Amazon is the largest American online sales marketplace and is growing in popularity every year. Today, the online shopping giant covers over 49% of the online retail market and 5% of the entire US retail market. It has been compared to a huge shopping center filled with thousands of virtual stores with products of various categories. Why is this platform so attractive to merchants? Because Amazon offers an easy and affordable way to sell products without additional website development costs. Thanks to a well-developed infrastructure, a number of important elements of trade billing and logistics are handled by the company itself.
However, it should be borne in mind that there are about 6 million sellers on Amazon, and in order to achieve noticeable commercial success, it is necessary for the product to have a high rating.
Conversion rate as a factor of competitiveness
Amazon is the 5th most visited site today and is, in fact, a huge search engine. According to statistics, 44% of buyers start searching for a product directly on Amazon, bypassing Google. Many are attracted by the very convenient “one-click checkout” function implemented on the marketplace. The buyer enters the name of the product in the search box and a second later receives a list of thousands of similar products. Some of them are displayed in the first lines of the search results, while others are displayed on dozens of subsequent pages.
It is clear that the goods in the TOP of this list gain a competitive advantage. If you are a seller on Amazon, then you are directly interested in your listing appearing in the top ten search results, as this makes it possible to sell your products faster, which is the cherished goal of everyone who works in e-commerce.
How the marketplace search engine works
For this, the developers of Amazon have created a special search algorithm called A9. It performs programmatic analysis based on human judgment, performance metrics, and key business metrics, of which one-click revenue is the foremost.
As you know, there are 3 interested parties on Amazon: buyers who come for a product, sellers who want to sell the product, and Amazon, which receives a percentage of each sale. The main goal of the A9 algorithm is to encourage people to make purchases constantly and a lot, since the earnings of Amazon itself directly depend on this. The task of the algorithm is to provide the best search results by instantly linking consumer search queries to the most relevant products in the site’s catalog.
The key factors of product listing, according to which the A9 algorithm displays the product on the first page of search results, are:
- conversion rate;
- relevance of the product to the query in the search bar;
- an indicator of customer satisfaction and retention, determined based on an analysis of the behavior of buyers on the listing, including repeat purchases.
Thus, based on the principle of the A9 algorithm, improving the conversion rate can increase the chances of a product getting into the TOP of search results.
Seven effective ways to improve conversions and increase Product Ranking
Among the factors that directly affect conversion, there are seven most significant:
- Best Seller Rank
- Customer Reviews
- Feedback comments and answers to customer questions
- Photo quality
- Price policy
- The time the buyer spends in the listing of the product
- Listing optimization.
By properly setting these seven positions, you can improve conversion and rise to the TOP of Amazon search results.
1. Rating of sales.
Amazon is one of the most customer-centric platforms out there. If a product is not selling well, then the marketplace algorithm drops it to the very bottom of the search results. All sellers on Amazon should be guided by such a parameter as the BSR (Best Seller Rank). It can be found in the Description section of any listing. The lower it is, the better, ideally the BSR should aim for 1 (like a bestseller). A product with a BSR of 20 sells better than one with a BSR of 200.
This ratio can be improved by increasing sales. Periodic promotions, distribution of discount coupons for regular customers, advertising will help to increase sales. For example, when promoting a new product, it is advisable to launch a special price action with a discount of up to 99%. Despite the negative profit, Amazon sees that the number of daily sales compared to competitors is much higher and promotes the product to the TOP of the search. After that, you can set the desired price and start working “in plus”.
Any Amazon seller knows that customer reviews are extremely important in improving product ratings. Moreover, today they quite often become one of the methods of competitive struggle. Even the most ideal product is not immune to negative reviews written by competitors or consumers in a bad mood. Also, keep in mind that Amazon periodically removes suspicious (seemingly fake) reviews. Based on this, it is necessary to ensure that the number of positive reviews always outweighs the number of negative ones.
