing written, keyword research, some software tools around helping you get up and going and optimized, and then marketing to get that product ranking. You’re going to have to, at the very least, be spending money on sponsored ads or some form of marketing to get your product, you know, in front of people.
And so if you’re spending all of your budget or close to, you’re going to have a very difficult time getting that up and going. So you know if you have a $5,000 budget, and you need to be very honest with yourself about this, but yeah, let’s say you have a $5,000 budget. You need to be allotting a lot of that budget to marketing expenses. And so maybe spend half of your available capital on inventory. You really need to look at the numbers. You need to look at the market and be honest. You know, what is the barrier to entry? How much does each widget cost? What are the fees associated with each sale? And you know, how many units do I need to purchase in order to be able to be somewhat aggressive in order to have enough stock? Let’s assume things go well and you’re selling 1000 units a month, and it takes at least 60 days from the time I placed an order until the time it’s in FBA. Are you going to be able to have enough inventory to pay for, you know, 70 days of sales? These are all questions that you need to, you know, be asking yourself.
Casey, let’s say – let’s say someone’s coming in with $5,000.
What qualities should they be looking for in a market if they’re just getting into a market for the first time and they have like that $5,000? What should they be looking for?
So don’t be looking at those markets, or at least not right now, don’t look at those markets where you know you’re hoping to make $50,000 a month because, you know, you’re going to need $20,000 of inventory. You know, you’re going to need a significant amount of money to invest, right, or at least, you know, significant in this example. Anyways, so you know, look for those markets where your potential is $5,000 to $10,000 a month, maybe a little bit more. But you really need to make sure that the barrier to entry is low because with $5,000 you don’t have a ton of budget for marketing. So again, if you spend $3,000 on inventory, well, that allots you $2,000 to get some professional photos done, maybe get a keyword tool or two to help maybe have you write the listing. And then you have to have a good budget for sponsored ads. You have to have a good budget for marketing for running giveaways or however you’re planning on getting this product ranking. But that’s even for a small market where the opportunity is $5,000 to $10,000.
And a lot of people like to kind of steer away from these markets because it’s not as sexy. Everyone wants to get into the markets where, you know, I can make $100,000 a month, or you know, these guys are just making insane amount of money on this one product. But you know, in reality those are very vicious markets. If it’s not vicious yet it will be very soon. So I am actually a big fan of these, you know, unsexy markets where I’m only making $5,000, $10,000 a month but you just go really wide and you get into 10 of those markets. The barrier to entry is generally low, or make sure that it is. You’re not spending a lot of time or resources fighting competition. You just get in, you dominate pretty easily and you just move on to the next one, and you know, you line up 10 of those markets, and now you’re doing $100,000 a month. Now you have a million-dollar business.
As you said before, expectation versus reality. It’s really easy to look at those, to watch those YouTube videos or those articles that talk about oh, hey, I made $1 million on Amazon with X product and think oh, this guy is making $1 million a year selling one thing, where I mean that’s, that shouldn’t necessarily be your expectation going into Amazon selling.
Yeah. Cool, so yeah, next, looking – you need to set realistic expectations for how much money you’re hoping to make. Again, make sure you’re considering the net as well because it’s very easy to not pay attention to margin and get into a product where, you know, you’re selling a lot of inventory but you’re doing it at a very low cost just to drive traffic and you’re not actually making any money to reinvest. And so that is very important. Make sure you’re paying attention to margins. You know, a lot of people like to kind of throw out these numbers around you should look for this margin versus this margin. You know, as long as you’re thinking of the long-term strategy I’m actually an advocate of being open to any kind of margin. If you’re excited about $0.10 on the product but you’re doing just an insane amount of volume, or this is helping you play into some bigger narrative around, you know, I’m using my Amazon traffic to fund my, I don’t know, outside business – I don’t know, but anyways, I think there are scenarios in which case all margins work so long as you’re being very cognizant of what is going on. If you’re not aware that $0.10 of margin per unit sold is not very good, well now you’re in trouble. So a really take a look at that. You know the nice thing here is that you kind of get to control everything here, so if you are looking for a product where the margin is X, those markets exist. You just have to be willing to put in the time to find it. And we’ll talk a little bit more about that later.
