Did you know that 52% of third-party sellers on Amazon earn more than $1,000 per month? And 18% of third-party sellers see more than $10,000 in sales per month. Selling on Amazon is an excellent opportunity for anyone to build a sustainable passive income stream.
Don’t assume that means you can make tons of money with no effort, though. It takes time, forethought, and investing some money to sell successfully on the Amazon marketplace.
If you want to learn step-by-step how to become a successful Amazon seller, you’ve come to the right place. Here are the contents of this guide:
- How to Find Products to Sell on Amazon
- How to set up your Amazon business
- How to optimize your listing to increase sales
- How to launch a new product on Amazon
- How to get customer reviews on Amazon
Let’s dive right in.
How to Find Products to Sell on Amazon
If you’re a beginner, you first need to know what to sell on Amazon. So, let’s talk about a strategy to find great products for your Amazon business.
First of all, selling on Amazon – like any other ecommerce business – requires an investment of time and money.
85% of sellers agree – selling on Amazon isn’t a get-rich-quick tactic. Here’s a chart showing the average time it takes Amazon sellers to turn a profit:
When you start selling on Amazon, chances are that you won’t be profitable right from the start.
You need to spend money on Amazon advertising to make sales. Sometimes, you need to spend more money than you get back.
When you constantly make sales, you’ll automatically rank higher in search results and make passive sales as a result.
From that moment on, your business will (in most cases) be profitable. But you can’t ignore the costs to get there.
We’ll look at the best strategies to promote your product later in this post. For now, just know that you’ll only be successful as an Amazon seller if you’re willing to put in the work up front to promote your product.
Do Product Research
If you’re ready to make that commitment, here is a research strategy that will help you home in on the right types of products for your Amazon FBA business:
Sign up for a free Helium 10 Account. You can also use this 20% discount code for the first 6 months, if you want to use all tools.
Head over to Black Box and open “KEYWORDS”:
Open ADVANCED FILTERS:
You’re now able to filter keywords with exactly those parameters you’re looking for.
The trick is to enter parameters that indicate high demand and low competition.
If you’re just starting, you can use the values below. You can also modify them by +/- 10%:
- Search Volume: 200 – Max
- Revenue: $5000 – Max
- Price: $15 to $50
- Reviews: 0 – 100
- Variations: 0 – 1
- Competing Products: 0 – 200
Now, go through the results and sort out keywords that refer to a big brand. Only search for general keywords.
The first keyword I saw was this one:
What you can see is that top-ranking products for this keyword only have 41 reviews and a rating of 4.1 on average.
When you head over to Amazon, you can see that there are only 36 competing products.
Next, check the whole niche with Helium 10 XRay. You can see that all products have a low review count and a decent revenue:
Looks GREAT!
But you shouldn’t stop here. You have to run all products through Helium 10 Cerebro.
Cerebro is a tool that checks all keywords that products are ranking for on Amazon:
What you need to do is to check if all these keywords are competitive or not.
For example, “lock picks kit” has a total search volume of 354 and 353 competing products.
According to CPR 8-Day Giveaways, you only have to give away 8 products a day for 8 days to rank on the first page of Amazon search results.
Although this strategy is super useful, you should check out our complete guide on what to sell on Amazon for more insights on how to choose the absolute best products.
Calculate Profits for the Products
Based on your research using the strategy above, create a comprehensive list with all your product ideas. The next step is to calculate the exact profit margin for each product.
No matter what you want to sell, the profit margin is crucial to the success of your Amazon business. Here’s a chart showing the average profit margins of Amazon sellers:
Only 8% of sellers say that their Amazon business isn’t profitable yet. Most sellers make profits between 6% and 50%.
That’s GREAT!
Aim for a profit margin of at least 10% for the start.
Here’s how to find out the profit margin of an Amazon product:
1. Sign up for a free Helium 10 account
2. Download Helium 10’s Chrome Extension here
3. Choose a product
4. Check profitability
5. Make sure that the profit margin is higher than 10%.
Calculate Costs for the Promotion
Next, you need to calculate the costs to rank a product on the first page of Amazon search results for its main search term.
You can use the Helium 10 CPR 8-Day Giveaway Score to do that. It shows how many sales you have to make per day for eight days to rank on the first page of search results for a given keyword.