3. Feedback comments and answers to buyers’ questions in the listing
Advanced Amazonians are well aware of the importance of the “Customer questions & answers” block for raising product ratings, so they often hire professional copywriters who comment on customer reviews and answer questions that arise. In this section of the listing, you can reveal in more detail the features of the product, remove a number of fears and mistrust that may arise among buyers, demonstrate your advantages as a seller, and also improve the CEO by including the necessary keywords and phrases in the responses and comments under the reviews.
4. The quality of the photos in the product listing
Visual content is essential. Speaking about the quality of photos, we mean not only the clarity of the images, but also their maximum information content. Try looking at the photo through the eyes of a buyer. You can place a cross-sectional macro shot of a product to show quality seams or material structure. One of the photos should demonstrate an example of the use of the product, the other – the completeness, packaging, etc. It’s a good idea if the images illustrate the main differences between your product and another similar product. In addition, you can learn from competitors: find the same products and evaluate them. It might even be worth hiring a professional photographer to take quality pictures.
5. Pricing policy
According to research by the magazine Entrepreneur, shoppers are not inclined to trust understated prices and big discounts (as you know, “free cheese is only in a mousetrap”). The consumer always evaluates the goods based on the formula “price-quality”, therefore it is necessary to find a golden price mean, which would inspire the confidence of buyers and not frighten off with too large numbers.
The ideal price should be competitive, adequate in the opinion of the buyer (brand, quality, equipment), and also allow you to earn money. To determine the best price, it is worth conducting marketing testing (A / B testing, Split testing), as well as tracking competitors’ prices. Don’t be afraid to cut your price: in the long run, this can bring more customers.
6. The time that the buyer spends in the listing of goods
One way to keep a buyer on the listing page is to have rich, rich content. This option, called Amazon Enhanced Brand Content (EBC), is provided to registered trademark sellers and enables product listing with built-in layouts.
Benefits of a product page with EBC:
- A more presentational look, reminiscent of a branded landing page;
- Inspires confidence in the buyer;
- Reduces the number of quick exits from the product page;
- Reduces the number of negative reviews;
- Pays for advertising costs;
- Better conversion guaranteed.
7. Listing Optimization
Before deciding to buy, a potential buyer wants to know as much as possible about the product. This is confirmed by one of Amazon’s studies: 85% of buyers study the listing in detail before buying. Therefore, the correct filling of all product pages is a very important factor for improving conversion.
Here are some tips for improving your product listing:
- In the description, you need to indicate the information that is necessary for making a purchase decision.
- Write about the advantage of the product and the benefits it will bring to the consumer.
- Be sure to fill in the required fields in the characteristics: purpose, release form, brand, material, weight, size, color and others, as they are used by the Amazon search engine when the buyer applies filters.
- Structure the text of the description to make the information easier for the buyer to comprehend.
- The title of the page must contain the keys, but not be cumbersome.
- Don’t forget to put your keywords in the Serch Terms line.
- End the description with a call to purchase.
- Periodically review the bestseller listings in your category to incorporate this experience into your writing.
For more information on how to improve product ratings on Amazon, visit our Amazon Intelligence training program, a business training program for the world’s largest marketplaces.
Amazon is the largest online retailer with a huge product turnover, which attracts people from all over the world. Amazon is the 5th most visited site in the US.
As a huge virtual shopping center with thousands of stores offering items of various categories, this platform allows almost anyone to present their product to millions of potential customers. The attractiveness of trading on Amazon also lies in the well-developed infrastructure, thanks to which a number of important elements of trade billing and logistics are handled by the company itself.
Fulfillment by Amazon (FBA) is a special service of the American marketplace that frees the seller from solving many of the mandatory tasks of online trading. As an FBA member merchant, you can sell the product and makes a profit, while Amazon takes over the issues of attracting buyers, storing and packaging the goods, processing payments, and other interactions.
Thus, with a relatively small investment and a well-thought-out strategy, almost any seller can start earning quickly. The key to successful trading is choosing a product that will sell well.
How to choose a product to sell on Amazon
This stage is key since the size of your profit depends on it. A trending product is a source of high income and quick sales. The level of competition in the marketplace allows a beginner to breakthrough. Having a “flair” for a product in demand or an emerging trend, you can very quickly start making good money. The ability to analyze the audience, correctly assess the demand, as well as certain strategic points are the key to successful marketing on Amazon FBA.
