Wed, 28 October 2015
One of the most difficult and time consuming parts of setting up a private label Amazon sales business is product selection. What are things you should do when picking a product to private label? More importantly, what are the things you should NOT do? On this episode of the Amazing Seller Scott’s going to walk you through 3 of the most commonly made mistakes when it comes to product selection. With each of those points he’s going to give you the details of what the mistake is, why it’s a mistake, and how to avoid it. Can you see how valuable this episode is going to be? Make sure you set aside some time to listen.
Depth of a product market is huge. What is it and how do you figure it?
If you are considering a product in a certain area you need to assess what Scott calls the “depth of market.” What is that? It’s a way of gauging the demand for a product to see if there is enough room for you to insert another variation of that product into the mix and have a chance of making enough profit. Figuring the depth of market has to do with analyzing the top 10 selling versions of that product and getting the average sales volume of each, from 1 to 10. Then you want to assess if the volume being sold is enough to leave room for your product. Sound confusing? It’s not that hard, but Scott explains it a lot better on this episode, so be sure to listen.
You also need to look at the volume and placement of reviews for the product you’re considering.
Why are reviews important? Because the amount of reviews a product gets, throughout all the variations and sellers, is going to tell you which of those products is a better seller and which are not doing so well. If you have 10 sellers of the same product and the top two have a ton of reviews, but none of the others have many at all, you might want to reconsider selling a similar product. Why? Because you’ll be fighting an uphill battle to make any headway in that niche - the top sellers already have the market on that product kind of buttoned down. Hear Scott’s explanation and tips on this issue by listening.
Considering price when you select a new product.
If you aren’t careful to look at the issue of pricing when you select a new product to private label, you could get yourself into a world of hurt. Let’s take an example. If you see 6 different products for sale in the niche you’re considering and one of them is priced at $14.99 but all the others are much lower, you’re going to have a hard time introducing a new product into that market. Why? Because it’s pretty clear that the main competition for that product is based on price, so it’s always going to come down to which seller is willing to make the smallest margin, which means you have to sell tons more products in order to really make a profit that’s worth all the effort. So be careful when it comes to price. Make sure you’re getting into a product niche that has plenty of room for you to fit in and take some of the sales. Hear more of Scott’s explanation of pricing and how it impacts product selection on this episode of The Amazing Seller.
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