13 Top Tips on How to Be Successful with Selling on Amazon
If you’ve ever wondered how to make money selling on Amazon, you’ve probably come across a variety of tips. The sheer amount of companies and individuals offering a “get rich quick on Amazon scheme” requires you to keep a rational eye when choosing which tips to follow. There are a variety of things you should keep in mind when starting your business as well as running a successful one. One thing’s for sure though, Amazon is and remains the go-to address for online shoppers and, therefore, a chance any e-commerce seller should have an eye on.
In this blog article, we will show you what you should pay attention to when you first get started on Amazon but also what to watch when it comes to maintaining and growing your business.
How to Become a Successful Seller on Amazon?
Becoming an Amazon seller on the U.S. marketplace, for example, requires a valid government ID, a chargeable credit card, and your tax information. In order to protect customers and businesses from fraud, you will need to undergo the Amazon seller verification process. This is where your ID comes into play.
Before you start your Amazon seller registration process, make sure you have all information ready, in order to speed up the process. Here are a few other things to consider before starting your Amazon seller journey:
#1 Choosing an Amazon Seller Plan
To create your Amazon seller account use the sign-up forms in Seller Central.
When you register for an Amazon seller account you have to pick between two plans: Individual and Professional. While the first option is for beginners, the second is directed at more advanced sellers. However, as soon as you want to use more features like the option of creating listings in bulk or using Amazon Advertising you will need to use the Professional plan.
Another difference between the two plans is the costs. While you pay a monthly fee of $39,99 for Professional, you will be charged $0,99 per item sold for Individual. So, if you sell 40 or more units per month you are better off picking the monthly fee.
#2 Take Additional Costs Into Account
Amazon merchants have to pay several different fees like the ‘Category Referral Fee’. Depending on the category your products are listed in, you have to pay a percentage of the final price (including shipping costs and any gift-wrapping charges) per sold item.
If you sell a pacifier for babies with a final price of 5.99 you will have to pay Amazon 0.48 (That’s 8%). You can find an overview of all referral fees for 2021 on Amazon’s help pages.
Other Amazon seller fees include, for example, the high-volume listing fees or such for additional programs like Amazon FBA.
A tool that may seem interesting to you as an Amazon seller is the profit or margin calculator. Just insert your costs of the good, your listing price, the category, and the fulfillment method. Be cautious though. This does not reflect your actual profit. Additional costs, like fees for the Amazon seller program FBA or your seller plan, are not included here.
#3 Find the Perfect Product to Sell
How to be successful by selling on Amazon 101: Pick a product that will gain you maximum profits with the lowest effort. While this sounds like the dream of every seller on the planet, there are some conditions your product should hit in order to become the product of your dreams:
How Do You Find a Perfect Product?
Finding the next big emerging trend can be challenging and may seem like a lot of guesswork. However, there are useful tools available to assist you here. One free option is Google Trends, which analyzes search queries by region and language, providing valuable insights into potential upcoming trends.
Monitor the Competition
Once you have found a product with great demand you need to check out the competition. How many sellers offer this product already? Which price do they set? Is it a very competitive market? If there are few sellers, this product might be worth a try. But if there are already hundreds of offers, you may want to stay out of the competition.
Calculate Potential Profits
If you think the product you’re interested in is a good investment, try to estimate the profits you’ll make by comparing competitor prices to the costs you’ll incur when selling it. In order to maximize profits as an Amazon seller (or a seller in general) try to keep your costs as low and the price as high as possible. If you want to set your prices according to the actual demand, a dynamic repricing tool is a big step toward increasing your revenue while saving you time and money.
By the way, setting the right price is a topic for itself. If you sell your product too cheap, it will not be profitable. If it is too expensive on the other hand, capital lockup is extremely high. The rule of thumb is to set a price between 10€ and 30€. In this price range it is also easier to sell, as it encourages spontaneous shopping.
An easy way to cut costs is picking products that are small and lightweight. You will need less packaging material and shipping costs will not go through the roof either. As an Amazon seller you can also use FBA, meaning that Amazon will fulfill your orders for you. Picking a product that is small and light will also keep your FBA fees under control.
Analyze the Potential Demand
How to be successful with selling on Amazon: Find a product that is not seasonal like Christmas decorations. You need a steady income, so sell products with a steady demand. In the case of Christmas decorations, it is quite obvious that the demand will be highly seasonal. But what about beachwear? Let’s look at Google Trends:
This screenshot shows how often people searched for ‘bikini’ in Germany within the last 12 months. You can see a definite increase in spring/summer. Taking into account the weather conditions in Germany that is what we would expect to see. The demand for beachwear is rather low when temperatures are low.
