The key to succeeding on Amazon is straightforward when you break it down: find a great product, create a compelling listing, and get it in front of potential buyers. To boost your product’s visibility, we offer different Amazon services, designed to enhance your presence on Amazon and drive sales. However, the product launch process can be tricky, and Amazon business mistakes during this phase can be costly, especially if you are a newbie.
At DIGITAL OASIS, we’re dedicated to guiding you through every step of this journey. With over 30+ launches managed daily, we’ve experienced both impressive successes and some setbacks. To help you avoid common pitfalls in the Amazon business, we’re sharing 6 frequent mistakes so that you don’t face them and lose your precious investment.
What is an Amazon business?
When people list and sell things directly on Amazon’s marketplace, they are engaging in what is known as an Amazon business. Some examples of this include private labeling, in which vendors make and sell their own products under their own brand, and retail arbitrage, in which buyers buy items at a discount and resell them at a higher price. Entrepreneurs seeking to reach a global audience can find Amazon, a huge marketplace with access to millions of potential clients, an appealing alternative.
Setting up product listings, keeping track of inventory, dealing with customer care, and understanding Amazon’s policies and fees are all part of running an Amazon business. A number of fulfillment options are available to sellers, including fulfillment by Amazon (FBA), in which Amazon takes care of warehousing and shipping, and the seller’s own fulfillment operations. To be successful on Amazon, you need to have a well-planned marketing strategy, offer competitive prices, and optimize your product listings constantly.
How Can I Join Amazon Business?
To join Amazon Business as a seller and start selling products through private labeling, follow these steps:
- Create an Amazon Seller Account: Go to the Amazon Seller Central website and click “Register Now” to set up your seller account.
- Choose Your Business Type: Select “professional” or “individual” based on your business needs. For private labeling, the Professional account is recommended.
- Provide Business Information: Enter your business details, including company name, address, and tax identification number.
- Verify Your Identity: Complete the identity verification process by submitting the required documents, such as a business license and bank account information.
- Set Up Your Product Listings: Create and optimize your product listings with private label branding, detailed descriptions, and high-quality images.
- Choose a Fulfillment Method: Decide whether to use Fulfillment by Amazon (FBA) for handling storage and shipping or to manage fulfillment yourself.
- Launch Your Products: Begin marketing your private label products using Amazon’s advertising tools and promotional strategies to drive traffic and sales.
What Are Amazon’s Key Business Risks?
Amazon sellers face several key business risks that are crucial to its operations. The first and foremost is market competition, which is fierce, with numerous rivals pushing for a share of the e-commerce space, which pressures Amazon to continuously innovate and adjust pricing strategies. The second one is regulatory and compliance issues that also pose significant risks, as the company must navigate complex laws and regulations across different regions, which can lead to legal challenges and fines.
Finally, maintaining a strong reputation is vital, as any lapses in product quality, customer service, or ethical practices can negatively affect the brand and customer loyalty.
Top 6 Common Amazon Business Mistakes to Avoid At All Costs
Starting an Amazon business can be overwhelming with so much to juggle at once, making it easy to fall into common traps. To help you navigate this, here are some critical mistakes you should steer clear of. Avoiding these pitfalls is crucial, as overlooking them could lead to significant setbacks.
Mistake # 01: Neglecting Market Research Totally
A lot of individual sellers make this outstanding Amazon business mistake of trying to sell on Amazon without first doing extensive research. The truth is significantly different from what they think; listing a product is not enough to start making sales. If you don’t do your homework, you won’t know who to target, how much demand there is, or how to evaluate your competitors.
Doing market research is essential, but it is particularly important when you are just starting to launch your product. If you don’t do this, you could end up investing in things that don’t sell or that aren’t competitive enough to survive in the market. Additionally, you won’t get helpful information that can direct your marketing, product features, and price decisions.
No matter how sure you are of your product’s quality, it never hurts to do market research to find out where your target audience is, how much they’re prepared to spend, and how to best position your offering. You can’t make educated choices or have your listings noticed without market research.
That’s why you should use tools like Amazon’s Best Sellers and Google Trends to gauge what products are in demand and identify gaps in the market. Thorough research can help you choose a profitable niche and avoid investing in products that won’t sell.
Mistake # 02: The Wasting Of The Honeymoon Phase
When you first launch a product on Amazon, you enter a critical period known as the “honeymoon phase.” This is the first 30-45 days where Amazon is still learning about your product and trying to determine if it’s a good fit for their platform. During this time, Amazon will often give your new listing an unfair advantage, placing it at the top of search results even if you have far fewer reviews than your competitors.
This honeymoon phase is a golden opportunity that you must take advantage of. If you can drive a high volume of sales during this initial period, Amazon will recognize your product as a winner and continue to rank it highly in search. On the other hand, if you make one of the great Amazon business mistakes not to capitalize on the honeymoon phase, your product will quickly get buried by more established competitors.
The key is to have your best foot forward when launching. Make sure you:
- Have a strong marketing plan in place to drive a high volume of sales in the first 30-45 days, even if it’s not immediately profitable.
- Optimize your listing for maximum conversion, with a compelling main image, competitive pricing, and plenty of positive reviews.
- Leverage paid advertising to boost visibility and sales velocity during the honeymoon phase.
By taking full advantage of the honeymoon phase, you can set your product up for long-term success on Amazon. Fail to do so, and you may find your brand struggling to gain traction against more established competitors.
