Amazon - Selling Your Stuff: Marketing & Relevancy

Chris McMullen

• Publisher: QuickStudy Reference Guides
• Year: 2018
• ISBN:
  9781423237457
• Topic: Business
• Subtopic: E-Commerce
• Index: Business

Start selling and boosting your sales in the world's largest and fastest growing marketplace. Clearly and concisely organized in 6 laminated pages, you will find out what to sell, how to sell, and how everything from shipping, discounts, and returns will affect your profit. Our expert gives examples, pros and cons, and tips and tricks. Know what fees will be charged and what options you have, plus - how you can boost discoverability and relevancy of your stuff (the gold standard on amazon). Suggested uses:
• NEW Sellers – learn to sell new products you create or that you buy and resell, like used books
• Experienced Sellers – already using Ebay, Etsy, or Craigslist? Know the details so you can add the largest online marketplace to your list of stores
• Already Selling on Amazon – take your selling to the next level and boost relevancy and sales, while knowing the pros and cons of growing your business on Amazon

Determining Profit vs. Cost

Researching Your Market Market & Selling Potential

Assess market potential by browsing for similar products on Amazon:

• Explore the top sellers in your potential subcategory (e.g., Electronics & Computers > Camera, Photo & Video > Underwater Photography).
• Search for popular keywords (e.g., cameras) and key phrases (e.g., underwater video camera) related to your potential products.

Assess selling potential:

• Amazon.com sales rank: Products with a lower overall sales rank sell better.
• Category visibility: Browse through your potential category and the relevant subcategories. How far must you scroll to find products similar to yours? Customers who browse categories are more likely to purchase products higher up on the list. But keep in mind that some customers use keyword searches instead.
• Keyword search visibility: Search for a variety of keywords (e.g., golf) and key phrases (e.g., golf for women) relevant to your potential products. This can help you assess your chances of having your product listing show up in popular customer search results.
• “Customers also bought” lists: Each product page shows similar products that previous customers have purchased. These lists help customers discover other products. If a product is prominently featured in these lists, that product gets improved exposure.
• Customer reviews: Amazon customer reviews can help you assess how popular various products are. This method isn’t foolproof, so you should weigh customer reviews along with other sales indicators.
• Selling price: Look at how much other sellers are charging for similar products. This will help you gauge your potential profit margin. Note that products in better condition may sell at somewhat higher prices.

Competition

• How many product listings are there for products very similar to yours?
• How many marketplace sellers are there for a given product listing? For example, if there are 2 new and 5 used offers available on a product page, it has less competition than a product page with 16 new and 74 used offers.
• Competition shouldn’t necessarily be a deterrent; it may be a sign that a product is very popular. A product that sells better may make up for increased competition.
• Lack of competition isn’t necessarily a sign that a market has no audience. Sometimes, a hot niche market has a product that is very hard to get.
• Ideally, you want a reasonably popular product for which the market isn’t saturated, or a hot product that is hard to get.

Returns & Exchanges

• You must allow for a small percentage of possible returns and exchanges when estimating your profit versus cost.
• Many returns result in a partial or full loss. For example, suppose that a customer receives a defective product and requests a replacement. Effective Loss = Cost of Product + Shipping/Packing Expense. If you want the defective item returned, the return shipping adds to your loss, but if you can receive compensation from the manufacturer or repair the item for resale, this reduces your loss.
• A restocking fee is permitted in some out-of-policy cases, depending on the circumstances and return policy, though many sellers are strongly oriented around customer satisfaction.
• A few kinds of returns don’t result in a loss. These include cancellations issued before an item ships and returns where the customer pays the return shipping charges (depending on the return reason and return policy) and the item is recovered in its original condition.

Shipping Options Comparison of Shipping Methods

• Merchant shipping: Seller ships the item directly to the customer; seller handles customer service and returns.
• Fulfillment by Amazon (FBA): Amazon packs and ships your orders. Pros & Cons
• With merchant shipping, you incur packing and shipping expenses but earn a shipping credit and save on FBA fees. You handle your own inventory.
• With FBA, Amazon stocks your inventory, packs and ships your orders, and handles customer service and returns. Customers can qualify for free shipping (e.g., with Prime). The con is that you pay FBA fees (e.g., storage space).
• While FBA offers many benefits, the risk is items not selling enough to compensate for costs. More frequent sales or higher profit margins can better accommodate FBA expenses.
• You may be able to price your product somewhat higher using FBA, because some customers will qualify for free shipping. For example, if another merchant sells a product for $7.99 + $3.99 shipping, you can sell the same item for $9.99 with FBA at a potential savings of $1.99 for the customer.

Merchant Shipping Expenses

• Weigh your shipping credits against shipping expenses:
  • Packing supplies such as boxes or mailers, packaging (peanuts, bubble wrap), packing slips, packing tape, mailing labels, and printing costs (ink cartridges, printer wear)
  • Shipping charges such as tracking information (included free with some shipping methods) and optional insurance
• The actual cost of shipping may exceed the shipping credit, especially when you factor in packing supplies. You are expected to ship an item even if the shipping credit doesn’t cover your shipping expense.
• Media items (books, music, videos, DVDs, software, and video games) receive a fixed shipping credit. For items that tend to be heavy, such as textbooks, the shipping credit is less likely to cover your actual shipping expense (account for this when setting your price), even when you use the USPS Media Mail rate.
• Shipping rates often vary by location. Plan for the worst-case scenario.
• Some products, such as DVDs, are all about the same size and weight, which makes it easier to plan for shipping costs.
• If you’re eligible for two-day shipping or international shipping, research the shipping costs to see if you can afford the possible shipping expenses (compared to the shipping credits).

FBA Expenses

• Shipping to Amazon: You incur packing and shipping expenses to ship your products to Amazon’s warehouse. You can use Amazon’s discounted shipping or select your own carrier.
• FBA fees: These cover the cost of storage space and order fulfillment. There are longterm storage fees for products that don’t sell. FBA fees include the...