You need to use Helium 10 Cerebro to get this score:
You can sign up here for free or use this 20% discount for the first 6 months:
For example, assume the Helium 10 CPR 8-Day Giveaway Score is 8. That means you need to make 64 sales in 8 days. To be on the safe side, you should calculate your costs for 16-32 days.
To calculate your costs, you need to know how much you have to pay per sale for Amazon advertising.
If you run ads on Amazon, you have to pay per click (CPC). The average CPC is $0.91, while the average conversion rate is 9.58%.
Here’s a great infographic showing these average values:
You need to divide your CPC by your conversion rate to get the cost per sale. Then, multiply this cost by the number of sales you need to make to get your product on the first page of search results.
Of course, you also make revenue when generating sales. You get your real costs if you deduct your costs from your revenue.
Create a Better Product
Amazon’s primary goal is to make the most revenue. They mainly take three criteria into account to determine a product’s ranking in search results:
- Click-through rate
- Conversion rate
- Customer feedback
To get a better click-through rate and conversion rate, you need to optimize your Amazon listing. We’ll talk about the best listing optimization strategies later.
However, to get better customer reviews, you’ll need a better product. Great customer reviews on Amazon are the key to long-term success.
Great product = Great customer feedback = long-term success
It’s not enough to sell an “OK” product. You need to sell a product that blows customers’ minds. To achieve that, you need to understand the Kano Model. It consists of five attributes that influence customer satisfaction:
- Must-be attributes: Basic features that customers only become aware of when they’re not fulfilled.
- One-dimensional attributes: Features that eliminate dissatisfaction or build satisfaction. The more of these features are present, the more satisfied a customer will be.
- Attractive attributes: Provide satisfaction when achieved, but don’t cause dissatisfaction when not achieved.
- Indifferent attributes: Irrelevant features. Customers don’t care if they’re fulfilled or not.
- Reverse attributes: Features that lead to dissatisfaction if present and customer satisfaction if absent.
While must-be attributes and one-dimensional quality attributes are important, attractive quality attributes are the ones that blow customers’ minds.
The best way to find these attributes is to analyze the problems of your competitors’ products. Here’s a great strategy to do that:
1. Sign up for a free Helium 10 account
2. Download Helium 10’s Chrome Extension
3. Choose a product
4. Start Review Downloader
4. Choose “Only Verified Purchase” and <3* reviews
5. Go through the results and find all problems
If you really want to beat your competition, fix these problems with your product. It’ll only make your life easier in the coming months.
How to Set Up Your Amazon Business
Create an Amazon Seller Account
Creating an Amazon Seller Account is very simple. However, there are some essential things to consider. First of all, here’s what you need to create an Amazon Seller Account:
- The legal form of the company
- Business email address or Amazon customer account
- Proof of identity (identity card/passport)
- Bank account
- Credit card
- Valid phone number
Ensure that you have these things when creating your Amazon Seller Account. Moreover, there are two types of seller accounts: an Individual Seller Account and a Professional Seller Account. Let’s take a quick look at the differences between them:
Individual Seller Account
- You can sell up to 40 items per month
- There is no monthly flat fee
- You need to pay a fee of $0.99 per item sold
Professional Seller Account
- You can sell as many products as you want
- There’s a monthly flat fee of $39.99
- You don’t have to pay a fee per item sold
I highly recommend choosing the professional plan. The basic selling plan is only worth it if you sell fewer than 40 items per month.
Choose Your Fulfillment Method
After creating your Amazon Seller Account, you need to choose a fulfillment method. There are two options. You can go for Fulfillment by Merchant (FBM) and store, pack, and ship products on your own. The other option is to use Fulfillment by Amazon (FBA) and outsource all these tasks to Amazon.
Just send your products to an Amazon fulfillment center and they handle the order fulfillment for you.
If you take advantage of Fulfillment by Amazon, you’ll pay more fees than a FBM Seller. Every seller pays referral fees and fees for the Amazon seller account. FBA Sellers additionally have to pay storage fees and FBA fees (fees for packaging and shipping).
Here’s a comprehensive guide about Amazon fees.
Finally, you need to figure out which fulfillment method is more profitable. Therefore, you should use Helium 10’s Profitability Calculator, as shown in the section Calculate Profits.
Keep in mind that you have lots of opportunity costs if you choose Fulfillment by Merchant. These costs are losses that result from not taking advantage of an existing opportunity. For this reason, you have to consider your own hourly rate in the calculation.