This is if – if step one in setting your goals is asking yourself the question how much money do I have to invest, then this would be a comparable step two in asking yourself okay, now that I’ve established how much money I have to invest, now how much money do I hope to make, right? And with this you’re looking at the long-term market, the long-term market trends, I guess, that really help paint that picture. You’re also asking yourself in this, in the question of how much money do I hope to make, you’re asking yourself okay, are my goals realistic based on the amount of money that I have to invest?
You also need to look at kind of what the end goal is here, right? So am I just trying to cash flow and make a bunch, you know, as much money as possible as easily as possible? Well, the answer there is you may want to just go and pick out all these great diamonds in the rough, all these opportunities. So hey, this product in beauty, I could profit $10,000 a month if I get into it pretty easily. Competition isn’t very high, so I’ll source this. And then next thing you know there’s something in pets where you can do the same, and then in health and household, and then in automotive.
And so I’ve seen people be really successful here. I’ve not seen a successful exit of a product line like this. Part of the reason being is not because people are not interested in them. It’s because I don’t know as many lines that are doing this. But you know the biggest seller that I know doing this, they’re doing around $30 million a year, and they’re just sourcing everything that has high opportunity for them. And so it’s working very well from a total revenue perspective. Could they easily sell? To the right, you know, private equity firm, for sure. But I think it’s not as easy, and your multiple will be lower. The areas where I’ve seen the highest multiples on brands that sell, let’s say that, you know, this is your end goal. Well, then you want to build a cohesive line of products, in which case you need to not just be looking at one particular product, but you should probably go line up at least a few that you know have good opportunity for you to get in there, the barrier to entry is not too high, competition is not, you know, insane, and you can go start with product one and then go to product two, product three. You have a decent kind of roadmap ahead of you. And this will really, again, kind of dictate where you get started as well as where you are going.
And then kind of the last thing is how much time are you looking to invest? You know, do you have another job? Is this a side hustle, just something you’re just, you know, doing on the weekends or whatever? Or are you looking to replace your full-time job and dive all the way into this? Or are you full-time here, in which case that will kind of dictate, you know, the products that you get into. And you know, ideally just because opportunity cost is so high, meaning that, you know, for every dollar you’re investing right now in your Amazon business you’re getting $10 back, you know, let’s just say, versus, you know, in some other market, some other opportunity you’re investing a dollar, and maybe you’re getting two, three dollars back. The opportunity is just so high in Amazon that spending time doing other things or wasting time doing this is just not worth it. And so you should always be looking for those products where the 80/20 rule easily applies. So what’s 20% of the work that’s going to get me 80% of the results? Move on, you know? Go to the next product. Do the 20% of work, get 80% of the results, and then, you know, move on to that.
It’s also really important to ask yourself how much risk you’re willing to take or you’re able to take right now. Like if you have a family or if you have other people to take care of, then how much time can you put into this, and how much time are you willing to invest? And how much risk are you willing to take? Those are all super important questions.
Just because you have $1 million of free cash laying around – one, hit me up. No, I’m just kidding. But you know, you shouldn’t just dive all the way in. I think that you should dip your toe into the water, understand kind of the marketplace, how everything works, what are market dynamics, and then start to iterate from there. Once you really figure it out, okay now let’s start investing more money.
So we talked about setting goals, the question of how much money do you have to invest, how much money you do you hope to make, building a product, a cohesive product line, and how much time you’re looking to invest. Now we’re going to dive into specifically finding product ideas.
Yeah, so this is something that we’re becoming more and more passionate about. I think a great place to start, although I have a counterpoint to this, is just looking at products that you’re passionate about, right? Like you understand those markets better than anybody. You can stay on top of trends, which are great opportunities to really build a business. But yeah, look at markets or, you know, products that you’re very familiar with. I will say that counter to that, generally we see the people that are the most successful are people that are actually not very passionate about the markets that they’re in, and the reason being is a lot of the time the people that are passionate about this, they make emotional decisions. And so it’s the emotional decisions that can, you know, sometimes lead to bad decisions or less profitable decisions. The guys that have the most success or, you know, the individuals, men or women, that have the most success are those that are not particularly passionate about their products. They just really understand how to identify great market opportunities. They know how to pull the levers to success when it comes to Amazon, and they’re just able to, you know, really, really push forward.
