Amazon presents a compelling business opportunity to all aspiring entrepreneurs.
For proof, consider the sales statistics from 2019. A staggering 225,000 sellers generated over $100,000 in sales on the platform that year, and 15,000 US businesses broke the $1 million mark. Given the company’s continued growth, it’s reasonable to assume those figures have only increased in the years since.
The incentives don’t end there though. Thanks to the Fulfilled by Amazon (FBA) service, sellers can also outsource the vital yet time-consuming tasks of storing, packing, and shipping their wares. With Amazon handling everything, it’s never been simpler or more convenient to sell products for a profit.
However, the very first step to success is finding something to sell.
And, given Amazon’s never-ending catalog of gizmos and gadgets, that crucial task is often easier said than done. In this article, we’re going to reveal the secrets behind effective Amazon FBA product research to help you find profitable items to sell.
What Is Amazon Product Research?
As the name suggests, Amazon product research is the process of finding products to sell on Amazon. The aim is to gauge a product’s capacity for driving sales and turning a profit before committing resources to it (i.e. buying stock).
You analyze market trends and assess the potential profitability of each option rather than throwing capital at items and hoping for the best.
Done well, the would-be seller walks away with an understanding of various key metrics. These include the size of the market, the amount of demand, the cost of sourcing each item, and the profit margin upon making a sale. Thorough Amazon product research also reveals how consumer interest/demand changes over time.
Why is Amazon FBA Product Research Critical for Success?
Amazon product research is important because it helps you make informed decisions about which products to sell. When it comes to succeeding in e-commerce, Amazon product research is a critical step that cannot be overlooked. Finding the right product to sell on Amazon can be the difference between failure and success, which is why it’s important to take the time to research potential products before making an investment. By doing good research, you can identify profitable niches, and avoid products that are too competitive or have low demand.
How to Conduct Amazon Product Research?
Conducting Amazon product research involves several steps, including:
Identifying Your Target Market
The first step in conducting Amazon product research is to identify your target market. This involves understanding the demographics, buying behavior, and pain points of your target audience. Understanding customer demand is also key to success on Amazon. Sellers must research their target demographic to determine what types of products they are most likely to purchase. This will enable them to create product listings that are tailored to their target audience and maximize the chances of their products selling. You can use tools such as Amazon’s Best Seller List and Amazon’s Customer Reviews to gather this information.
Analyzing Product Demand and Market Trends
Once you have identified your target market, the next step is to analyze product demand and market trends. This involves studying the sales volume and trends of products in your niche. You can use Amazon’s Sales Dashboard to get an accurate picture of product demand and market trends.
It’s also important to research the product’s sales history. This will give you an idea of how popular a product is and whether or not it’s been selling regularly. If the product has been selling steadily, then it may be a good choice for you to pursue. On the other hand, if the product has seen a decline in sales, then it may be a sign that it’s time to look for a different product.
Evaluating the Competition and Identifying Opportunities
Evaluating the competition is crucial in Amazon product research. By evaluating the demand for a product, analyzing sales and pricing trends, and researching pricing trends, you can make sure that you’re making an informed decision about what to sell on Amazon. It helps you identify gaps in the market and opportunities to launch a product that meets the needs of your target audience.
You should also research pricing trends. This will help you determine what the average selling price of a product is, as well as what prices other sellers are charging. By understanding the pricing trends, you can make sure that you’re charging a fair price for your product so that you can make a profit.
Conducting Keyword Research and Analyzing Product Listings
The final step in conducting Amazon product research is to conduct keyword research and analyze product listings. This involves finding keywords related to your product and analyzing the product listings of the top-ranked products in your niche. You can use tools such as Keyword Tool and SellerApp to conduct keyword research and analyze product listings.
Top Amazon Product Research Tactics
Having been through the definition, let’s turn to how to research products for selling or reselling on Amazon. In reality, there are numerous approaches to consider – a selection of which we’ll discuss now:
1. Use a Product Research Solution
The simplest (and arguably most effective) method is to use an Amazon research tool. By showing past sales data from actual Amazon listings, these clever pieces of software help expedite the search and remove the guesswork from proceedings.
Expect to gain a quick and clear understanding of the 2 key elements of viable products: how popular they are (i.e. how much demand there is on Amazon) and how much competition there is from other sellers. Overall, identifying quality products becomes less time-consuming, less risky, and more fruitful.
Algopix is one example of a product research solution you could employ. An all-in-one market intelligence engine, it’s been empowering sellers to make data-driven decisions since 2016. Boasting real-time marketplace data and a commitment to innovation, it’s no surprise that 71,000+ users now trust it to analyze possible products and help them find the next big opportunity on Amazon.
2. Conduct Manual Searches
While research tools make the process more convenient, they’re certainly not essential. Searching for product opportunities manually is also an option – despite being more time-consuming and less data-rich.
For example, why not consult the Amazon Best Seller lists? Here you’ll see the bestselling products across a given time period, as well as “movers and shakers”, and “most wished for” items. Each of these categories can provide invaluable information on high-performing products.
Be wary though. While the best-seller lists reveal the top 100 best-selling products in a given category, they’re usually incredibly competitive too. With so many other business owners selling them, it’s harder to forge your slice of the market.
The secret to success is taking a narrower (i.e. more “niche”) approach and delving into the subcategories instead. By checking the top 100 products in the “Fragrance” section of “Beauty & Personal Care”, for instance, you’ll find products that aren’t as competitive but remain popular.
Don’t forget to look at the “Customers Also Bought” and the “Frequently Bought Together” sections on Amazon either. Both features are oriented toward Amazon customers, but say a lot about their buying patterns in the process.
3. Check the Competition
Competitor research is another worthwhile strategy to employ when conducting Amazon FBA product research. It’s also straightforward! All you have to do is check which products in a given niche have “sponsored” written next to them.
That word means the seller is using Amazon PPC to market the product, which in and of itself suggests it’s profitable. After all, if it wasn’t, then how else could they justify spending money to promote it in an ad campaign?
Once you’ve checked which products have been sponsored, you could then validate their potential by referencing free tools, like Google Trends. This useful resource shows in a graphical form how popular a search term has been over a particular time frame. You’ll be able to a) see how many people have looked for the product (albeit on Google) and b) verify any seasonal effects on demand.
Product Research Tools To Find Best-Selling Items on Amazon
While manual searches and competitor research both have their place, we recommend using a purpose-built software tool. As discussed, they deliver quick, detailed, and more accurate results, thereby improving your chance of selecting winning items to sell.
Algopix is the industry standard for product research. Offering intelligent analysis of demand, alongside cost breakdowns and price recommendations, you’ll end up with all the data necessary to make an informed decision.
A robust tool, it turns an otherwise laborious and complex task into one that’s quick and easy. Sellers benefit from actionable information, automatic updates of buy-and-sell data, and key insights on everything from fees to the amount of competition.
Click here to learn more about Algopix and the price plans at your disposal.
Start Conducting Amazon FBA Product Research
There’s no denying how attractive Amazon selling can be from a business perspective. A vast marketplace with a global audience and copious amounts of demand, almost anyone can create an online store and start turning a profit.
Like any business, though, success is never guaranteed. And one of the main obstacles to overcome is finding the right product(s) to sell.
If you know the struggle, then we hope these insights on Amazon FBA product research have proved useful. Keep them in mind, put them into practice, and it shouldn’t be long before you’ve found a first-rate product to begin your FBA journey.
Would you like to see exactly how Algopix can help in that endeavor? Click here to set up an account and start your free trial.