Set Up Your Listing
Your listing describes your product to customers. You’ve probably seen hundreds of product listings in your life. Here’s what they look like:
Overall, there are more than 600 million product listings on Amazon.
That means you need to create a product listing that stands out. As a new seller, it will be ten times harder to succeed with a bad listing.
We’ll talk about listing optimization strategies later in this post. For now, you only need to know how to set it up.
First of all, you need a Fulfillment Network Stock Keeping Unit (FNSKU). To get this number, you need a UPC. A UPC is a barcode, like you’ve seen on products throughout your life:
You can buy a UPC on the official site of the GS1. I highly recommend not to buy your UPC Code elsewhere – it only causes problems.
Once you have your UPC, you can create a listing on Amazon, and you’ll get an FNSKU.
Later in this post, we’ll discuss how you can optimize your listing to increase sales on Amazon. For now, here are the basic elements of every Amazon listing:
- Every product page has a product title. Usually, the title includes further details like size or brand.
- Bullet points are the place where you should convince your customers to buy your product. Clearly explain its benefits and most attractive features.
- Answer customers’ most important questions in the product description and explain technical product details.
- Present your product from different angles with your product images.
- Backend keywords don’t appear in your listing, but they’re still important. Add them to your listing so that customers can find your product in the Amazon search results.
Choose the Right Amazon Seller Tool
Helium 10
Helium 10 is a tool designed to assist Amazon sellers throughout their journey. It offers a wide array of comprehensive features, such as product research, keyword analysis, listing optimization, and advertising tools.
Jungle Scout
Jungle Scout is another trusted tool among Amazon sellers. It is particularly known for its product research functionality, enabling users to discover profitable products in various niches with ease. Jungle Scout’s features also include keyword research, sales estimates, and competitor tracking.
AMZScout
AMZScout provides a comprehensive set of tools that are invaluable for conducting product research and competitor analysis on Amazon. With real-time data on product sales, trends, and competitor strategies, sellers gain the insights they need to make well-informed decisions.
Order Your Product
If you don’t manufacture your own products, you need to find a supplier. Alibaba is an excellent point to start your research for manufactures, and there are also great Alibaba alternatives to find quality products.
Let’s say you want to sell drinking bottles. Head over to Alibaba and search for drinking bottles:
You will find thousands of manufacturers:
Go through the list and search for the ones that are best suited for your product. You can also contact suppliers and negotiate with them.
When searching for a supplier on Alibaba, make sure to choose suppliers that have a Gold Supplier Membership.
Also, check how many companies the supplier works with and what these companies say about the supplier.
If everything is fine, you can talk about product changes. Do you want a blue bottle or a red one? Do you need other changes? You have to clarify everything and then order one or two samples.
Once you know all costs, go back to the Helium 10 Profitability Calculator and check your profit margin.
If everything looks good, you can place a bulk order. I recommend ordering inventory for two months.
Why?
Because if your inventory management fails and you’re out of stock, you’ll lose all the rankings in Amazon search results that you gained through promotion. Accordingly, your sales will drop and your hard work will be wasted.
Optimize Your Listing to Increase Sales
Most Amazon customers don’t look past the first page of search results when searching for a product on Amazon, so it’s critical that your product ranks high in Amazon search results. With listing optimization, you can make your product more visible and increase your sales on Amazon.
Keyword Research
First of all, you need to do extensive keyword research. Amazon only indexes your product for a keyword if you mention it in your listing. That’s why it’s really important to know every keyword that can generate sales.
You should also use Helium 10 Index Checker to check if you’re indexed for an important keyword or not.
To find out which keywords are important for your product, you can use the following strategies:
Use Helium 10 Magnet
1. Sign up for a free Helium 10 account
2. Start Helium 10 Magnet
3. Type in a seed-keyword, e. g. “drinking bottle”
4. Get hundreds of keyword suggestions
Read this article here to learn exactly how Helium 10 Magnet can help you find keywords.
Use Helium 10 Cerebro
1. Sign up for a free Helium 10 account
2. Start Helium 10 Cerebro
3. Type in one of your competitor’s ASIN
4. See for what keywords your competitors are ranking for
Here’s an article to learn exactly how to find your competitor’s keywords.
When you’ve researched all the important keywords, it’s time to optimize your listing:
Optimize Your Title
It’s important to make your title descriptive. Tell customers what they’ll get from your product. If you sell products for which technical details are important, include them as well.
