Product research criteria to determine likely profitable products to sell on Amazon.
Product Research is the First Step
The first step to selling on Amazon is to perform product research. Don’t put the proverbial cart before the horse and decide to sell a product without doing the necessary product research. Your Amazon selling profitability depends on how well you assess consumer demand for that product, its associated carrying costs, supplier reliability, and quality.
So before you start listing, let’s take a look at how best to find profitable products to sell on Amazon:
- Ways to get product ideas for products
- Understand what product research is
- How to conduct product research
Ways to Get Ideas for Products to Sell on Amazon
Before you even get started doing your product research, first ask yourself the kinds of products are good for you to sell on Amazon? Here are some ways to brainstorm ideas.
What Interests You?
Many successful Amazon sellers started as hobbyists, selling items they were enthusiastic about—books, memorabilia, or autographs for example—that eventually became businesses. The adage for authors is to “know what you write.” For Amazon sellers, it is “sell what you know.”
What Can You Do Better?
We’ve all been frustrated with a product that doesn’t quite work as advertised. If you’ve ever thought that someone should fix a product’s obvious issues, that someone could be you. Building a better mousetrap is a good way to sell mousetraps.
A trending product may be a bandwagon you want to jump on. Be careful here, though. Today’s hot product could be tomorrow’s version of Beanie Babies. This is why product research is so important.
What is Product Research?
All of the above ideas are good starting points to consider what products you might want to sell on Amazon. But a good idea in and of itself doesn’t always translate into a successful product launch.
As the good folks at Infiniti Research point out, “If any business has plans to launch new products or services in the market, they should never just hire a few people, put in some information, and carry on with whatever seems good.”
This is where product research comes in.
Product research collects data about potential product demand and competitors, as well as, most importantly, pricing that assures profitable margins competitive with other sellers consistent with consumer quality expectations.
What Product Research Determines
Here are some key criteria to research about a product for potential sale on Amazon:
- What’s the likely demand? Is it seasonal, driven by current social or economic conditions (the pandemic is a great example), something steady if in low quantities?
- What’s the best price point? How much does it cost to manufacture your product, maintain a certain reasonable level of inventory to meet anticipated demand, and still make a reasonable profit?
- What is your potential competition? How might your product compete based on price, feature/functions, color options, and/or usability?
- How easy is it to obtain and supply products? And how reliable are your suppliers? New Amazon sellers are advised that simpler and reputable is better. As we are seeing during the supply chain disruptions of the pandemic, there’s not much profit in selling a product you can’t supply.
- Related to the issue of supply is whether you want to manage fulfillment on your own or FBA (Fulfillment by Amazon). If you’re new to Amazon selling, FBA is probably the better option. Even large experienced sellers use FBA to take advantage of economies of scale using Amazon’s advanced logistics network.
- What are your shipping costs? The larger and heavier your product, the higher it costs to inventory and ship. New and inexperienced Amazon sellers are advised to first consider smaller and lighter products that are easier to inventory with lower shipping costs.
- How perishable is the product? Products such as vitamins and certain grocery items have expiration dates, but also profitable margins. How confident are you that you can supply products well in time of product expiration?
- How complicated is the product? The more complicated, the more potential points of failure. Unless you have a reliable manufacturer noted for high-quality production, over-complicated products that fail upon delivery lead to customer dissatisfaction and poor brand reputation.
- What are the product reviews of similar and related products? Could be that poor reviews might indicate an opportunity to provide a better product. Though it could also mean a product you want to avoid.
How to Perform Product Research
Google (or whatever your search engine of choice) and Amazon itself are of course primary tools to perform this research. Also be sure to check out Shopify, eBay, and other eCommerce sites to get a feel for product categories and customer reviews similar to what you are considering to sell.
Social media is a great way to test a product idea. Post a survey to your Facebook page or Twitter account, and/or send the survey to an email list. The survey can pose such questions about potential interest in a particular product, what consumers are willing to spend for the product, and, perhaps best of all, obtain email addresses of those who want to stay informed about when such a product is available for sale.
Also, check out any number of Search Engine Optimization tools that help you gain insight into what’s called organic (meaning not as the result of advertising) traffic for products and competitive sellers. It also helps you determine keywords you’ll need in your product listings consumers most likely search for.
Think with Google is a free tool that, well, helps you think about product trends and search categories. You can even subscribe to get weekly email updates. Given that Google is the top search engine for consumers, we think this is a must-have to get a pulse on top trending product categories.
Researching a profitable product to sell on Amazon is of course just the first step. Like any business, online or not, there’s a lot to manage. Fortunately, there are a variety of software tools to help you not only perform product research, but a full range of marketing, inventory, and accounting functions.
For Amazon FBA sellers, GETIDA’s robust auditing software keeps track of your Amazon FBA inventory transactions, refunds, seller data analytics, and FBA reimbursements easily and clearly.
Once you’ve completed your product research, take a look at GETIDA to see how you can grow your business with zero risk.
Get $400 in Free Amazon Seller Refunds with GETIDA.