I get it, you’re pumped about the possibilities of selling Amazon private label products. But, you don’t know where to start. If you’re a beginner, you’re in the right place. While many new online sellers start with Retail and Online Arbitrage, Amazon private label is the product sourcing method that gives you the most reward, but also involves the most risk.
Look, I’m not going to completely hold your hand because you should have the savvy to do the basics, like creating an Amazon account. If you can’t fill in the blanks on your own, entrepreneurship is not for you. And I’m certainly not going to give you generically regurgitated content that will leave you with an empty wallet and a garage full of fidget spinners.
What I am going to do is give you a step by step process to go from sitting at your laptop empty handed, to honing in on a product that can put money in that empty hand. And it all starts with doing the best Amazon private label product research to find that winning Amazon private label product.
Let’s break down how to sell private label products on Amazon, so you can build it back up.
1. Do What You Love…or What You Know
Most Amazon FBA sellers start looking for products in all the wrong places. Not just beginners, but experienced ones too.
They start out by going to Google Trends, scouring Amazon’s Best Sellers lists and combing through Amazon pages using Jungle Scout until they are blue in the face. While that is important, that should not be your first step in this journey.
Why? Well, for one, that’s what thousands of other people are doing who also bought the same proven Amazon course. You’ll find a suffocating amount of group think that ends up leading to price competition, increased ad cost and overall low margin items.
Besides that, it’s just not as fun to wake up every morning working on selling some bamboo kitchen utensil that is a dime a dozen.
Then, what the heck should you do? Do what you love! Or, at least what you know. You may not think so, but you very likely know more about most in at least one topic.
- Do I have a passion? For example, guitars, cars, pilates, gardening, pets, etc.
- What is unique to my line of work? There are products that surround you every day at work. Some are more unique to your line of work than others. Take a hard look and find them.
- Is there something unique to my region of the world? Think about Maple Syrup to Quebec or straw hats to Bali.
- Have you had a challenging shopping experience recently? Maybe you were searching for reusable window coverings during the winter, but none were available in the size you needed.
Hopefully you get the picture. Basically, there are enough garlic presses, cutting boards and kitchen utensils on the market. Hey, if you’re making something super niche in one of these areas, don’t let me stop you. But the long term approach is selling Amazon private label products that you already have knowledge in and aren’t overly saturated.
Ideally, you have 2-3 areas of interest or relative expertise. The more you can brainstorm, the more options you’ll have for products. But like everything you’ll learn from me, I’m looking for quality over quantity. So let’s not get too carried away.
2. Build Out Search Terms
Now that you’ve honed in on some things you like or feel knowledgeable in, we move forward to our Amazon Search. But, let’s get some search terms to delve into.
Say what? Gathering search terms before I find a product. No, I didn’t accidentally mess up the order here of how to sell private label products on Amazon. While you don’t need to go knee-deep in keyword research to start, you should at least have a general understanding about what people are searching for. These tasks usually go hand-in-hand anyway.
I’m talking about more general search terms. We’re just going to use some simple steps. You’ll want a Google Sheet or Excel Spreadsheet opened to build out a record of these search terms.
Let’s say I was interested in gardening (which I am, but live in drought-ridden California), I’d go over to Amazon and search the word gardening. But let’s do it slowly, because Amazon has a “smart” search bar. That means, as you type each letter, it automatically populates words and phrases that are most searched using those letters or words.
What I can see is that once I get to “gardening”, all sorts of gardening related suggestions start to auto-populate.
We’ve got the following:
- Gardening gifts
- Gardening gloves
- Gardening tools
- Gardening gloves women
- Gardening shears
That’s a good, broad start. I’m going to pass on “gloves” or anything somewhat “fashion” related like hats because starting off your Amazon Private Label journey in the fashion niche is going to be an uphill battle. Let’s look for non-fashion items. I’ll check out Gardening gifts because it is pretty general and I want to get a look into what people are shopping for.
But first, I’ll add all of those keyword phrases into my spreadsheet. Since these are broad search terms, I’m going to give them their own column at the top of each spreadsheet.