I think I can offer a unique perspective on this actually. So back in high school I did something called retail arbitrage, okay? So I would, back then I would go to Goodwill or just other stores in general, buy something for super low and then flip it on eBay, of all places. EBay and Amazon, actually. And during this time when I was getting started developing this a little bit more it really just helped pay for some stuff in high school and helped pay a little bit my way through college, but I got some really good advice as I was just starting to get into everything with flipping online, and it was someone who had been doing it for a little while, doing retail arbitrage, and he told me hey, Cam, just as you’re starting out look into the things that you’re passionate about. They might not be the best things to sell, but because you’re passionate about them you will be more interested and will not lose your interest as quickly as you might be if you’re not as passionate about it.
And so, Casey, everything you said I 100% agree with. I do think, though, that there is something that holds your attention more about if you’re just looking into markets and you’re looking at what it means to sell on Amazon or if you’re looking into products that you might want to source, looking into categories that you are passionate about or is going to help really get you in. Now it’s important to understand then what makes a good market, what separates a good market from a bad one because if you’re passionate about a market it doesn’t necessarily mean that it’s going to be a healthy one to get into or one that’s going to really help you make a lot of money if that’s what you’re wanting to do.
Yeah, no, I think that’s a good point. Cool, so, and you know another way is if you have a manufacturer or are aware of manufacturers, or you can go find manufacturers on sites like Alibaba, hit these guys up. Ask them for their product catalog and just see what they offer.
You can find their product catalog online. You could just to go to their product page and look through their whole list of what they offer.
Oh, well there you go. So and this is not necessarily a plug for Viral Launch, but whatever. One great way to kind of just sift through those catalogs really easily is you can do it yourself or have a virtual assistant. Just go take those product ideas, plug them into Market Intelligence, which is, you know, our market analytics tool, and you can see oh, this is a four-star idea, five-star idea, one-star idea. If you have a great rating okay, now I know that I need to look more into this market or those stats. You can just really cruise through and amass, you know, a good potential products idea pretty quickly.
Literally, so browsing other internet sites, like if you just even check Pinterest, or if you check Instagram, basically keeping your mind’s eye open to okay, when I see a product look it up on Amazon. Look it up on a research market tool, Market Intelligence, right? So even if you’re walking through the store, just be in a mentality, a mentality mode of hey, I’m going to write down this list of products that I never thought would be successful to sell on Amazon, and I’m going to check out the market just to see what it’s like. That’s just helping you expand your mindset on what is even possible to sell on Amazon.
Yeah, and another thing, there’s other tools. You know we have one launching here really soon. Again, not so much a plug, but just an opportunity. We have a tool called Product Discovery. Jungle Scout also has a tool that allows you – you know, we’re tracking tens of millions of products, both of us, and basically you’re able to filter these, you know, massive Amazon product catalogs based on, you know, what you’re looking for. So you know, I’m looking for a product that is doing at least $20,000 a month in this category and is fulfilled by Amazon, or merchants or whatever. Yeah, and then we’ll just show you. Hey, here are thousands, or tens of thousands, or maybe 20 products that all fit your criteria. Hey, you know here’s maybe the starting. You can look further into this. Basically it’s just a shortcut to kind of sifting through Amazon data to understand what’s working and what’s not. Is it always the best? No, I think that there is no necessarily best answer. Just whatever works best for you is kind of that answer. I think it’s worth, you know, trying out pretty much all of these just to, again, to get a taste for yourself, and depending on what market you’re looking to get into or are already into, the more opportunity to find something good.
So we’re talking about, again, this whole series is about sourcing in general, and we’ve gone through goals. We talked through finding a product idea. The next comparable step would be to look further into those markets, to narrow down your product ideas.
Yeah, so we call this the validation stage.
Right, right, yeah, validation. Casey, what should people look for when they’re looking to narrow down their search in this way?
Yeah, you know, I think we’ve kind of talked on some of these points a little bit in other podcasts, but really –
Just like a broad, I guess –
Yeah, yeah, so just a quick overview. You know, we want to look at market potential. So don’t look at any one particular ASIN in a market and expect to replicate that ASIN’s success. You should be looking, you know, at the averages or high averages of a particular market. And when I mean market I’m talking about a, you know, the products that are ranking for a particular keyword. So let’s take grill brush as an example. Please do not source grill brushes.
