Selling on Amazon? Your product research and selection are absolutely crucial to your success – don’t underestimate their importance! Picking the right product can make your eCommerce business thrive, while the wrong one can make sales and profits a real challenge.
Now, I get it – research might seem intimidating for many sellers, but fear not! Let’s break down what Amazon product research is all about.
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What is Amazon Product Research?
This is the essential process of finding products to sell on Amazon. It’s all about discovering what’s currently in demand and figuring out how you can capitalize on it. The idea is to locate products that you can obtain at a low cost and then sell for a profit. Sounds simple, right? Well, it’s not without its challenges.
During this research, you’ll need to consider several crucial factors that can impact the success of your venture. These factors include the niche you choose, any brand restrictions you may encounter, the competitive landscape, as well as your overall costs and fees. All of these elements play a significant role in determining whether the products you select are truly viable options for your Amazon business.
Why is it Important to do Product Research?
Improving your research skills is crucial for identifying potentially profitable products. Simply picking Amazon products based on looks and assumptions won’t work; often, what you think will sell might be completely different from what your research reveals.
Focus on selling products that have a proven demand, rather than just what you personally want to sell. Success in your e-commerce business requires informed decisions, not guesswork.
One of the challenges for Amazon sellers is knowing where to begin with product research. Products vary significantly, so it’s essential to understand what makes a product good before diving into research.
Good Products vs. Bad Products
When searching for products to sell on Amazon, it’s essential to consider what makes a product “good” rather than “bad.” Finding products that actually sell well is key to your success!
As a seller, you should also assess the product from your perspective. For instance, while big-ticket items like 50-inch televisions might be popular, they come with challenges like storage, shipping fees, and brand restrictions that might not be ideal for smaller sellers.
Instead, focus on products that simplify your eCommerce business and research process. Good products typically have these qualities:
- Small, lightweight, and sturdy – easy to store, pack, and ship.
- Priced between £10 and £50 – appealing for impulse purchases.
- Unbranded (or potential for branding) – allowing for higher profit margins.
- Low competition – offering a chance for market entry.
By focusing on products that meet these criteria, you can streamline your research and make the task much more manageable. No need to worry about heavy, bulky, branded, perishable, or non-impulse buy products for now!
How to Research Products to Sell on Amazon
1. Use product research tools
Here are some user-friendly product research tools you can use to find profitable products on Amazon:
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AMZBase: This tool speeds up your research process by providing valuable information. Simply hover over a product image to see its Amazon Standard Identification Number (ASIN) and title description. Click for historical prices, related content, listing info on other sites, and more.
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AMZScout: With a spreadsheet interface, AMZScout highlights potentially high-volume and highly profitable products. It helps you identify growing trends, verify niche ideas, research other sellers, estimate fees and profits, and predict future competition.
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FBA Wizard: Designed for retail arbitrage (buying products from other retailers to resell on Amazon), FBA Wizard aids in finding profitable products to resell. Note that it might require an invitation during registration.
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Helium10: This robust tool, available by subscription with a free trial, offers various features, including Black Box Product Research, Xray (a Chrome browser extension for product insights), Scribbles (a keyword optimizer for listings), Cerebro (a reverse ASIN search engine for competitor research), and more.
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JungleScout: Another powerful product research tool, JungleScout includes a product database, product tracker, supplier database, keyword scout, sales analytics, and inventory manager. The product database helps you find winning products by identifying those with high demand.
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Keepa: A collection of browser extensions that provide access to product information, such as price history charts, price drop and availability reports, international Amazon prices, and daily deals. Limited access is free, but a monthly subscription expands your data quota.
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Seller App: A comprehensive application for managing your Amazon business, featuring marketing, sales, and operations categories. The product ideas feature helps you identify potentially profitable products based on proven best sellers, trending products, new releases, and most wish-listed items.
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Sonar: This keyword-driven tool shows you what Amazon shoppers are searching for, enabling you to optimize keyword selection for your listings. You can test keywords for free on the Sonar website, but deeper access requires a subscription.
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Unicorn Smasher: Focused on simplicity, this tool identifies products with potential for high volume and profitable sales. It provides comprehensive data, including detailed sales info, sales estimates, and an opportunity score to aid in product selection.
2. Understand Your Competitors on Amazon
To outperform your competitors on Amazon, it’s essential to get inside their minds and uncover their sales strategies. Luckily, Amazon sellers have access to various tools and valuable information to identify their top competitors. Here are some tips to gain insights and stay ahead in the competitive Amazon marketplace:
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Identify Top Competitors: Determine the primary keywords for your products and analyze the first and second pages of search results for these keywords. The sellers of top-ranking products are your real competitors, as they are selling well and have earned customer trust.
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Amazon Best Sellers Rank: Check the “Amazon Best Sellers Rank” on your product detail pages to gauge your product’s performance relative to others. Explore Best Sellers pages in your categories to get real-time data on the top 100 products, helping you spot trends and boost sales.
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Learn from Product Detail Pages: Investigate your competitors’ product detail pages for clues on how they’re attracting customers. Look for product carousels strategically placed by Amazon and competitors, such as sponsored products related to the item, frequently bought together items, and more.
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Assess Your Competitors: Once you’ve identified your key competitors, dive deeper into their strategies. Keep track of the following details:
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Products they recently added to their catalogs and are selling well: This helps you understand the type of products you should consider selling.
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Competitor product ratings and reviews: Avoid competing with products that already have many positive reviews. Instead, consider products with fewer positive reviews or several one- to three-star reviews as they may present opportunities to offer superior products or customer service.
