I have given you a brief overview on how to find a profitable product, how to order the product and how to ship the product into the Amazon fulfillment centers.
Now I will give some advice on how to get your product to actually sell. If you are starting your brand and company from scratch, it can be very hard to get traction in the beginning. Amazon has sooooo many products that it is very easy to get lost in the weeds.
To get started I am going to explain the difference between Amazon ads and sponsored products ads. Amazon ads are ads that show up on Amazon.com and redirect you to another URL. I do not have any expierence with Amazon ads. What I do have experience with, is sponsored products ads. Sponsored products ads show up like this.
(See the products on the right hand side under the “Sponsored” headline.)
Now your new product and brand has a chance to be on the front page when someone searches even the most generic and competitive terms like “HDMI”.
One reason that I have been so successful with Amazon sponsored products is because I have expensive products. My products average over $100 each. This gives me a ton of wiggle room since I have an average 20% profit margin.
I sell a lot of different types of products. Some are much better then others for sponsored products. I sell dozens of products in the $1,000 range. They make no sense for sponsored products, because no one impulse buys a product for a grand.
I also have a bunch of products that are in the $15-$20 range. They seem to sell very quick using sponsored products ads.
Though they have great sales velocity, the ACoS (Spend divided by Sales) was very high in the 20%-30% range. I already have a tiny profit margin on sub $20 products, so it was not worth the spend on sponsored product ads.
I started doing sponsored ads on 11/03. I set the budget at $200, set it on automatic targeting, and set the default bid to .52. I let the ads run for two weeks. Next I went through all my products and paused the ad campaign on weak performers. I ended up pausing the ad campaign of around 60% of my +1600 listings. Some products didn’t get any sales. Of the products that did sell here are my worst performers.
As I went through product by product victories seemed random. I expected some products to be great for sponsored products ads and they ended up being busts. Other products turned out to be all stars when it comes to sponsored product ads. Here are some of my best results:
In the end, I have had a lot of success getting sales and ratings on my new private labeled products using sponsored product ads. It helps that I am in a low competition niche and have expensive products. I would suggest sponsored product ads to anyone with new or expensive products. If your product is under $15 it may not be worth running an ad campaign.