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As an Amazon seller, most businesses often look at the products they already sell, or can buy from their suppliers, and try to figure out how to make them profitable on Amazon. This process is like trying to fit a square peg into a round hole, and sadly speaking it will never work if you picked up the wrong item, to begin with.
Fret not though, I can always reverse engineer this problem. So here it is – in this post, I will be listing down the few traits shared by-products that have been proven successful on Amazon in the past, so that you can create/find a new product with all the right properties to be a future bestseller!
And the first up is this:
#1: Size
Whether you trade as a third-party seller on Amazon marketplace or sell wholesale to Amazon as a vendor (or some combination of seller and vendor), there are always logistics costs to be factored in. The bulkier and heavier a product is, the higher the logistics costs will be.
As a third-party seller on Amazon, the logistics costs come back to you clearly, whether you use FBA or fulfill orders yourself. If you sell to Amazon as a vendor, the costs are still there, but they are Amazon’s and will be factored into the price they are willing to pay for your goods.
As such, I will recommend selling smaller-sized items. This is because smaller products have less pressure on the price to end-users. For example, memory cards: they can be shipped by envelopes quickly at very cost-efficient rates. Meanwhile, cheap bulky items often have to increase their price to factor in all costs and can become unattractive to shoppers.
#2: Price
Amazon best-selling products normally come from within the mid-price range between $25 and $50 and are of a relatively compact size. This is because low priced items become unprofitable quickly – below $15, products are easily overwhelmed by delivery and warehousing costs. Meanwhile, products over $150 or so can yield good profits, but lesser units will be sold due to its high price.
The general rule of thumb is to ensure that your products are not overpriced. You should try your best to price your products below psychological trigger points, and yet at the same time achieve a good ranking among those of the same category.
The best products will be those which are profitable, yet are at a competitive price point. Having a healthy profit margin provides the opportunity to generate traffic and boost sales through Amazon Marketing Services (sponsored products ads, headline search ads, product display ads) and through promotions (lightning deals, best deals, vouchers).
In general, price and size are linked via the value-to-size ratio. Expensive, small items have the highest value-to-size ratio, while cheap, large items have the lowest. To find the best products to sell, you should always keep this rationale in mind. If the value-to-size ratio is too low then costs will kill your offer, making the product too expensive to advertise and your price uncompetitive. Conversely, if your products have a high value-to-size ratio, it will most probably become the next bestseller on Amazon, so do look out for such items should you come across them in your sourcing process!
Let me continue to the third trait of proven successful products on Amazon:
#3: Distribution
As all know, Amazon is a company that strives to offer the best shopping experience to its customers by providing the best prices in the market. It has one of the most powerful pricing mechanisms in the world.
Although Amazon is not a price setter, it is a very strong, smart and quick price follower. Many times per day, it scans its own marketplace for other sellers offering the same product, and also other e-commerce sites so that it can adapt its price to the cheapest offer.
Thus, if you sell to Amazon as a vendor, or Amazon decides to sell the same products as you in the marketplace, this price pressure will come straight back to you. Vendors will be asked for extra rebates, and sellers will lose the Buy Box.
However, things will be different if you are selling products with limited distribution. Products with limited distribution aren’t easily available from a large number of online retailers, and thus if you can bring a product to Amazon that isn’t available anywhere else online, there will be much less pressure to reduce your prices. When your products’ selling price is controlled, your profit margins will naturally be protected.
On the contrary, if you sell products with uncontrolled distribution, this will show immediately in the pricing on Amazon. You will find yourself lowering your products’ selling prices in order to get more sales and remain competitive in the gigantic Amazon markets.
Let me introduce you to the fourth trait of proven successful products on Amazon:
#4: Brand
It is known that Amazon wants to list all the products in the world so as to become the biggest online marketplace. They are very interested in brands and branded goods, thus those doing private labeling business will find it great selling their products on the Amazon platform.
Having a branded product helps to single the seller out. The seller can make use of Amazon’s marketing tools (A+ content for vendors, EBC pages for sellers) which are only available to brand owners, and tell the story of your brand/products to your customer. This will be done through your own Amazon store pages. For example, a nutrition brand with strong values on providing better health to the world will have the opportunity to share its powerful message on Amazon and hence attract more customers.
This means, in some cases, that little-known brands are a better prospect on Amazon than really well-known branded products. Big brands are already being sold, so there’s a lot of competition and price pressure, and little value that you can add. Generic products have very little scope to build recognition and tell a story. But smaller, good quality brands that are not yet established can tick all the right boxes.
In essence, Amazon is providing big opportunities for small players, so do work around this if you want to get a bestseller product to sell on Amazon!
Here’s the fifth trait of bestseller products on Amazon:
#5: Marketability
The most successful products on Amazon are the ones you understand straight away and with easy-to-explain features. Thus, when you are sourcing for products, best choose products which in themselves already have uncomplicated and straightforward benefits.
Marketability is key – bestselling products are usually those which you can immediately catch the benefits of from one picture. For example, a smartphone case with a new support system shown in one picture will result in quick purchases and strong growth in your business.
Remember, as, on any other e-commerce websites, you can only sell with pictures, text, and video on Amazon no matter how unique your products may be. The next time before you decide to invest in some novel products, ask yourself if you can visually show the benefits of these products with photos, videos, and text. I have seen examples of products, including some which are incredibly innovative and beneficial, that do not land themselves well with visual illustrations. It is a real battle to sell those on Amazon, and I definitely hope you will not fall into this pit hole only to regret later as you end up with dead stock.
At the same time, when crafting your listings, you may want to focus your efforts on generating value-added content – what makes your product stand out from others? Can you capture these outstanding features of your products in a few words and one or two images? If you find it hard to do that, then I suggest you better skip this product altogether.
Finally, this is the last trait of bestseller products on Amazon:
#6: Availability
This may seem obvious, but it has been the downfall of many products that otherwise had every attribute for success. If the product is not readily available, then it won’t sell. Once your stock runs out on Amazon, your seller ranking will drop. In turn, your product will become hard to find within the mass sea of products on Amazon, needless to say, any sales. By the time you replenish your inventory, your competitors could have moved in and a good product will never get to reach its potential.
So, only go ahead with a product if you can secure and maintain consistent volumes of stock. Not being able to provide inventory will make everything else you have done useless. It’s better to hold off from selling a product until you are confident of a good supply, than move in early and risk damaging the market.
Let me do a quick summary of the attributes of best-selling products on Amazon:
#1: Small size (or a good ratio of value-to-size)
#2: Mid-range price
#3: Limited distribution
#4: Branding your products
#5: Features that are easy to market
#6: Consistent availability of stock
Stay tuned for more tips like this!