Choosing the right niche and the product to sell is the most important stage at the start, on which all other business processes depend. The main thing in successful trading is not a beautiful website and a catchy name of the store (which is also important), but what is sold in it. Hence the question arises: how to define a resonating product, i.e. one that will resonate in the soul of the buyer?
One of the tactical approaches to finding “your” product can be everyday life. Think about what annoys you about the things around you that could make your life easier or more comfortable. The idea can also come from communication with other people. All that remains is to look at the Amazon website to see if this offer is in stock.
Here are a few resources to get your idea of what products to sell from:
- Reviews of popular online stores;
- Blogs on social networks;
- Product reviews on YouTube;
- Amazon Best Sellers category;
- Google Shopping reports;
- Rating listings on Aliexpress and Alibaba.
The evidence of the competitiveness of a product is a large list of large sellers with significant sales or a huge number of positive product reviews. The number of views and comments under the video review of a new product allows you to assess the audience’s reaction to this subject, and then select an inexpensive analog from China for it. Blogs in social networks will suggest new trends and fashion trends.
It is worth paying attention to analytical marketing articles dedicated to the top online selling products. By researching reports from Cloudways or Google Shopping, you can find the categories of commodities that are most in-demand by the consumer.
You can use dedicated software tools to find a profitable product on Amazon FBA.
Here are some of the best ones:
- Helium 10 Chrome Extension – universal software for product search, keywords, optimization and maintenance of Amazon listing.
- Viral Launch is an Amazon product selection tool with search, keyword research, market and competitor analysis capabilities.
- AMZ Scout – Specializes in helping sellers discover a promising niche on Amazon.
- Google Trends – allows you to track the trend of changes in demand. If the product has been known for a long time and interest in it is falling, then selling it through Amazon will be unprofitable.
TOP 5 product categories that sell well on Amazon
From time to time, Amazon publishes a list of its top-selling items. Followise offers a list of five categories, whose products invariably go to the first lines of popularity ratings with a buyer.
1. Baby products and toys
Children are some of the most powerful consumers on the market, so this category has vast potential.
The demand for hygiene for babies, diapers, car seats, strollers, pacifiers, teethers, and other baby care accessories are always in trend in sales on Amazon.
The list of Amazon’s 100 Best Toys for 2020 includes: a Candylocks doll with fragrant hair and included accessories, a set for laboratory experiments from Crayola, drawing tablets, construction sets, puzzles, and interactive toys.
2. Beauty and health
This is a great niche for the aspiring internet entrepreneur. This category sells a huge range of products from organic supplements and vitamins to medical gadgets and health books.
An excellent option is also everything related to the beauty industry: cosmetics, all kinds of technological innovations, massagers that can improve the appearance or slow down aging.
3. Home and kitchen
This niche is ideal as it provides ample opportunity for sellers to expand their business. The category provides high demand, offers many simple products and good pricing.
In this group, sports equipment is always popular. This is due to the popularization of the culture of sports, a beautiful body, and a healthy lifestyle.
Slimming underwear, which is now more and more popular among buyers of all ages, has become a trending novelty. Trade analysts predict that the global market for compression and shapewear will reach $ 5,576 billion by 2022.
Clothes for pregnant women are becoming very popular among Amazon buyers. Maternity clothing category sales growth has consistently increased by 2.01% on average since 2014, according to reports from leading vendors in the market such as Amoralia, Destination Maternity, Envie De Fraises, Isabella Oliver and Mothercare. A key factor behind this is the increase in the number of pregnant women working.
5. Electronic novelties, gadgets, and accessories for smartphones
Headsets, screen protectors, glass for screens, wireless chargers, smartwatches, robotic vacuum cleaners and other useful technological gadgets are selling well.
Innovative applications for smartphones and PCs are also in great demand, such as: tracking physical activity, determining the calorie content of food from a photo, trying on online, choosing a haircut, etc.