Again, when I finish typing in Gardening gifts, I see all of these other terms pop up. This is EXACTLY what customers are looking for. I’m looking for search terms that are specific, but not unique to a brand, like a specific name of a product. I’m not seeing anything staggering standing out
What we see is:
- For women
- For men
- For kids
These search terms are more helpful to constructing your listing than they are for finding products.
We’ll still add these keywords under the Gardening gifts column and keep moving. Other search terms I recommend adding to the search bar are:
These are just some more general terms that you can add to a lot of different root search terms.
Let’s see what we get when we just search for Gardening gifts.
Well, from taking a look at the listings, we’re getting everything but the kitchen sink. And that’s good. That will help us understand what people are searching for in this broad search term.
Since this is such a broad search term, we’ll want to scroll through a few pages and see if we have any recurring themes or products that particularly stand out. We’ve got:
- Garden tools set
- Garden tools carry bag
- Garden tote
- Garden kneeler
3. Identifying Potential Amazon Private Label Products
You may feel overwhelmed by all of the products available, and that’s fine.
Three key aspects to keep on eye out for are:
- Eye Catchers
A. Gimmickry Explained
Gimmickry is a product that looks cheap, sells for cheap and leans towards marketing over product quality.
The perfect example? I present to you: Gardening gloves with claws.
I’m not going to spend too much time here, but if you get the sense that there are an abundance of listings of products that make you say “really?”, then you should probably move on.
Just picture yourself wearing gardening glove claws…
These are exactly the types of products that these so-called proven Amazon courses lead you to sourcing, and then you end up in a race to the bottom, wondering why you ever got into this business anyway.
B. Pricing Explained
There are millions of potential products to choose from, so it would only behoove us to focus in on products that will have the most bang for the buck.
In our business, we strictly target products that have an average selling price of $25 and up.
Why? There are fixed costs on Amazon, such as FBA Fulfillment Fees, and with any eCommerce physical products business, that will impact your margin. The higher the price, the less percentage impact these fixed costs will have.
With a lower priced item, you’re also exposing yourself to more risk with competitors driving down the price.
In the case of this Gardening glove with claws product above, it’s priced at $15.77, which is pretty low.
One thing you can do to narrow in on higher priced products is select the $25-$50 range filter on the left side of the Amazon search results screen.
This simple refinement can save you lots of time, and really get you on the path to finding some of the most profitable Private Label products to sell on Amazon.
C. Eye Catchers Explained
This is basically the exact opposite of gimmickry. Eye catchers make you say, “hmmm”, in an almost oddly sinister way…like Yoda! These are products that pass the gimmickry and pricing test and have an interesting look about them. They also make you say, “wow, I would have never thought of that.” But in a good way. The Eye Catchers are easier to find if you are already familiar with the niche, like we talked about in the brainstorming section.
When I searched for Gardening gifts, there was an Amazon Sponsored Ad that came up for a Mason Bee House. The product immediately caught my eye. For one, it looks really nice in the photo, and the price was a robust $44.95. Let’s take a look.
I was like, “Mason Bee House, what have’th we here?”
This passed my 3 rules for identifying a potential Private Label product to sell on Amazon. So, I delved deeper.
4. Assessing The Competition
Now, I’ve gone from the search term Gardening gifts to Mason Bee House. Again, let’s pop that search term into the spreadsheet we’re building.
What we now want to do is get a broad idea of the viability and competitiveness here, as we’re not trying to get into a saturated market.
Let’s search the phrase Mason Bee House in the Amazon Search Bar.
Here’s what I’m looking for on the Amazon search results page:
- Product Reviews: How many listings have over 100 reviews?
- Page Results: How many pages show for this search term?
- Best Seller Rank: How are the top products selling?
- Seasonality: Does it sell more/less depending on the time of the year?
- Content Marketing: How do the listings content look?
- Price: Can this really be profitable?
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A. Product Reviews
On page 1 of the search results, I count 2 listings with over 100 reviews. And “Amazon’s Choice” only has 32 product reviews. You can basically sneeze and get 32 product reviews if you have a good product and decent marketing strategy.
To make it more clear moving forward, I’m going to be focusing in on two products here. There’s the “Amazon’s Choice” product seen below and what we’ll be calling the “Premium Priced” product which we found earlier via a Sponsored Ad.
