Avoid Amazon FBA Failure With These Simple Rules

andrew browne Uncategorized 2 Comments

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You can reduce the chances of your Amazon private label product failing, and increase your chances of major success if you do the following:

  • pick the right product
  • find the right keywords
  • create an effective listing
  • test your listing as much as possible
  • run Amazon ads effectively
  • find similar products to cross sell with your other popular products

 

Are you Scared of Launching a Dud Product?

 

When I ask most Amazon Private Label sellers that question, many of them say yes. Of course, they are scared of investing money, time and energy into a product that may not sell.

 

Even the more advance sellers are scared to pick a dud product. Clearly, these more advanced sellers know how to sell products on Amazon, but this does not mean they will be successful every single time they launch a new product, and they know this.

 

Whether we like it or not, dud products happen.

 

I can relate to this fear. I know anytime I enter into a business, I am fearful of failure. You don’t want to invest too much time and energy into a losing endeavor.

 

However, i also know that you can’t let this fear paralyze you into inaction. In order to make money in business, you will have to invest money, and you will have to take risks.

 

There are several ways you can limit your risk of selling and marketing a dud product.

 

If you can limit your risks by knowing how to pick a good product and how to successfully launch and sell this product, you will greatly reduce your chances of failure.

 

Pick the Right Product

 

  1. The basics

 

Most private label sellers use the same criteria when picking a private label product.

 

They usually want to pick a product that is not too cheap because shipping and Amazon fees will eat away at their margins, and not too expensive because it would take more capital to source these products. In addition, higher priced products tend to have less sales.

 

They also like to pick products that are lightweight, which reduces shipping costs.

 

They also like to pick products that are not complex. Complex products are products like electronics or items with a lot of moving parts.

 

These tend to be hard to source and tend to break more during shipping. If a product tends to break more during shipping, it will cost you a fortune in returns.

 

Finally, they want to pick a product in a niche that is not brand driven. Customers shopping in a brand driven niche want only brands they know and trust, and it would be very hard for a new seller to establish their brand in that niche.

 

For example, a traditional seller would not choose to sell shoes because the shoe niche is very brand driven. Customers want to buy Nike and Adidas, and not “Joe Blow’s Private Label Shoe Special”.

 

Now let me remind you, this is the criteria most sellers use when trying to find private label products to sell on Amazon, but it’s not the only way to enter into the Amazon private label game.

 

In fact, because most private label sellers use this criteria, the market is now flooded with competitors. However, by understanding this criteria, you can use the principles behind these ideas to create your own criteria.

 

  1. Other considerations

 

A. Seasonality

 

Check the seasonality of the product you are thinking to sell on Amazon. You may want to avoid products that only sell during one time of the year, as your inventory will just sit in a fulfillment warehouse until peak season, and you won’t be making many sales until then.

 

I recently talked to a veteran seller who made this mistake.  He picked his product assuming it was not seasonal, and during the first few months after his launch business was booming. However, when winter came, his sales slowed down to a near halt.

 

When he told me his product, I too assumed that it was not seasonal, but when we checked Google trends we found out that it was indeed seasonal. Don’t assume a product is not seasonal, check first.

 

Again, there are many ways to sell a product. You may want to avoid a seasonal product, or maybe you would want to pair a seasonal product with another seasonal product that has its peak at a different time of the year.

 

If you pair two products with opposite peak seasons together, you can even out your sales by relying on the product in the peak season to have more sales than the product in the slow season.

B. Depth of market

 

Always check out the depth of the niche you are entering.

 

You want to find a niche where most of the products in the first 2 pages of the main keyword are making a large number of sales per day. If you are entering a niche where only the first 2-3 products on the first page of the main keyword are making sales, it may be too hard for you to break into a rank that would give you organic sales.

 

Again, this is one way to do it. However, because most sellers are using this criteria, you may decide to enter into a market with low depth of sales to avoid increasing competition.

 

However, if you do go down this route, understand you may have to run more promotions and more ads to rank your product where it can start actually making organic sales

 

C. Do a full profit analysis

 

You must do a full profit analysis before deciding which products you want to sell.

