If you’re in e-commerce or plan to be, Amazon is a platform you cannot ignore. Currently, Amazon’s market share in the United States for 2020 is 39.5% and may reach 40.4% in 2021. Those numbers go up in some categories, particularly books, music, and videos (83.2%) and toys and hobbies (46%).

Despite the negative press that Amazon has been getting of late due to its treatment of sellers, the truth is the platform dominates the e-commerce world. Aside from its massive reach, there are other reasons why you should sell on Amazon.

If you’re worried about cloning or losing the market traction you already have on your branded website, don’t be. There’s nothing in the rules that says you must only sell on Amazon, after all. With the right Amazon sales strategy, you can sell on Amazon and your branded website and retain complete control over what you sell.

Key Takeaways

  • Amazon had 39.5% of the online retail market share in 2020, and it’s projected to rise to 40.4% in 2021
  • Selling on Amazon is an excellent way to increase brand recognition
  • Product selection is a critical factor for success as an Amazon seller
  • Becoming an Amazon seller isn’t an end-all, be-all situation
  • If you don’t sell your branded products on Amazon, someone else will

What Is the Amazon Sales Process?

Setting up the Amazon sales process is much like setting up any other online store. You can register on the platform as a seller if you have the following:

  • Bank account (you’ll need the account and routing numbers)
  • Credit card
  • Government ID
  • Tax details
  • Phone number

Once you register on the seller platform, you have a choice to sell as an individual or professional. As an individual, you don’t have to pay anything until you sell something. If you do, you pay 99 cents per item.

As a professional seller, you pay a monthly fee of $39.99, but you’re exempt from the subscription fee per item. You can change your selling plan at any point.

However, you may need to pay other fees, depending on the product you’re selling. These may include:

  • Selling fees
  • Shipping fees
  • Fulfillment by Amazon (FBA) fees

Many people complain about the fees they must pay to sell on Amazon. Selling on Amazon isn’t cheap when you add up all the fees.

However, the primary benefit of selling on this marketplace is that you get access to its 310 million active customers. This benefit far outweighs the cost.

When you sign up as an Amazon seller, you need to start selling something. That means listing your product by either matching an existing product or creating a new listing if you are (hopefully) the first one to sell that product. If you create a new listing, you may need to purchase a unique product code or UPC unless you get an exemption.

To post your first product listing, you’ll need the following:

  • Stock-keeping unit (SKU)
  • Product title
  • Product description with bullet points
  • High-quality product images
  • Relevant keywords and search terms

The next part of the Amazon sales process is to choose the shipping method. You can decide to self-ship (Fulfilment by Merchant) or have Amazon do it for you, or FBA.

You usually pay a flat fee for FBA, but they can get relatively high. Do some comparison shopping by connecting with third-party fulfillment services to help you decide if you should go the FBA or merchant fulfillment route.

Source: ShipBob

With everything set up, all you need to do is wait for your first sale.

Why Is an Amazon Sales Strategy Important?

Selling on Amazon as an extension of your branded e-commerce site is an excellent idea. Amazon can help create brand awareness for your site faster than if you were to do it from scratch. Once you establish a customer base for your brand, they’ll follow you outside Amazon.

You’re up against some stiff competition for attention. There are more than 1.5 million active sellers on Amazon today. Therefore, you need a robust sales strategy to avoid getting lost in the crowd.

A sales strategy will allow you to maximize the exposure value of being an Amazon seller. It’ll also help you ease into the market without too much disruption to your primary business. Let’s look at some of the most popular Amazon sales strategies.

Top Amazon Sales Strategies?

Over its lifetime, Amazon has had more than 6 million sellers on the site. However, only 25% of those sellers continue to sell actively on the platform.

The reasons for sellers leaving the platform are varied. Some big brands don’t want the hassle while others are unhappy with the aggressive way Amazon pushes its private white-label brands.

Other reasons include high fees, the inability to control marketing, and the proliferation of counterfeit items on the platform. However, with the right sales strategy, you can avoid all that and still take advantage of the benefits of selling on Amazon.

Pick One Product

Whether Amazon is your main selling platform or an extension of your website, you must choose the first product to list carefully. Keep in mind that you’ll need inventory when you sell on Amazon, which means a significant investment in that product unless you’re dropshipping.

Do thorough research on Amazon. This will require you to go to the Best Sellers page, click on the relevant categories, and then subcategories.

The top-ranking products or low best seller rank (BSR) typically dominate the class, so they’re a good template for product descriptions, price range, and so on. Make a list of products you think have a good chance of getting traction.

Remember that Amazon has its own search engine, so the keywords you want to use won’t necessarily be what keyword search tools aimed at Google and other search engines will provide. Use keyword search tools primarily aimed at Amazon not only to find products but to optimize your content as well.

Ahrefs Dashboard
Source: Ahrefs

Do A/B Testing

Just because you chose one product for your first listing doesn’t mean you have to stick to it. Rarely do sellers hit the jackpot on their first try. If your product isn’t selling well on Amazon, cut your losses and try other products on your list. If you find one that starts to climb the ranks for your category ― Amazon will assign a BSR to a product on its first sale ― then chalk that one up for the troops.

Stay Cautious

Amazon is an excellent platform for selling, especially if you’re new to e-commerce. However, it isn’t a good idea to go the whole hog until you understand Amazon’s sales process fully as a seller on the ground.

List just a few of your products to test the waters and see if you like the experience. If you register as an individual seller, you pay nothing until you get your first sale, so you have nothing to lose.

You can always change your selling plan if it seems like you can sell more than 40 items. When you feel comfortable dealing with the bag and baggage of selling on Amazon, such as processes, fees, and requirements, you can consider selling more of your popular branded items on the platform. If you feel this will take away from your own site, it might help to remember that if you don’t sell it on Amazon, someone else will.

Listen to Feedback

One of the best and worst things about Amazon is customer feedback. You’ll get a ton of it if your products are selling well, although it won’t always be positive.

Whatever the case, use the feedback to improve your products or how you sell them. For example, if you sell 1-pound bags of coffee and your customers like it but wish you would sell it in larger or smaller quantities, make it happen.

What Should You Do Next?

Selling on Amazon is an excellent idea if you’re new to e-commerce, desire to increase your brand recognition, or want to be the first to market a unique product on the platform. It takes a lot of work to get started but, with the right Amazon sales strategy, you should reap many of the benefits the platform has to offer.

Frequently Asked Questions (FAQs)

What type of product should I sell?

Whatever your category, you should only sell high-quality products. That way, you get fewer complaints, negative feedback, and returns. The price point is still important, but people on Amazon generally look for good products, not bargains.

How much should I sell my product?

That depends on your situation. If you have a branded website selling the same product, you don’t want to undercut your own business by selling it for less on Amazon. Meanwhile, you need to have competitive pricing to qualify for the coveted Buy Box. For a satisfactory middle ground, use the Amazon pricing strategy to revise pricing on your website.

What are the signs I should shut down a product listing?

Poor sales are the most obvious sign that you should remove a product from your listing and make way for another one. However, you don’t want to wait for that to happen if you see the writing on the wall. One would be sinking BSR despite increased sales, meaning the competition for the product is rising. Another would be the waning of a trend you’re on, which means you should stop replenishing your inventory and be ready to jump ship.

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