Don’t do it.
Yeah, I know. Anyways, so search grill brush. Of the top, you know, 20-some products, fifty products or whatever, preferably you know really page one to be honest, but anyways, what are the average monthly sales? And those of the kinds of numbers that you should be expecting, not what is the top seller or the highest volume seller doing? Don’t expect that. Again, it’s all expectations versus reality, and we want to help you set your expectations appropriately. Next is kind of the barrier to entry, and we think of reviews as kind of being that barrier to entry, like we’ve talked about before, so really we look at this thing. Should be called reviews to sales ratio. We call it sales to review ratio because it kind of flows a little bit better, but anyways, really what this is is a calculation of potential versus, you know, how much work am I going to have to put in to get there? So you know, on average let’s just say on page one if all the sellers were selling 1000 units a month but they had 1000 reviews, that would be a sales to review ratio of one, meaning like that’s not that great, but it’s not too bad, versus a market where everybody had 100 reviews and they’re selling 1000 units a month. That’s a sales review ratio of 10, and that just means like you don’t need to gain as many reviews in order to sell at market potential, which you know, is more opportunity for you to get in quicker, hit market potential, easier and kind of move on to the next product.
What about red flags? What should people – what are some red flags that really pop up?
Yeah, so if Amazon is kind of dominating the market, so you know if, you know, 40%, 50% to 70% of the listings are all sold by Amazon, generally that could be a red flag, meaning it’s going to be more difficult to compete against these listings, or there’s a reason why Amazon is selling them. Again, looking at brand names so it doesn’t matter who is selling them, but again, if a significant share of the market is held by these brand-name players then there’s probably a reason for that, meaning that there’s a chance that people are buying these products for a particular reason from brands. So there are products where – maybe it’s diapers or whatever, bottles or I don’t know, something where people want these brand names to be their manufacturer.
So okay, we talked about goals. We talked about finding a product idea, validating your product idea. Another aspect is contacting – and the next step, I guess, would be contacting a manufacturer, right? And so finding a manufacturer is actually a huge aspect of sourcing. We’re going to have a full episode for you next week all about it. I go in depth with a very high-level seller about his experience with manufacturers from finding a good partner to negotiating from low-level strategy to high-level strategy. No matter where you are, no matter where you’re at in the process I think you’ll find something useful in our conversation.
Well, that is all that we have for this week. Thank you so much for joining us on Follow the Data. Join us next week for that manufacturing episode. For more insight and reliable strategies for taking your Amazon business to the next level, subscribe to the podcast and check out the Viral Launch blog at viral-launch.com.
Don’t forget to leave us a review on iTunes. Your feedback helps us reach new listeners and is super helpful as we develop the show. Huge thanks to those who have already written reviews, as well as called in and left us a voicemail. It’s super exciting to see your enthusiasm for what we’re doing, and we can’t wait to bring you more valuable content.
Thank you again so much for listening. And if you want to be featured on the show feel free to leave us a voicemail and tell us your thoughts on today’s episode, or ask us your Amazon questions. Our number is 317-721-6590. Until next time, remember, the data is out there.
Viral Launch CEO, Casey Gauss, and Amazon Seller Coach Cameron Yoder bring data-driven insights to the Seller community in their weekly discussions.
On the show you’ll get the latest Amazon selling strategies and best practices based on the company’s experience launching over 22,000 products and working with over 5,500 brands. Casey and Cam will bring you up to speed on the latest Amazon news, share stories of success and failure, explore the difficulties of entrepreneurship, and discuss the way Amazon is changing retail.
At the center of the show is the Viral Launch commitment to offering reliable information to today’s entrepreneurs.
Finding a great product to sell on Amazon can be tough, but with so much riding on your sourcing decision, you have to make sure you get it right.
Maybe you’ve been selling on Amazon for a while and are looking to add a new product to your arsenal. Or maybe you’re new to the selling game and just aren’t sure what type of product would perform well or need help generating ideas.