Mistake # 03: Not Running Ads
Many brands make the big Amazon business mistake of thinking they can simply list their product on Amazon and the sales will start rolling in. Unfortunately, that’s not how it works. If you don’t run ads to drive traffic to your listing, no one is going to find you.
This is especially true during the critical honeymoon phase. If you don’t have a solid advertising strategy in place from the very beginning, you’ll miss out on the opportunity to maximize your sales velocity and get Amazon’s algorithm working in your favor.
Even if you’re concerned about conversion rate or want to build up some initial reviews, you still need to be running ads. Without any traffic, you won’t be able to gauge your true conversion rate or get those all-important reviews. Ads are an essential part of the launch process.
Our advice? Allocate a significant portion of your marketing budget to Amazon advertising from day one. Use a combination of sponsored product ads, sponsored brand ads, and even Amazon DSP to drive as much targeted traffic as possible to your listing. This will give you the best chance of capitalizing on the honeymoon phase and setting your product up for long-term success.
Mistake # 04: Trying to Launch Your Entire Catalog
When expanding to Amazon, many brands make the mistake of trying to list their entire product catalog right out of the gate. This is a recipe for disaster.
Here’s the thing: when you first launch on Amazon, you’re only allocated 1,000 units of inventory. Once you sell through that initial 1,000 units, you can send in more inventory, but Amazon will slowly open up more space for you as you continue to sell through your stock.
If you try to launch your entire catalog at once, it will be your biggest Amazon business mistake. and you’re going to end up with a bunch of products that don’t have enough inventory or marketing support to really take off. Instead, you should focus on launching just your best-selling product first.
By concentrating all of your marketing efforts and inventory on a single product, you can maximize your chances of success during the critical honeymoon phase. Once that product is established and ranking well, you can then move on to launching additional products in your catalog.
The key is to take it one step at a time. Don’t try to boil the ocean; focus on dominating with a single product first, then expand your presence on Amazon from there.
Mistake # 05: Don’t Ignore Taking Reviews In The Beginning
New Amazon sellers often make the Amazon business mistake of not prioritizing review collection during the initial phase. I think a lot of brands make the mistake of thinking that reviews and sales will just happen naturally. Regrettably, that is wrong. Your product’s visibility and reputation will suffer without early reviews, which in turn makes it tougher to attract more buyers because reviews play the key role in building trust and establishing your product’s reputation.
So what can you do? Here are a few strategies:
- Automate your review requests: Use tools like Ecom Engine or Sellerize to automatically request reviews from customers after they make a purchase.
- Leverage your existing network: Reach out to friends, family, and past customers and ask them to purchase your product and leave an honest review.
- Optimize your listing for reviews: Make it easy for customers to find and read your reviews by prominently displaying them on your product page.
The key is to be persistent and creative in your approach to building up your review count. Reviews are essential for building trust and credibility with Amazon shoppers, so don’t neglect this critical aspect of your listing optimization.
Mistake # 06: Underestimate the Importance of Listing Optimization
Finally, one of the biggest Amazon business mistakes brands make when expanding to Amazon is failing to properly optimize their product listings. Your listing is your storefront on Amazon, and it needs to be designed with the Amazon shopper in mind.
Here are the key elements you need to focus on:
- Main Image: Your main product image is the first thing shoppers will see, so it needs to be high-quality, visually appealing, and effectively communicate the key features and benefits of your product.
- Pricing: Your pricing needs to be competitive with other similar products on the market. Shoppers will quickly move on if your price is significantly higher than the competition.
- Reviews: As we discussed, reviews are essential for building trust and credibility. Make sure your listing prominently displays your positive reviews.
- Fulfillment: Shoppers love the convenience of Amazon Prime, so make sure your product is eligible for Prime shipping.
- Title and Bullet Points: Use your title and bullet points to effectively communicate the key features and benefits of your product, and optimize them for relevant keywords.
- A+ Content: Take advantage of Amazon’s A+ content feature to create a visually engaging and informative product description that sells your product.
By optimizing each of these elements, you can create a listing that effectively communicates the value of your product and compels shoppers to click “Add to Cart.”
Neglect any of these critical areas, and you risk losing sales to more savvy competitors. Thus, Selling private labels on Amazon
is easy and risk-free if you go ahead with caution while mastering your expertise to avoid any of the above mentioned mistakes.
Conclusion: Avoid These Deadly Mistakes and Dominate Amazon FBA
Expanding your brand to Amazon can be a game-changing opportunity, but it’s also fraught with potential pitfalls. By avoiding these five deadly mistakes, you can set your Amazon FBA business up for long-term success:
- Don’t neglect the initial market research or fall into the trap of the product that you just like. Rather, use different tools to get the knitty, gritty detail of the product that you are going to choose.
- Capitalize on the honeymoon phase by driving high sales velocity in the first 30-45 days.
- Don’t make the mistake of not running ads; paid advertising is essential for driving traffic and sales.
- Focus on launching a single best-selling product first, rather than trying to list your entire catalog.
- Prioritize building up a strong base of positive reviews to build trust and credibility with shoppers.
- Optimize your product listing for maximum conversion, with a focus on the main image, pricing, reviews, fulfillment, and A+ content.
By mastering these critical elements, you can position your brand for long-term success on the Amazon marketplace. And if you need any help along the way, don’t be hesitant to get the free consultation from B2B digital marketing company, DIGITAL OASIS, where savvy experts with extensive experience are ready to boost your company’s growth.