Now let’s look at Australia in comparison:
While there still are some changes over time, the interest for the same keyword is much more steady than in Germany. Australia is known for its beach culture and warm weather. It’s reasonable to expect a much more steady demand for beachwear then.
Now it’s time to optimize your product information and grow your business.
#4 Amazon Seller Wholesale vs Private Label
When you’re thinking about how to be successful by selling on Amazon, you should not only be thinking about what product you want to sell but how you want to sell it. You basically got two options here: You either resell third-party products (e.g. a bikini from bonds) or you create your own brand. Of course, you can also do both but if you are just getting started with your Amazon journey we recommend you only pick one. You can always expand your business later.
Let’s have a look at some main differences between Private Labels/Brands and Wholesale.
Check our blog post for in-depth information about Wholesale vs. Private Label for Amazon merchants.
#5 Start Selling on Amazon
So, you’ve got an Amazon seller account and a product to sell, it’s time to start selling. What you have to do now heavily depends on the choice you made regarding Private Label or Wholesale. If you chose the latter and another Amazon seller has created a listing for that product already, you can just add your offer to the existing page.
If you are selling your own brand, you will need to create a new product page. Here are a few tips for creating new listings:
If you need some further information, check out our post about Amazon SEO.
How Do You Maintain a Successful Amazon Seller Business?
So this is it: You have successfully started your own Amazon Business. Now it’s time to optimize and grow.
#1 Work on Your Amazon Seller Rating
It offers details on your account’s overall health. If your account is performing poorly, you may lose the Buy Box or see a lower ranking in search results, which can negatively impact your profitability compared to a healthier account.
Amazon evaluates a seller’s performance based on several key metrics, all aimed at ensuring the best possible customer experience. Here are some methods to enhance your seller rating:
Ensure Great Fulfillment
Amazon customers have high expectations for fast, defect-free delivery, real-time tracking, and excellent customer support. Amazon sets these standards, especially for Prime members, and expects sellers to meet them.
You have two, sometimes three fulfillment options: FBM (Fulfillment by Merchant), FBA (Fulfillment by Amazon), and Seller Fulfilled Prime (by invitation only through Amazon). The choice depends on your business needs and skills. Note that using FBA can give you a better chance to win the Buy Box, as Amazon trusts its own fulfillment services.
For more details on these models, check out our article on selling on Amazon.
How to Be Successful with Amazon FBA?
Even though Fulfillment by Amazon helps the seller to ensure the best fulfillment and customer support, there is also the other side of the medal. You can find several complaints about the service across all Amazon forums. As processes in the Fulfillment Centers sometimes get a bit confusing, problems like missing items in your inventory may occur. However, detecting FBA mistakes can become quite tricky, as you have to compare up to 12 reports in order to find an issue.
Of course, you are eligible for refunds if there are problems with items in your inventory. In Amazon Seller Central you can request your refunds by entering the corresponding FNSKU. The reimbursement claim will then be checked by Amazon. In case your request will be declined, you can contact the Amazon seller Support team and try to hand in further details about the issue.
How to do business through FBA with Amazon? As we described above, there are many manual procedures that are rather slow and in most cases not as effective as they could be. But the right tools for an Amazon FBA seller can help ease up the process. SELLERLOGIC Lost and Found analyzes all FBA reports in order to find hidden reimbursement claims and prepares all relevant information for you. In case Amazon does not accept your claim in the first place, our Customer Success Team will support you with the ongoing communication with Amazon.
So, is Amazon FBA profitable for you? That depends on a lot of factors. How you handle time-consuming processes like the one above is one of them.
The Importance of Amazon Seller Feedback
A good way to figure out how to be successful with selling on Amazon is of course by reading reviews. Customer feedback is crucial for any online seller. Shoppers cannot test the product they are about to buy like they can at a shop. Instead, they need to rely on what the seller says about the product. To be fair, this may not always be the most neutral presentation of it.
This is where customer reviews come into play. They represent actual customer experiences and help future shoppers draw their own conclusions about the product and Amazon seller. Moreover, they are relevant for your seller rating and therefore also for your Buy Box share.