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Competitors’ sponsored products: Pay attention to which products your competitors are promoting through sponsored ads, as this indicates where they’re investing to gain traction.
3. Explore Chinese Wholesale Marketplaces for Product Ideas
China is the world’s manufacturing hub, producing millions of products that are exported globally. Researching products from Chinese wholesale marketplaces can provide valuable insights into potential trending products in the United States and other markets. Here are some platforms worth exploring:
Alibaba: This is the largest B2B marketplace globally, connecting sellers with suppliers to source products for Amazon resale. Browse the website to find a vast range of suppliers offering various products. Check out the “Best Selling Products” section to discover hot-selling items. Compare quotes from suppliers to find the best price and quality balance for your business.
AliExpress: Ideal for small sellers looking for smaller quantities at competitive prices. The “New User Section” lists hot deals for new users, some starting at just $0.01. You can also explore AliExpress’s Dropshipping Center, where you can sell products without handling inventory. It’s a hassle-free way to retail.
DHGate: This wholesale marketplace connects retailers with high-quality factories for bulk purchases at lower prices than retail. It has millions of product listings, offering various options.
Global Sources: A platform connecting wholesale suppliers with international retailers, including major players. Here, you can find suppliers across different categories, such as auto parts, electronics, fashion accessories, home products, and more.
Made-in-China: While not ideal for in-depth product research, this platform hosts over 10,000 verified suppliers in various industries. You can submit a request for a quote when you find a product you want to sell.
DIY Trade: A B2B trading platform with access to over five million products. Suppliers post their products, and you can subscribe to product alerts for early notifications of new items. DIY Trade also provides popular keywords and categories to aid in product research.
Conducting thorough research on these platforms can help you discover the best products to sell while enhancing your overall product knowledge and your ability to select items with high sales and profit potential.
4. Validate or Reject Product Ideas
During product research, you may come across numerous promising product ideas, but not all of them will be successful in the market. It’s essential to vet your product candidates to identify the top contenders. Here are some considerations to help you weigh the pros and cons of different product choices:
Weighing the Pros and Cons of Innovative Products:
Pros:
- Innovative products can command premium prices due to limited competition.
- Selling cutting-edge products can build your reputation and increase brand loyalty.
Cons:
- Educating customers about new products can be time-consuming and may result in shorter attention spans.
- High prices and limited appeal to late adopters and budget-conscious consumers can affect sales.
Considering Seasonal Products:
Pros:
- Seasonal products can lead to significant sales and profits during peak periods, like the Christmas season.
Cons:
- Seasonal sales are inconsistent and challenging to predict, making inventory planning difficult.
- Relying solely on seasonal sales can be risky, and a year-round selling strategy is essential.
Giving New Brands a Try:
Factors to Consider:
- Trust: Established brands are trusted for their quality and customer service, whereas new brands may raise concerns about product durability and after-sales support.
- Familiarity: Customers often have preferences for well-known brands, making it challenging for new brands to break through.
- Cost: New brands may offer deals to increase market share, providing opportunities for higher profit margins.
- Opportunity: Supporting a superior new brand early can establish you as a go-to retailer for that brand in the future.
Before embracing a new brand in a category dominated by strong competitors, carefully consider these factors to make informed decisions.
By thoughtfully evaluating product ideas and considering their potential, you can make informed choices that lead to successful Amazon selling.
5. Focus on Price and Sales Volume
Product selection often comes down to price and sales volume. To pick the right products for your Amazon business, ask yourself if you can sell enough items at a good price to make a worthwhile profit. This section offers techniques to evaluate price and sales volume effectively, enabling you to make informed product and pricing decisions.
Different Pricing Strategies:
Consider various pricing strategies to boost sales, revenue, and profits:
- Cost-plus pricing: Calculate your cost and add a markup for desired profit.
- Competitive pricing: Set your price based on your competitors’ rates.
- Value-based pricing: Determine the market price and add extra value for your product’s unique features.
- Price skimming: Start with a high price to capitalize on initial demand and lower it later.
- Penetration pricing: Enter a new market with lower prices and raise them gradually.
- Loss-leader pricing: Offer one product at a loss to encourage sales of other profitable items.
- Destroyer pricing: Temporarily sell below competitor costs to discourage competition.
Keep an Eye on the Competition:
Competitive pricing is crucial on Amazon, where low prices are favored. Monitor your competitors’ pricing data to:
- Gain insight into their strategies and trends.
- Identify opportunities to increase profits without sacrificing sales.
- Negotiate better prices with suppliers.
- Develop an intuitive sense of product value for better decision-making.
Estimate Sales Volume:
Estimating potential sales is essential to determine the viability of products. Utilize product analysis tools or other sources to estimate sales figures. Consider seasonal fluctuations and market trends to make informed projections.
Set Realistic Profit Projections:
To ensure profitability, calculate your gross sales revenue for the next 12 months based on projected sales volume. Factor in supply and demand fluctuations, such as holiday peaks. Estimate variable costs that may change over time, and calculate gross profit by deducting variable costs from gross revenue. Lastly, consider fixed costs (e.g., employee salaries, rent, utilities) to determine your net profit.
By analyzing pricing and sales volume strategically, you can choose products that yield higher profits and build a successful Amazon business. Regularly evaluate your profit projections to stay ahead and address any declining trends proactively.
Final Thoughts
If you follow the established criteria and remember to narrow your Amazon product research into niches while using information about competitors and trends, Amazon product research will never feel daunting.
There’s no need to waste time finding non-starters when you can reduce your research and identify a best-selling product by using the readily available Amazon research tactics described above.
If you don’t want to bother about product research, you should explore other ways to make money on Amazon.