You could spend hours upon hours combing through Amazon to compile messy spreadsheets full of mediocre product ideas. Or, you could tap into Viral Launch’s unrivaled matrix of high-quality data points to quickly identify products that meet your exact specifications.
Introducing Product Discovery by Viral Launch: the best and most precise Amazon product finder in the galaxy, helping you uncover the most profitable Amazon product ideas.
Whether you’re an experienced seller or are just jumping into the game, Product Discovery is designed to help sellers at every level comb through the millions of potential products you could sell and determine which ones you should sell.
Product Discovery is a data-driven solution to finding Amazon products. Developed with Amazon sellers in mind, Product Discovery isn’t your ordinary product finder. With Product Discovery, there are four different ways to find exactly what you’re looking for. Search by Product, Keyword, Brand, and Category. Whether you want to find specific products that meet your criteria, potential keyword niches, successful brands you want to emulate, or subcategories full of up-and-coming products, you’ve come to the right place.
Let’s take a walk through the unique features of the tool, and get you on track to sourcing your next profitable product.
If you’ve used a product finder before, you’re likely familiar with searching by product. This method is actually not the most effective way to discover product ideas. In fact, we recommend staying away from Product Search for idea generation.
It may seem more direct, but you lose out on the holistic view of the market by only looking at one specific ASIN. Making a sourcing decision based on one product is dangerous because you have no idea what that seller is doing to achieve that success. Maybe they’re Facebook ad gurus, or maybe they’re always running a promotion … you just don’t know. It’s much more advantageous to look for keywords and research the market in its entirety so that you can see all the products you will compete with and better gauge your likelihood of success.
We do include Product Search as an option for sellers who are already comfortable with the search method, but if you’re wanting to make a confident sourcing decision, we highly recommend using our Keyword Search instead.
So let’s go through Product Search. Say you’re already selling a variety of baby products and want to stick to that category. You’re looking for a product with high growth and high profitability – so up-and-coming products with healthy margins. Select Baby from the category list, plug your desired ranges into the filter slots, and Product Discovery will pull up a list of products that meet your exact criteria:
The top products that meet your criteria will be listed, along with their brand name, fulfillment method, BSR, monthly sales, revenue and profit (after fees), price, rating and number of reviews, and the number of sellers on this listing. You can sort the results by any one of the above features, so whether you’re looking for a product with high BSR or a low number of reviews, you can see those first with the simple click of a button.
Other features include a button to view the product on Amazon and a Market Intelligence button so you can quickly get started on market research for that particular product by researching its main search terms. You also have the option to download the search results as a CSV by clicking the download button in the top right corner. If you find a product you want to keep your eye on, you can “pin” that product to your Pinned Ideas board to track and monitor.
Right next to the CSV button is the option to view advanced data. Toggle on to reveal more unique criteria for each product, including how the product is performing now compared to how it has performed historically and how quickly the product is gathering reviews.
If you want to narrow your list of product results even further, Product Discovery offers advanced filters, including estimated initial investment cost and profit, average profit margins, best sales period, current sales pattern, sales to review ratio and more. Our advanced filters allow you to customize your search criteria and generate a list of products that meet your exact investment and sales goals.
To get a broader view of how the market is performing, including your potential competition, we highly recommend our next search option: Keyword.
While Product Search allows you to hone in on individual products that meet your criteria, Keyword Search takes a step back and views the market from a broader scope. Rather than zeroing in on a particular ASIN, Keyword Search considers the top products for a specific search term or phrase and averages the growth (or decline).
If you’re newer to the Amazon game or are looking for a straightforward approach to finding your next profitable product, we recommend starting in the Keyword Search tab.
The basic filter options are fairly similar to those under Product Search, except that the monthly revenue, sales, price, and review count are averages since your results will consider multiple products.
We’ll go ahead and stick with the baby category for this tutorial, but once you’ve input all your desired filters, Product Discovery will provide the top keyword phrases that meet your criteria. The results shown will look slightly different than your product search results.
You’ll see average price and profit margin, average monthly sales, average number of reviews (and rate), average monthly revenue, and the sales to review ratio for the top products under that particular keyword. If you want to sort your results by any listed data point, just click on the arrow next to the column title, and you can see results from the highest to lowest number of reviews, lowest to highest sales and more.