Check our video if you need more tips on how to get more reviews without risking your account being suspended:
Always Make the Right Pricing Decisions
The most important metric when it comes to winning the Buy Box is the final price. Although it’s rumored that the lowest price always wins, that is actually not the case. Instead, the perfect combination of the final price and the other metrics will be rewarded with the Buy Box. So, you might actually be able to sell at a higher price than other Amazon sellers on that listing.
You can find in-depth information and further criteria for a healthy account on Amazon in our post.
#2 Increase Your Visibility
If you wonder how to be successful selling on Amazon, you should definitely think about visibility on the marketplace. At the end of the day, a great product sold by a merchant with great seller metrics won’t sell well if it is listed on page 5 of the search results.
In order to increase visibility on Amazon, there are basically two options: SEO and Amazon Advertising. Let’s dive deeper into that:
Increase Visibility Thanks to SEO
Good SEO skills will make the algorithm match your product to customers’ search requests. Hence, better visibility. But good SEO can also increase your conversion rate. Both visibility and conversion rate can boost your sales.
Unlike in a brick-and-mortar store, shoppers cannot test your products or take a closer look at them in order to inspect them. Your listing has to take over this job now. Try to put yourself in the shoes of your customers and ask yourself: what are the most important things you would like to know about this product?
Here are some quick tips:
If you want to learn more about Amazon SEO, you should check this article.
Spots on Your Product: Amazon Advertising
Another tip that will pop up when you’re trying to learn how to be successful selling on Amazon will definitely be Amazon Advertising. It is a great way to promote your products and gain visibility.
We cannot run you through everything that Amazon Advertising means, but we will try to give you a quick overview of it.
The main forms are:
And if you want to go big:
#3 Analyze Your Business Ongoingly
Success on Amazon hinges on constantly evaluating your strategies. Remember the fidget spinner craze of 2017? It’s a perfect example of why tracking your business is crucial. Here’s how you can do it:
1. Stay Alert to Demand Changes: Trends can fade quickly. By tracking, you can join market hypes early and exit before demand drops, avoiding losses.
2. Identify Profitable Products: Understand which items generate cash and which ones drain resources. Focus on top performers and phase out underperformers.
3. Manage Costs Efficiently: Prices and fees fluctuate, impacting your bottom line. Track costs to make informed decisions and stay profitable.
4. React Swiftly: Keep an eye on inventory and the Buy Box status to avoid stockouts and lost sales opportunities.
If you’re looking for a way to monitor your company’s profitability quickly and accurately, SELLERLOGIC Business Analytics was written for you.
#4 Grow Your Business
When you’re looking for ways on how to be successful with selling on Amazon, focusing on growth is essential. Here are five strategies to help you achieve that:
To succeed on Amazon, growth is essential. Here are five strategies to help:
1. Expand Internationally: Amazon has twenty marketplaces, including major ones like Germany, the UK, and China. Using Amazon FBA, you can easily manage cross-border sales.
2. Reinvest Your Profits: Use your profits to invest in new products and PPC campaigns. Reinvesting is key to staying competitive and growing your business.
3. Go For Repeat Customers: Build customer loyalty through excellent service and high-quality products. Repeat customers boost rankings and bring in more sales.
4. Cross- and Upselling: Offer related products (e.g., nappies and wet wipes) and premium versions to increase sales. Strategic advertising and bundling can further boost revenue.
Remember, these strategies can enhance your success with relatively little extra effort.
#5 Accept Amazon’s Terms and Conditions and Play by the Rules
The Amazon seller Policy is of great importance and should not be left out. When you sign up to become an Amazon seller, you have to accept the terms and conditions. Any violation may result in your account being deactivated or even closed down. If you want to learn more about how to prevent it check our 6 tips on how to avoid suspension of your Amazon seller account.
Amazon’s seller Code of Conduct as well as all policies on the marketplace ensure safer and better shopping for customers.
#6 Use the Right Tools
When it comes to the question of how to be successful with selling on Amazon, there is no doubt about the fact that this will require hours of handling tedious processes. Reimbursement claims, maintaining a healthy pricing strategy and tracking business performance are some of them. But here’s some good news: The right tools can help you save time and money.
The sheer volume of tools alone overwhelms many sellers. This is why we broke it down to the bare essentials every company striving for success on Amazon should have.
