Listed on Amazon but struggling hard to make money? We always stated that selling online and making a profit are two different things. The time you get listed on e-marketplaces, you are an online seller but that doesn’t assure profit because the former needs a well-planned strategy.
And even though the seller store fronts of Amazon have recently been updated to help dropshipping entrepreneurs in customizing their branding, the ultimate success highly depends on how you select a profitable product to sell.
Believe us, selecting the most profitable products is like writing your list for Christmas gifts. There are a lot of options but those you are longing badly tops the list. Though it’s a No.1 challenge for new sellers who want to start with small investments, it needs no numbers-driven data or any long written strategy.
All you need to do is to make a very simplified list of key criteria for selecting a product that has the potential to make the profit. We often get queries about the selection process. However, the strategy is well explained in our modules, we thought of briefing it to help you remove the clouds of confusion.
Step 1: List the Criteria for a Profitable Product
Since you are a new seller, we suggest you start with one niche product so as to capture a specific customer market initially.
- Your product should be small and light to be easily picked up and packed. Since most of the products are manufactured in China, you need an item that is easy to handle, can ship in bulk at less cost and meets the good quality standards. Moreover, it will save your storage, shipping and return cost.
- The product should remain in demand throughout the year. For example, though iPhone 7 accessories have a great price they will have an ever decreasing base of buyers over time. Similarly, seasonal items such as Valentine’s Day gifts won’t be a good choice.
- You should also look for products in the local market for a higher response. This way you will have higher chances of getting business from your local area and will also build up the brand value.
- Keep the price moderate. There are two reasons for this. First, being a seller, you have to ensure your margin even after discount. Secondly, the price should correlate with the quality. People usually don’t buy things over INR 2,500 online. Similarly, they are not very sure of products with cheap pricing. We always suggest sellers keep the price between 300-500.
- One more important factor is to ensure that the product should not be dominated by any known brand. If so, your product will always be compared with the brand and chances are that it may lose the race.
- Since it is your first product, it should be capable enough to generate the market for future products. So when choosing a product, consider the market and future opportunities you could capture in future. For instance, if you have selected ‘charm pendants and necklaces’, you can later introduce ‘charm bracelets’, matching earrings and more. Thus, the expansion will be easier and more connected.
Step 2: Research the Online Market
It might look overwhelming initially but by spending some time on the marketplaces, you will have an insight of the best sellers.
- Carefully analyze the multiple categories appeared in searches and evaluate what items or categories have a high ranking.
- We have practically explained how you can gauge the demand and search ideas in our modules. In short, look for products that are top sellers in subcategory but ranks higher in the main category. Precisely, the ranking should be above 100.
- When you have a few products on the list, check how your competitors are doing. If they have over 200 reviews, selling a similar product will be tough. So avoid the item.
By this kind of sorting, you will be able to figure out the most profitable product to sell on Amazon.
Since you are a new seller, your product will be your brand identity. When you select any random product, despite all your efforts the chances of losing money will remain higher. It is because the product is not what people want. With some research, you can lay down your hands on the perfect item that can fulfill your sales goals and create a good brand identity.