A unique and extremely helpful feature under the keyword search results is the Idea Score. The Product Idea Score is only available if you subscribe to one of our annual plans. This is an extremely beneficial metric because you are able to sort by Star Rating. For those of you who have used our product research tool, Market Intelligence, you know the Idea Score is our rating system for profitable ideas based on our ever-expanding network of data.
5-Star Ideas are markets that we’ve determined likely have great potential, through our custom, complex, in-house rating algorithm. A 1-Star Idea is one that we recommend staying away from due to any number of factors, including but not limited to: high barrier to entry, high competition, declining trends, etc. With an annual subscription to Product Discovery, the ability to sort by Idea Score provides a quick and effortless way to see the best products first. Once you’ve filtered for markets that fit your goals, sort by Idea Score to see the markets that Viral Launch quickly and easily verifies for you! Then, dig into the market with Market Intelligence to make sure the market data aligns with what you’re looking for.
Clicking on the advanced data button for your keyword results will reveal some similar data, such as the price change in the last 90 days, the sales change in the last 90 days, the review change and review rate. Unique data points to this search type include the sales percentage year over year, the current sales pattern (declining, typical, seasonal or up and coming), and the best sales period (month) if applicable.
Advanced filters are offered under keyword search as well, so you can get as specific as you want and find some killer, profitable keywords. And once you’ve found them, you can pin your favorites, view them on Amazon and in Market Intelligence, or download the results as a CSV.
You might be thinking … product and keyword search are great, but I’m already selling and I’d love to be able to track the top brands in my category, monitor their success, or spy on top-selling brands in other categories to potentially replicate their successes …
We’re one step ahead of you. We created our Brand Search option as a unique way to check out specific brand names, their products, sales, revenue, reviews and more. You can also easily find killer products to source by checking out the brand’s top selling products in their Full Scan page. We’ll talk more about that page later.
Whether you’re a new seller trying to navigate the ins and outs of a profitable brand in a specific category or you’re a more experienced seller looking to monitor the top competitors in your space, our Brand Search has just the criteria to help you identify the brands you want to watch or emulate.
When you’re tracking a brand, you probably want to know their success level and growth rate right? That’s what we thought.
In Brand Search, you can filter for brands that are in the top 25%, top 5% or top 1% in a category and have growth rates anywhere from slow to insane mode. You can also set quantities for the brand’s monthly sales or revenue, total or average review count, average price and more. Your results will include data from across all their products, whether they have 1 or 10,000.
For advanced Brand Search filters, you’ll see some similar options such as average profit margin, sales year over year, best sales period, sales pattern, sales to review ratio, and price, review and sales change in the last 90 days.
There are 3 new advanced filters you’ll see in Brand Search: Quick Win, Moderate Win and High Upside Products. These metrics allow you to set ranges for the number of each “type” of product from that brand. Quick Win products may be easy to replicate but have lower revenue streams. High Upside products are more difficult to replicate but generate more revenue. Moderate Win products are somewhere in the middle.
Once you’ve set all your desired parameters, hit view filter results and start discovering the brands you want to keep your eye on and the products that are driving their success.
Your results will display some familiar options like the “view on Amazon”, “pin” and “download as a CSV” buttons. If you’re searching for advanced data in Brand Search, click on the Source logo and you will be taken to a new page featuring a Full Scan of data detailing the brand’s sales, trends and more. This Full Scan page is loaded with information for you to really dig into the brand, including their top products.
On the main results page, you will also see the number of products the brand has, their monthly sales and revenue, average price, number of reviews and their success (compared to top competitors) and growth (based on recent sales data). If you want to sort your results by one of these metrics, simply click the arrow next to the column title.
Our final search option is by Category. This is the most wide-lensed way to find a product but can be highly effective once you get the hang of the search criteria. Whether you’re looking for a niche product within your current market or just a niche subcategory that hasn’t been tapped into yet, Category Search is the way to go.
Category Search comes with a higher learning curve, as it’s something that many sellers will be unfamiliar with. However, this search method can prove to be an advanced seller’s best friend with the countless avenues provided to arriving at profitable products.