Use your Analytics tool to observe the market as well as your own performance and find out how you can improve. Tools like Perpetua also offer functions like SEO optimization, PPC Management, and Product Research. SELLERLOGIC Business Analytics is a profit dashboard, which enables Amazon sellers to track their performance on the account, marketplace, and/or product level. With its detailed overviews of relevant product data and different filtering options, the dashboard enables sellers to identify profit drainers and serves as a basis for well-founded business decisions.
A dynamic repricer can help all Amazon sellers, no matter if you are selling Wholesale or Private Label products. As we pointed out previously, it is important to always set the perfect price. But as this task takes up way too much time to do manually you should get a repricing tool to set your prices according to your wishes automatically. A good repricer should offer different strategies for you to choose from, so you can make sure it fits your business goals.
Last but not least all Amazon FBA sellers should use an FBA reimbursement tool. Otherwise, you lose your money. On average sellers lose 6,480.90 € every year from unclaimed reimbursements. While you have enough time for other important jobs, the software analyzes all your reports and finds claims up to 18 months retrospectively.
Find out more about helpful Amazon seller tools here.
#7 Optimize for Mobile
A significant portion of Amazon shoppers use their mobile devices to browse and make purchases, making it crucial for sellers to optimize their listings for a seamless mobile experience. Here are several strategies to ensure your product listings are mobile-friendly:
1. Responsive Design: Ensure listings adapt well to different screen sizes and check their appearance across devices.
2. High-Quality Images: Use high-resolution, clear images that load quickly and show multiple angles, as mobile shoppers rely heavily on visuals.
3. Concise and Clear Titles: Craft short, keyword-rich titles to ensure essential information is immediately visible on mobile screens.
4. Bullet Points and Short Paragraphs: Use bullet points and short paragraphs to make descriptions easy to read and highlight key features.
5. Optimized Keywords: Naturally integrate relevant keywords to improve search visibility, considering mobile-specific search behavior.
Ensuring easy navigation on your Amazon listings is crucial for maintaining customer engagement and increasing conversions. Start with an **intuitive layout** that allows users to find information effortlessly. A well-structured layout should have a logical flow, guiding the user seamlessly from one section to another. This reduces the friction that could lead potential buyers to abandon their search.
Including quick links plays a significant role in keeping users engaged. Quick links to related products allow customers to explore your other offerings, potentially leading to additional purchases. Adding links to customer reviews provides social proof, which can be a decisive factor in the buying process. Additionally, quick access to detailed information such as shipping policies, return procedures, and product specifications helps answer potential questions and reassures users, making the shopping experience more efficient and satisfying.
By prioritizing easy navigation with an intuitive layout and quick links, you enhance the user experience, which can translate into higher sales and better customer satisfaction.
Final Thoughts on How to Be Successful Selling on Amazon
Is selling on Amazon really profitable? Fair question. It is, yet it takes a lot to become and maintain a successful Amazon seller business. You need to plan the costs, pick a seller plan, find a product, analyze the market, etc. All of this just to get started. Once you’ve got everything set up, you have to grow your business. A lot of new jobs like working on your seller metrics will come into place then.
At the end of the day, Amazon is the go-to address when it comes to online shopping and has immense potential for brands and retailers.
Make your life easier by using Amazon seller software tools that will save you time and money. However, ensure that you only use the tools that you actually need. Otherwise, you will pay for nothing.
Frequently Asked Questions (FAQs)
People selling on Amazon have to face several fees for their activities on the marketplace. There are a lot of different fees for Amazon sellers like the fees for the professional selling plan. Additional fees are the ‘category referral fees’ which will be charged as a percentage per sold item. If you want to use extra services like Amazon FBA, you will also be charged fees for that.
Amazon charges their sellers an extra fee per sold item, called the ‘Referral Fee’. Depending on the category the product is sold in, the fee lies between 5 to 45% of the final price.
No. You have to pick between two plans: Basic and Professional. With the Basic tariff, you will be charged 0,99 per sold unit plus the referral fee. The Professional option costs 39,99 per month plus a referral fee but you will not be charged extra per sold item.
In the Amazon Seller Central, merchants can manage their Amazon businesses. This is where you create listings, manage orders and inventory, as well as your Amazon Advertising or FBA. Everything that affects your business on Amazon has to be organized in the Seller Central.
Image credits in order of appearance: © IRStone – stock.adobe.com / ©Screenshot@Google Trends / © Nuthawut – stock.adobe.com / © baskaraya – stock.adobe.com / ©Love the wind – stock.adobe.com / ©Mykyta – stock.adobe.com
