Inside Amazon Marketplace, The Wild West of E-commerce

The statistics for how big the Amazon Marketplace is, are staggering:

  • Contributes $135 billion to Amazon’s own sales
  • By 2020, this will grow to $259 billion
  • Although there are estimated to be 5 million sellers, only 100,000 of those make $100,000 or more a year (only 2%)
  • A mere 10,000 make over $1 million+ a year (that’s right, only 0.2%)
  • 33% + of sellers on Amazon are based in China

Without a doubt, this sub-culture of business is huge.

So how does it work? Is it easy to become a seller?

Actually, very easy (which probably explains why so few sellers choose to make a living on the platform).

The process goes something like this:

  1. Setup Amazon Seller Account
  2. Add Fulfillment By Amazon to your account (they handle storage, shipment, and customer service for your products)
  3. Package your goods into individual boxes
  4. Go to Amazon Seller Central and “Add a Listing”
  5. Create an ASIN page and add product descriptors & images
  6. Catalog are your boxed items
  7. Setup shipment
  8. Print labels
  9. Mail your items
  10. Track shipments
  11. And you’re done!

Or you’ve only just begin.

The real challenge with being a seller on Amazon is NOT inventory management, taxes, or profitability, but marketing.

Think about it.

If there are hundreds of other merchants selling bamboo straws, who have hundreds of reviews, high search rankings, and competitive pricing, your saving grace will be incredible marketing, not an incrementally better product or price.

As most Amazon sellers know, the cornerstone for all marketing on Amazon starts with Sponsored Products, or pay per click campaigns that promote your product at the top of search results.

By selecting and “bidding” for relevant keywords, you increase the chances of prospective customers seeing and buying your item.

This is a great way to start selling some units, garnering reviews, and slowly increasing your organic ranking. Think of this as a nitrous oxide to give new products the boost they need.

And then you need to start getting creative. Some quick boosting tactics off Amazon include:

  • Search engine & Facebook Ads to reach new customers and retarget past
  • Content marketing through social channels and a blog
  • Influencer marketing: asking seasoned bloggers to review or plug your product
  • Email marketing to your growing mailing list
  • Hosting a giveaway or contest

But if you’re serious about being a seller and in it for the long game, what will be most important will be seeing the trees for the forest and strategizing growth by understanding your customers and competitors.

Your customers in 1) having a clear narrative of their journey to and after your product, and 2) in surveying and understanding their wants and needs (so you can constantly optimize and refine your product offering or even product copy and images).

And understanding your competitors by doing the unthinkable: purchasing their product and analyzing what makes it incredible so you can borrow the best parts and apply it to yours.

This topic is a can of worms, so if you’d like to learn more please message me directly or comment below.

I had the pleasure of consulting for a successful Amazon seller this year and learned plenty of marketing smarts along the way that I’d be happy to share.


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