Why are reviews important? Well, in the world of Amazon, the more reviews means the more sales you’ve had and the more sales you will get. It’s like the chicken and the egg…
So, if you want to compete in a market with a new product, you’ll be competing against listings that already have a number of reviews. The more reviews out there, the harder it will be to compete. And of course, that will mean more marketing dollars going to your product launch and generating reviews.
In this Amazon case study, the Mason Bee House does not pose a major challenge to outpace competitors and their review counts.
B. Page Results
I can also see that there are only 6 pages of results for this search term, which is not very competitive.
While there aren’t any hard and fast rules, the less pages means less competition. But it could also mean that this search term doesn’t get a ton of searches from customers. So, competitors aren’t that eager to get into the market.
Or, it could mean that you’ve just found a product that hasn’t been saturated by marketers (like us), and there’s a big opportunity for us to make a business in this niche.
To give you perspective, if I searched for “Ceramic Knife”, I get a whopping 110 pages of search results!
In case you were wondering why I’m seeing the Best Sellers Rank directly on the search results page, I’m using the Helium10 Plugin. Helium10 is a paid, comprehensive Amazon keyword research and analysis tool, but you could just as well use DS Amazon Quick View for viewing the BSR on the results page, which is Free.
C. Best Sellers Rank
The Best Sellers Rank or BSR is just about the only sales data that Amazon divulges to sellers. BSR is a number calculated based on the number of conversions and conversion rate, relative to all of the other products for sale in a specific category. The lower the rank, the higher the sales.
Now, there are things to be careful about, like making sure you are looking at the main category rank versus the sub-category rank, understanding how large a specific category is, etc. Also, the Best Sellers Rank is constantly moving around. A product can be a 10,000 rank now, but drop to 5,000 after some consecutive sales, or promotional giveaways. These factors can make a big difference in your analysis, but that would take an entire other article to recap.
Back to the Mason Bee House. If we click on Amazon’s Choice in this category, we can take a look at what the Bestseller Rank is for the item. You’ll need to scroll down the page to “Product details.” We can see that the main category is “Patio, Lawn & Garden” with a Best Sellers Rank of 9,593.
That’s not bad. But again, you need context around it. The last time we performed a BSR audit at NewlyPreneurs.com, we saw that there were just over 1 million products for sale in the category Patio, Lawn & Garden.
Unfortunately, that data is from 2016, when Amazon stopped private label sellers from searching for total products for sale in specific categories. But, we can only imagine that there are more products for sale in this category since 2016, which would put this product in the Top 1% Best Sellers Rank in the category. That’s very good.
You can use our free Best Sellers Rank resource to have a general idea of what these ranks mean in each category.
The other thing to note is that the product has run out of stock, as it says “Usually ships in 2 to 4 weeks.” If Amazon is selling an item and it says that, that’s just them saying the product is out of stock and on back order.
What I can see though using my crystal ball, aka Keepa, is that the product had an #881 rank as recently as March 2018. Since the product is out of stock, the Best Sellers Rank has shot up.
Keepa is a free add-on that shows you historical data of Amazon Listings, such as Best Sellers Rank, Pricing and Amazon’s In/Out of Stock periods. I’d highly recommend it Amazon Private Label sellers. Like seriously, get it now…Go!
If you’re not sure what a product’s Best Sellers Rank means, which takes time and experience to understand, Jungle Scout is also an excellent tool to put it into context. Basically, Jungle Scout takes the BSR, plugs it into an algorithm and tells you what that means in actual dollars and units.
Now, Jungle Scout is a paid tool, but it’s a relatively small expense to give you perspective.
When I look at Jungle Scout, I can see that it interprets a 9,593 BSR to yield 167 units and $3,338 every month. That’s not bad, but imagine it was at its previous rank of 818 when it was still in stock?
We can garner this information by looking at some of the other listings, but I like what I see with regards to the Best Sellers Rank.
It can be easy to overlook the impacts of seasonality on Amazon Private Label products, but it’s important. After all, not every seasonal product has to do with Christmas.