For example, if you sell a drinking bottle, you might include the capacity. To get all the relevant information for your product, you need to study your niche. Here are a few starting points to do that:
- Product-specific blogs
- Forums
- Your competitors
Optimize Your Bullet Points
Bullet points are the place to convince potential customers to buy your product.
It’s best to mention the key selling points and benefits of your product in the bullet points. You can talk about technical details later in the product description.
Customers see the bullet points first, and they want to hear how the item will provide value for them, not technical specifications.
According to Invespcro, only 2.2 % of businesses have a useful value proposition. If you’re able to offer clear, compelling value to customers, that’s a great opportunity to separate your listing from the competition.
Optimize Your Product Description
Here’s the place to talk about technical product details. Just imagine: In a retail store, people can always ask someone if they have questions.
That’s not the case on Amazon because there aren’t any employees. If people don’t find the information they need, they will look for it elsewhere. That usually means they’ll also buy elsewhere.
This is another reason why it’s important to study your niche. Here’re a few advanced strategies to do that:
- Check Q&A on Amazon
- Check negative reviews of competitors
- Use Helium 10’s Review Downloader
Optimize Product Photos
75% of Online Shoppers rely on product photos when they decide to buy a product or not. Furthermore, 22% of returns occur because the product looks different in real life.
Therefore it is very important to optimize your product photos. If you’ve great photos, you’ll not only make more sales, you also will get fewer returns. To get the most out of your pictures, focus on these three points:
- Make sure your images are of high quality
- Focus on showcasing the value
- Make dominant pictures
You should also check out our article on how to increase your sales on Amazon to learn more about optimizing product images.
Use A+ Content
Using A+ Content, you can include images to your product descriptions or upload a video to your listing.
Here’s how it looks:
Imagine if you had to choose between two similar products. Would you take the one with video or without?
Most would prefer the product with a video because this gives them a more complete sense of how it works and what it looks like in real life, as opposed to in still images.
Video content can improve your conversion rate by up to 80%. However, to use A+ Content, you need to enroll your trademark in Amazon Brand Registry.
How to Launch a New Product on Amazon
The most crucial success factor for your Amazon business is promotion. That’s why we wrote an entire article on how to launch your product on Amazon.
Our Product Name Generator could be a great help. With our Product Name Generator, you can create a creative product name. This Product Name Generator uses modern AI technologies and is free to use.
Here are the three strategies that can have a major impact on the success of your Amazon product launch:
Amazon Advertising
Amazon Advertising is crucial to your product launch. Keep in mind that your campaign doesn’t always need to be profitable.
Sometimes it can be a smart move to spend more than you will earn because your rankings will increase due to growing sales. Consequently, you will automatically make more sales in the future.
Before starting an Amazon advertising campaign, make sure you have a few reviews. Usually, the fewer ratings you have, the worse your conversion rate will be.
Deal Pages
One of the best ways to promote your product is to list it on deal pages. If you offer your product with a 70% or 90% discount, it will be easy for you to sell it.
A great way to list your product on a deal page is to use Jungle Scout.
Like Helium 10, Jungle Scout shows you how many products you have to give away every day for about two weeks to get in the top 3 of search results.
Here’s what to do:
2. Go to Launch > Promotions tab
Jungle Scout will take you to a dashboard where you can see all your products. Here’s what to do next:
Instagram Ads
Nearly half (49%) of Amazon sellers in 2023 used Instagram Ads, and with good reason. Brands with fewer than 10,000 followers on the platform see an average conversion rate of 1.3%, significantly higher than what you’d expect from other platforms like Twitter or Pinterest.
With over 500 million daily users, Instagram is an ideal social media platform to reach a wide audience and grow your sales on Amazon. Ads on Instagram also tend to have a higher ROI than those on other platforms.
To run ads on Instagram, you’ll need to have a business account. Setting this up will also unlock other helpful features like shoppable posts and Instagram Insights. Here are some other tips to maximize your return from advertising on Instagram:
- Use high-quality and engaging images in your posts and ads
- Optimize your profile to attract more customers and boost sales. This includes using a compelling bio that highlights the value of your products as well as using relevant keywords in your bio and captions
- Use the right hashtags to help customers find you. The same keywords you’ll use on Amazon often make excellent Instagram hashtags
TikTok Ads
TikTok is another top platform for both users and brands in 2024. Surveys show that 97% of TikTok users also shop on Amazon, so you’re likely to reach the right audience by advertising on the platform.