Bestsellers among all manufacturers on Amazon in 2020 were the Fire Kids Edition Tablet, the Fire TV Stick streaming media player, and the Echo Spot, Echo Dot, and Echo Buttons line of smart speakers with Alexa voice assistant.
A few tips for choosing a product
In addition to forecasting sales and the level of competition when choosing a profitable product, it is recommended to pay attention to some aspects that can attract or repel a potential buyer.
Factors affecting the demand for goods:
- Low price. It has been found that a $ 15-30 item encourages the buyer to buy impulse. This price gives a high profit with daily sales of more than 20 units. These can be various kitchen accessories or household gadgets that can make housework easier.
- Dimensions. It is known that small-sized goods are in great demand on Amazon. This is due to the ease of storage in the warehouse and low shipping costs. These include personal hygiene items, phone accessories, small electronic gadgets, etc.
- Impact resistance. A simple, less fragile and not subject to breakage is more attractive for sale, since it will most likely reach the buyer whole and in working order. This will avoid returns and conflicts.
- Cost price. Goods with a low cost will not entail significant financial losses when reimbursing cash compensation in case of return. In addition, such products can be used for promotions to attract more customers to the store. This way, a low-cost commodity will work for your promotion on Amazon FBA.
Conclusion: determining a niche and a product that will sell well on Amazon and bring profit is an important stage on which the success of the business directly depends. More details on this topic can be found on the online platform Followise, a business training program at the world’s largest trading floors.
Data Insight predicts that e-commerce will account for about 19% of all retail sales by 2024. Recent world events related to the coronavirus pandemic have contributed to the acceleration of e-commerce growth, especially in online sales on marketplaces.
The popularity of trading platforms is explained by the simplicity and convenience of shopping for customers which increases sales of the store itself. The marketplaces collect products of different categories, from food to electronic gadgets.
The customer does not need to waste time looking for the right things: everything can be bought at once in one place and at the most favorable price.
It is also convenient for a product manufacturer or retail seller to use marketplaces since they have their audience and a well-functioning sales mechanism. There is no need to develop a website design, set up SEO promotions, organize online payments, and deliver the merchandise – all this is taken over by the product aggregator.
Trading on the marketplace is one of the options for scaling a business. Having become a full-fledged launching pad for small manufacturers, online retailers give them a real opportunity to enter new markets, including foreign ones.
Local or international marketplace?
Today, there are more than 150 registered trading platforms worldwide, which cover half of online sales. They both have common features and differences, but how to choose the right one?
The main criteria for choosing a marketplace include:
· number of visits per day;
· a variety of product categories;
· infrastructure and quality of technical support;
· number of suppliers;
· availability of opportunities for purchases by foreigners;
· payment system;
· ease of registration and login/logout.
All commodity aggregators can be conditionally divided into two categories: Local – working only in one country and International, which can be used by sellers and buyers from all over the world. The largest online retailer in the UK is Argos, in France – la Redoute, in Germany – Allyouneed, Indonesia – Tokoprdia, in India – Flipkart, in Russia – Wildberries and Ozon, in Ukraine – Prom and Rozetka, in Kazakhstan – Satu, and Kaspi … The world’s top 20 online retailers are visited by nearly 15 billion people every month.
Global international online shopping platforms include Amazon, PayPay Mall and Ebay, which account for 52% of the cumulative visits to the world’s top twenty marketplaces. For example, in the US, 55% of shoppers immediately search for a product on Amazon or Ebay, without going to Google.
When choosing an aggregator, the seller faces a dilemma of which trading platform to give preference to: local or international.
Comparative analysis of marketplaces (data from 2020)
|Marketplace name||The audience(visitors per day)||Annual turnover|
|Amazon||2,4 billion||$1,5 trillion|
|EBAY||360 million||$10 billion|
|Wildberries.ru||7 million||$1,328 billion|
|Ozon.ru||2,5 million||$796 million|
|Prom.ua||2,6 million||$400 million|
|Rozetka.ua||1 million||$300-400 million|
As you can see from the table, having a huge audience, international marketplaces can provide a seller with more opportunities to sell their products compared to local online platforms.