In the case of Mason Bee Houses, it is obviously seasonal. What’s not so obvious is the direct impacts of seasonality on sales, and for this product it is significant.
Looking at the Keepa graph for the Amazon’s Choice product, we can see that sales spike in the early spring through the summer, but start to plummet in the Fall.
The worst months are September, October and November. But, come December, it looks like customers are buying this as a gift for the holidays, or are getting a head start on their plans for warm weather activities, like Beekeeping.
The worst rank in this seasonality window was 118,000, which is pretty bad. There was also a jump in rank when Amazon went out of stock in December. (Indicated by that white stripe in the graph.)
E. Content Marketing
This is more subjective, but it’s still important. What you’ll want to do is look at all of the competitive Amazon private label listings and determine how well their content appears to you. I’m typically looking for:
- Low Quality Photos
- Inadequate Number of Photos (Amazon displays up to 7 photos on a listing.)
- Non-Compelling or Non-Descript Titles
- Poorly Written Bullet Points and Product Descriptions
Ideally, I find that the listings ARE NOT optimized. This gives an excellent opportunity to take great photos and write exceptional content, capturing sales from the listings that neglect Amazon SEO.
We’ll take a look at our two listings, Amazon’s Choice and Premium Priced.
-Amazon’s Choice Listing
Let’s take a look at the Images, Title and Bullet Points.
- Images: This listing only has 2 photos, although Amazon would show up to 7 on a listing. The photos aren’t bad, but they’re not overly descriptive. I’d add more, high quality images.
- Title: The title is short, and the only keywords in the Title are “Mason Bee House.” This is the spot where you want to have your most important keywords and get a prospective buyer to click.
- Bullet Points: Amazon allows up to 5 bullet points, and it helps to use them. The content is vague and not compelling.
It’s not hard too tell, but this listing can be vastly improved upon. So, it’s promising that this product converts as much as it does with such vague content.
– Premium Priced Listing
And then we have the Premium Priced listing, which you’ll quickly find is a solid model of an Amazon listing.
- Images: The images are a vast improvement over the previous listing, and they have all 7 photos listed. That said, they neglect to give photos that show the product in its entirety. While infographics are great, we still want to show the customer what they are getting with high quality closeups of the actual product.
- Title: Again, a big upgrade on this listing. But, come on. Can you say that out loud? It’s quite mouthy and hard to read. We are certainly benefiting as they are giving us a plethora of juicy keywords to use in our own listing, like Wooden Beeblock and Bee Home Nest.
- Bullet Points: See Bullet 2. Yes, there are a lot of features, but the bullets are way too long. We can hone in and, ideally, make the bullets no more than 2 lines on a standard desktop view. Imagine trying to read that on your iPhone or Android?
Overall, I’m not impressed with the Amazon’s Choice listing and am very impressed with the Premium Priced listing. I’d assess the other listings on page 1 and see what’s going on. We want to get a general sense of how many listings are being actively managed. It’s evident listing 1 is not managed, while the owner of listing 2 is all over this.
Ah, yes, the all important Price. I could’ve put this first, but I wanted to save the best for last. You know, I wanted to at least keep some suspense here.
Like I said earlier, I’m looking for Amazon private label products that are over $25.
But, if you have a product that is small, light and easy to ship, that will make a lower priced product more viable. On the Amazon Search Results page we can see that the prices range from $20 to $45.00. But, the Average price is around the $20 mark.
Amazon does take a good chunk of fees from each sale, and even more if you are selling on Amazon FBA. You can check the fees taken out of each sale using the Amazon Revenue Calculator.
Let’s take a look at what our payout would be if we were selling Amazon’s Choice Mason Bee House. That’s what Amazon would put into our account after they take all of their Fees, which includes Commission and their FBA Fulfillment Fees to Pick, Pack and Ship the product to the customer.
What we see is that we have $12.20 left over to work with. That means, if we want to make 100% Return on Investment (ROI), the following totaled costs cannot exceed $6.10.