When you take a look at the filter options in Category, you’ll notice two newbies: Opportunity Score and Maturity Score. We created these two scores to simplify the process of finding the categories you’re looking for. Opportunity score is a way to determine the number of “good opportunity” products within a specific subcategory, so a lower score will yield subcategories with a smaller number of “good opportunity” products and vice versa for a higher score. Maturity score allows you to filter based on how mature, or established, the subcategory is, so a high maturity score yields subcategories that may be more difficult to enter and have a lower ROI initially, and vice versa for subcategories with a low maturity score.
Other basic filters for Category include average price, average monthly sales in units, average review count, sales to review ratio and more.
The advanced filters for Category Search are similar to the other three categories, including the Quick Win, Moderate Win and High Upside product ranges from Brand Search. Three advanced filter options unique to category Search are Number of Products, Unique Brands, and Name Brand Market Share. Although they are fairly self-explanatory, number of products allows you to set a range for the amount of active products in that category, unique brands lets you set a range for the number of brands selling in that category and name brand market share allows you to determine what percentage of that category is dominated by name brands.
Once you’ve set all the filters to meet your criteria, your results will provide the monthly sales and revenue, number of reviews, average price and number of brands across that subcategory. You will also see the opportunity and maturity scores, which are color-coded to help you determine the right combination to meet your criteria (red = “bad” or low, yellow = moderate, green = “good” or high).
Other options you’ll recognize are the download, pin, view on Amazon and Source buttons. Similar to Brand Search, clicking on the Source logo will take you to a Full Scan page for that subcategory detailing a variety of data-driven metrics, from sales and review data to the top products within that subcategory. Again, the Full Scan page will break down some of the overview metrics you see in the result list, as well as identify some additional in-depth metrics. And, don’t forget that you can sort the results by any one of the desired filters by clicking the up or down arrow next to the category title.
Now that we’ve taken you through each of the four main search options, we wanted to point out a couple more unique features of our product finder.
In the top right corner, you’ll see a category drop down bar, which allows you to drill down from top-level categories into subcategories, similar to how you would on Amazon. When you click the blue scan button next to any category or subcategory, you will be taken to a Full Scan page with detailed information and data about that category. This feature is a quick and efficient way to check out our Full Scan pages if you know the category or subcategory you are looking for or just want to browse.
The final, helpful feature of our product database is the Pinned Ideas tab. Remember how you can pin your favorite products, keywords, brands or subcategories in each of the search options? To check out all those pins, hop on over to the left sidebar and click on the Pinned Ideas tab under Product Discovery. Here you will find everything you’ve saved so you can once again see all the information, check the idea out on Amazon, or continue researching the idea with Market Intelligence. And, if you no longer want to monitor a pin or want to make room for more, just click the remove icon to get rid of it.
So Why Product Discovery?
We know we aren’t the only product idea software on the market, so why choose us? Sure, we might be biased, but here’s a few reasons why we think you should choose Product Discovery to find your next great profitable product:
Product Discovery allows you to be as broad or as specific as you’d like when filtering for product ideas. You can keep it simple and just use the basic filters or hone in on specific types of products, keywords, brand, and categories with more advanced filters. With the ability to perform such targeted searching, you can quickly expand your product offering and reach your business goals.
E-commerce is always on the move and always growing, especially Amazon, so we know you don’t have weeks or months to find a good product to source. Time lost is sales lost, which is why we created Product Discovery to help you discover a profitable product in minutes. Beating your competitors to the next profitable product is a huge advantage, and Product Discovery is the fastest way to do just that.
3. Quality Data
If you’ve used Market Intelligence before, then we probably don’t need to convince you about the quality of the data we provide. We aren’t interested in providing our clients with invaluable metrics or archaic data points. We aim for data that is up to date, hyper-accurate and extremely catered to your needs.
We’ve got everything you’re looking for all in one tool, so you don’t have to waste time switching between different software. Product Discovery has all the data, allows you to download your search results, integrates seamlessly with Market Intelligence and lets you save and pin the products you’re interested in, the brands you want to track and more.
If you’d like to learn even more about Product Discovery, check out our detailed walk-through video so you can get a visual explanation of how the tool works. Or, if you’re ready to find your next great profitable product, sign up and pick the subscription package that works for you!