 

Make sure you factor in the price of manufacturing and shipping from China (or wherever you are sourcing your product from).

 

Check out the Amazon Revenue Calculator to calculate your Amazon fulfillment and referral fees.

 

Launch Your Product Effectively

  1. Find the Right Keywords

 

After you have picked the product you want to sell on Amazon and sourced that product, you should start working on your listing.

 

This will include finding the right keywords to put in your title, product features, description and search terms box. You want to find keywords that your customers are going to be entering into Amazon to find your product.

 

To get keyword ideas, look at your competition and what they are using for their keywords.

 

Also use automatic campaigns in Amazon ads to find keywords that are effective in bringing you impressions and conversions. Don’t let this run for more than a week or two though, because Amazon automatic campaigns tend to be too broad.

 

You can also use tools like MerchantWords and Google Keyword Planner to estimate the search volume of certain keywords.

 

You can also use our tool, AMZ Split, to test which keywords are driving the most impressions and conversions.

 

  1. Create your listing

 

Write a catchy title that will grab customers’ attentions. Make sure you use your best keyword in this title.

 

Write product features that highlight the benefits of your product. Try to add some sort of money back guarantee here. Sprinkle more of your keywords here.

 

Add a description that describes your product and that adds more keywords to your listing.

 

Grab eye catching pictures that feature your product in different angles. Also try pictures that focus on people using your product.

  1. Continually optimize your listing

 

It is not enough that you create a good listing from the start. You should always be testing your listing to make sure it is the very best it can be. I think this is the one step even seasoned sellers often forget.

 

The more optimized you make your listing, the higher your conversion rate will be. A higher conversion rate will not only increase your bottom line, it will also increase your organic rank for certain keywords.

 

A higher organic rank will lead to more Amazon organic sales, which will also further increase your conversion rate. This will be a snowball effect with your momentum continuing to grow with each sale.

 

Therefore, you should always be testing

  • images
  • pricing
  • keywords
  • titles
  • product features
  • descriptions

 

Amazon is not something you can set and forget. Your competition is always looking for ways to get ahead of you. They are testing their listings to see how they can get an advantage over you.

 

If you are not testing and optimizing your listings, you are going to lose ground to those who are testing. Take the proactive steps and always look for ways to optimize and test your listings.

 

  1. Make sure you are running effective amazon ads

 

After finding your main keywords, you should be running Amazon PPC ads to increase your sales, and to eventually rank for these keywords.

 

Run campaigns for these keywords. After a few weeks, check their stats. Make sure you find the ones with the lowest ACoS. Find the winners and reject the losers.

 

Don’t keep running ads for the losing keywords. They will just continue to eat through your advertising budget.

 

Continue to add more keywords to your campaign, and continue to pick the winners and discard the losers.

 

  1. Find products in the same niche as your hot selling products

 

If you find a product that is a hot seller, try to find a product that is in the same niche as that product, so that you can cross sell your new product with the old hot selling product.

 

This will help you build not only a product list, but a brand that you can eventually start selling off of Amazon.

 

Conclusion

 

There is always inherent risk in business. Anytime you invest in business you are risking losing that investment. Selling private label products on Amazon is no different.

 

However, you can greatly reduce your risk by picking the right product, finding the right keywords, learning how to create a product listing that converts, testing your product listing, running effective Amazon ads, and finding similar products to cross sell with your other hot selling products.

 

If you do the above, you greatly reduce the risk of having your product fail, and greatly increase your chances of making huge profit in your Amazon business.

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Comments 2

  1. Hi, thanks for the article. I am just learning about FBA. How does one “find a niche where most of the products in the first 2 pages of the main keyword are making a large number of sales per day”?

    Thank you!

    1. Hey Erica,

      Welcome to the FBA world 🙂

      You can find sales estimates for products using tools like Jungle Scout. There is also a host of information over on the Jungle Scout blog about finding products and launching your own FBA business. Also be sure to check out the Million Dollar Case Study, it’s a free course that walks through the entire process from the start!

      Thanks for reading
      Kym

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