- Product Cost
- Packaging Cost
- Product Inspection
- Shipping From China (or country of production) to the USA
- Customs and Duties
- Shipping from the USA to Amazon FBA
- Promotional Giveaways
- Storage Fees
Those are many of the costs that you’ll find associated with a product. This is an area that you’ll get a clearer picture once you start working with suppliers, but for now, it’s worth noting that making a 100% Profit would be more challenging at this price point, even though this is essentially a few pieces of wood.
But, what if we looked at the Premium Priced product?
Wow! Night and day. It’s not hard to imagine that the Net Profit would be that much higher. Yes, both of these products are priced worlds apart, but this listing is obviously succeeding with their high end marketing angle. And I think we can have a good shot.
My general sense is that even though $20 is the average price, Bee enthusiasts are willing to spend a few more bucks to get an apparently higher quality product. Or, at minimum, a product with better marketing.
Just take a look at the Fulfillment by Amazon Fees with the two different products. The Amazon’s Choice listing has FBA Fees of $4.79, while the Premium Priced listing has FBA Fees of $5.20. These fees are based off of the weight and dimensions of the package, and they will not change if the price goes up or down. So, whether these products sell for $20, $50 or $100, the FBA Fees will be the same!
That’s why the higher price point is so important in this Amazon private label business.
It’s up to you to set an ROI you are most comfortable with, but most Amazon Private Label sellers shoot for 100% ROI.
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5. Determining Amazon Private Label Viability
Let’s continue the process of our research by determining viability.
You’ll want to take the information that you’ve garnered in the previous section to determine whether or not this is a product that you want to explore further.
We’ll just recap the key considerations:
- PASS – Product Reviews: There are only 2 listings with over 100 product reviews, and the ones getting most of the action are at 50 reviews and under.
- PASS – Page Results: With only 6 pages of results, this market is not saturated.
- PASS – Best Sellers Rank: A listing with an 818 BSR means there is plenty of action.
- PENDING – Seasonality – There certainly is seasonality. But it’s not a super short season, like Christmas. We can see good sales for 7-8 months, making this worth it if we can manage our inventory appropriately.
- PASS – Content Marketing: Most of the listings aren’t actively managed, with exception for the one that we’re going to use as our benchmark.
- PENDING – Price: The price is tricky here. The average price is $20, but we have Premium Priced listing working at $44.95. We need to make the determination if we can command a price that would yield a high volume of sales.
Overall, I do like the product idea for the Mason Bee House. There are more pros than cons.
Seasonality certainly plays a key role here, but it’s not a reason to back down from a good product. You just need to be even more scrupulous with your inventory purchases, ensuring you don’t run out of stock in the peak season, but you aren’t overstocked through the down months.
Really, the pricing is the X factor here. But like I said at the beginning of this Amazon Case Study, I’m about quality over quantity. And I’m confident that we can cut out a profitable niche in this market if we have the right product and marketing strategy.
6. Finding A Gap In The Market
Now, the alternative approach. While many sellers would look at this Mason Bee House opportunity and say, “OK, if I can duplicate this product and get more reviews, I can be successful.” I’m sitting here screaming at you and saying NOOOOO!
Yes, by all means, let’s get as many reviews as possible. But, speaking from experience, the best way to get reviews is not be duplicating a basic product, giving away your entire stock for pennies on the dollar and then sending a barrage of follow up emails to generate reviews.
And don’t even get me started on Piggybacking. I never want to hear that word from an aspiring Amazon Seller again. Let’s save it for rainy Sundays, when we start to get cabin fever. Oh, the rug burns…ouch!
When I first got started selling on Amazon, I was all about Retail Arbitrage and Online Arbitrage. And I remember reading one of Chris Green’s books where he talks about the “gap in the market.”
Over the years, I’ve adapted the meaning of this gap, and it has a specific application to Amazon Private Label. It means, that there is very possibly a gap in this specific Mason Bee Home product that we can take advantage of. And the easiest way to get more reviews and command a higher price, is sell a product that is exceptional!
The modifications can include:
- Different Size
- Different Colors
- More Durable Materials
- Accessory Upgrades
- Bundles with Ancillary Products
Now, if you were experienced in Bee Houses, you may have ideas already. But don’t take your word for it.
You are NOT your ideal customer.
Your ideal customers are the people who have already purchased this Amazon Private Label product.