The advantages of international marketplaces include:
Ø Large customer base: according to statistics, up to 70% of sales made in the United States occur on the Amazon website.
Ø Large market size: with a small investment, the seller gets the opportunity to present his product to millions of potential customers
Ø A variety of products, which allows the seller to occupy his niche and expand the range of products.
Ø Built-in marketing tools providing quality advertising for product promotion.
Ø Brand awareness: sites such as Amazon, Ebay, Etsy do not need to be promoted, they are known to buyers all over the world.
Ø Well thought out user-friendly interface: almost 30% of sellers on Amazon chose this site due to its ease of use.
Ø Convenience of settlements with customers: international online services have a well-thought-out simple system for receiving international payments
A novice seller should pay attention to the largest sites with a presence around the world. They have a developed technological base and have a large coverage compared to local marketplaces.
Today, the most interesting in terms of starting or expanding an online sales business are the largest international trading platforms Amazon and Ebay.
Amazon VS Ebay: what to choose
Amazon and eBay are the American electronic trading platforms with the largest turnover of goods, attracting people from all over the world. They are two huge competitors in the e-commerce space, although their business structure is based on very different positions. Each has its pros and cons.
Amazon works on the principle of a giant online store, in which everyone is allowed to sell their goods. In addition, third-party sellers can use the warehouses of the marketplace, as well as delivery logistics. This site is focused on B2C business relationships (from manufacturer to consumer), where goods are sold at a fixed price.
Ebay is a model of an online auction, where sellers from all over the world are allowed to put up their products for sale, and buyers can purchase them. The task of the marketplace is to provide a transaction protection program. This commodity aggregator works on the C2C principle (from consumer to consumer) and merchandise can be sold both at a fixed price and at a negotiated price.
For clarity, we have summarized the main differences between the two most popular American marketplaces in a table.
|Traffic||#5 Most Visited Sites in the USA||#7 Most Visited Sites in the USA|
|Operation’s principle||Huge shopping center with thousands of virtual stores offering products of different categories||An international internet auction designed to let people trade among themselves|
|Ability to sell goods||Only at a fixed price||On a negotiated basis and at a fixed price|
|Product listing requirements||There are strict rules for the design of photos, descriptions, product characteristics to comply with obligations to the buyer||Simplicity of lot registration according to the parameters from the drop-down list|
|Product promotion||You can not invest in advertising, but use the listing of already “promoted” product groups||It does not work as a catalog; product promotion is required. additional advertising costs|
|Deal processing and logistics||For a certain commission, Amazon takes over warehouse storage (150 warehouses around the world), packaging, barcodes, ordering and delivery of products to the buyer.Also, it engaged in the procedure for terminating the transaction and returning the goods to the seller and funds to the buyer.||Does not have warehouses, all logistics from registration, storage, and packaging to delivery of products, as well as the procedure for returning them in case of a break in the transaction, fall on the shoulders of the seller and under his responsibility.|
|Payment methods for transactions||Payment to a US bank account or Payoneer payment card.||Ebay has its own system for payments PayPal or you can withdraw funds to a Payoneer card.|
|Certificates||For the sale of children’s goods, food, medicines, dietary supplements, fertilizers, cosmetic products, special certificates are required.||Certification is required only if you plan to import a commercial consignment for order fulfillment from the United States.|
Choosing the right marketplace is a crucial moment since the success of your business largely depends on it. You can learn everything you need to know to start, run and grow your business on Amazon in 2021 in detail with our Amazon Intelligence program.
In 2020, many companies are faced with a sales challenge. Unfortunately, the coming economic crisis, due to a number of objective reasons, led to a sharp drop in demand for many goods. Cyclical ups and downs are normal aspects of the global economy, but it is difficult for beginner salespeople to adapt to the new realities of the market.
Solutions need to be found that will respond to current changes in buying behavior and increasing competition. Using certain methods, you can maintain and even increase your profitability, start selling more. Some methods give quick results, others are designed for a long term…
So, how to improve sales in times of crisis, how to retain and build up positions, if conventional marketing techniques cease to bring results? let’s figure it out together.