Considering TikTok has over 107 million users, that’s a lot of potential customers you can bring to your Amazon store.
Short content is best to attract attention on TikTok. Videos that show the product within the first 3 seconds get the highest click-through rate, and the videos that perform the best are around 15 seconds long.
Trends move quickly on the platform, so it’s smart to do your research into the content that’s most popular currently. You can also use A/B testing to see what works best for your audience and niche.
With an entertaining ad, a simple and clear call-to-action, and smart use of hashtags, you can dramatically increase your Amazon store’s traffic by taking advantage of TikTok ads.
Influencer Marketing
The great thing about connecting with influencers is that they have an audience already built for you to access.
The key is to find the right influencers for your niche. Bigger isn’t always better: Micro-influencers, or those with between 10,000 and 100,000 followers, have an average engagement rate of 3.86%, more than twice that of mega-influencers.
How effective are influencers at driving sales? According to SproutSocial, 49% of consumers make a purchase that was inspired by an influencer at least once a month. When you advertise your products through the right influencers, you can absolutely see your sales skyrocket.
Of course, that’s the trick: finding the people that your customers are following. You can find influencers by talking to other sellers or people in your industry.
Also pay attention to the names and accounts you see coming up often on social media and check whose posts are trending for the keywords and topics relevant to your products.
How to Get Customer Reviews on Amazon
You get more reviews if you have a better product than your competition. It’s that simple. If you can surprise customers with product quality, they will automatically leave more positive reviews.
We wrote a great guide about how to get reviews on Amazon, which you should check out. Moreover, here are two strategies you can implement right from the start:
Use Helium 10 Follow Up
Helium 10 Follow Up is an email automation tool for Amazon sellers. You can set up an automated email campaign that contacts customers after they make a purchase.
With this email, you can check in to make sure their order met their expectations and ask them for a review.
This kind of proactive follow up can help you get more positive feedback and can also reduce the number of negative comments on your product page since it gives unhappy customers a way to reach out to you directly.
You can learn more about Helium 10 Follow Up here.
Join Amazon’s Vine Program
The Amazon Vine program is open to sellers with Amazon brand-registered products that currently have fewer than 30 reviews.
Vine Voices reviewers are invited to participate in the program based on their reviewer rank, which is determined by the quality and helpfulness of their past reviews.
Here’s how it works:
- Sellers enroll their product with the program
- Sellers submit up to 30 units of the product they want to have reviewed
- Vine reviewers request free products related to their interests
- Vine reviewers test the product and write an honest review
Bear in mind that Vine reviews aren’t guaranteed to be positive. Reviewers in this program are honest, and tend to be very thorough.
This is a good thing if you sell high-quality products because thorough reviews inspire more trust and confidence in customers who read them.
There is a fee to enroll products in the program, based on how many units you submit:
- 1-2: Free
- 3-10: $75
- 11-30: $200
If your product receives no reviews within 90 days, you won’t be charged for enrollment.
Stats directly from Amazon say that 25% of reviews are received within 5 days, and 99% within 35 days, so this can be an excellent way to quickly get reviews on new products.
You can check out this more in-depth Jungle Scout article on Amazon’s Vine program to learn more.
Utilize Product Inserts
Using product inserts is a simple and effective way to get more reviews for your products. When including inserts, make sure to provide customers with helpful information about your product. This could include usage tips, care instructions, or benefits they might not immediately notice.
While you can ask for reviews, it’s important to remain neutral. Avoid any language that encourages customers to leave a five-star review, as this goes against Amazon’s policies. Instead, simply ask them to share their honest feedback.
Additionally, product inserts are a great opportunity to grow your customer base beyond Amazon. Encourage customers to join your newsletter or follow you on social media. This can help you build a loyal audience and make future product launches more successful.
In Conclusion
To summarize what you’ve learned, here are the most important points of this article:
- Selling on Amazon isn’t a get rich quick tactic
- You must sell products with high demand and low competition
- You need to have a budget to promote your Amazon product
- Promotion is important for the success of your business
- Selling a better product than your competitors makes your life a lot easier
- You need to investigate whether FBA or FBM is better for your business
- You need to create a much more attractive listing than your competitors
By keeping these key points in mind and following the tips in this article, you can grow a successful business as an Amazon seller.