How can you find this gap in the market and make modifications? Read the reviews!
What you really want to do is go to each of the most popular listings and read the reviews. It doesn’t have to be every single review, depending on how many there are. We want to target in on the 1-3 star reviews. This is generally where the most honest critiques will be.
We want to find product flaws, suggestions and improvements. That’s the real gold mine.
Here are a few reviews that I found in our target product listing:
1- Star Reviews
Amazon’s Choice Product
1-Star Review Takeaway: Can our potential supplier attach a hook to hang the Mason Bee House?
Premium Priced Product
1-Star Review Takeaway: Can our potential supplier drill 10mm holes in our Mason Bee House?
Premium Priced Product
2-Star Review Takeaways: Looks like this Premium Priced product is not so premium. Customers are complaining about the quality of the hinges and hardware. How can our potential supplier improve the hardware so that it’s not so fragile? Can we use longer wood screws?
Premium Priced Product
3-Star Review Takeaway: Again, the customer is dissatisfied with the construction of this product. Also, we’ve just learned that Mason Bees are very picky about the size of their “nesting holes.” This is something worth verifying from expert Beekeepers, researching articles about Mason Bee Houses. We’ll want to find the ideal size for Mason Bees and ensure that our potential supplier can make it.
I’d advise that you do this type of product review investigation for all of the top listings. And by all means, add this data to your Excel Spreadsheet. At this point, it would be beneficial to create a separate sheet for your Mason Bee House product.
The more data you can gather the better off you’ll be. There are always surprises with Private Labeling on Amazon, and ensuring that you have done your due diligence can mean the difference between a successful product launch and a stressful, money burner.
Which Mason Bee House Should You Be Going For?
Now, from our research we’ve honed in on the Amazon’s Choice product and the Premium Priced product. They are obviously both very good products, with their own pros and cons.
The wheelhouse with Amazon Private Label products is having a competitive price, but offering additional features that can give you that extra margin to really succeed.
In the case of Mason Bee Houses, I think that the Amazon’s Choice product has the price point and basic functionality to bring that high volume. It had a 818 BSR at one point, after all. But, it’s lacking in the marketing department and there are features, like a method to hang the Bee House that can bring it up a notch.
On the other hand, the Premium Priced option has some great features and marketing, but I think it’s overcomplicated things, sacrificing sales as a result. It’s more than doubled the average price of these products, and only added in a few things that are legitimate up-sells, like the Bee Viewing Window and Wildflower Seeds.
From my standpoint, the Amazon’s Choice product is the better product as it appears to be less technical, shows the highest demand, and has the most room for improvement.
Moving forward, that’s the type of Amazon private label product I want to source from our supplier.
7. What To Do Now
Wow! You’ve come a long way in the journey of finding a Private Label product to sell on Amazon. From simply asking the question of how to sell private label products on Amazon to having a solid product staring right at you, that’s a big step. But, the journey has only just begun!
Now you have an idea, but it’s really about the execution. That execution includes:
- Finding a qualified supplier
- Ordering and testing samples
- Placing your first bulk order
- Creating an expert product listing on Amazon
- Planning and executing your product launch
- Selling through your first order, learning from your mistakes and improving as you go
These are just some of the high level aspects of the next leg in your business as a new found Amazon Private Label seller.
And while I’d love to stick around and deep dive into these topics, that would be best saved for a future set of articles.
But, you can take all of this information that you’ve learned and go check out the Alibaba marketplace to get a jump start on your product development and testing. Alibaba is the home of the vast majority of Chinese Manufacturers, and Trade Companies, where you’ll have your best bet of finding that perfect Amazon Private Label product to meet your requirements.
If you’re stoked about getting your business going right now and just can’t wait for that next article, there isn’t a better resource than a business coach. At NewlyPreneurs, we offer one-on-one Coaching Packages at very reasonable rates. We’ll take you from the product research stage, all the way through finding the best suppliers and launching your product. You’ll be on the Amazon Private Label Fast Track!
To break the ice, we’re offering Free 30-Minute Phone Consultations for a limited time where we’ll discuss your goals, needs and how to go from product-less to a profitable Amazon Private Label Seller.