Amazon for Beginners: Ultimate FAQ

 

Having a strategy for selling on Amazon can lead to profit and financial freedom. There is plenty of customers who are ready to place their orders, the gist is offering them what they are looking for.
Seems easy but in fact, it is not a piece of cake. Yet while most sellers have managed this task, you have all the chances to achieve success as well.
This article will tell you the main steps to start your own business:

  • How to know whether selling on Amazon is a great idea for you.
  • How to start working on the largest marketplaces on Amazon and not to waste time.
  • Secrets of successful sellers you should keep in mind.

 

Why should you sell on Amazon?

There are 3 simple reasons for doing this:

  1. Market size of this huge e-commerce store. People trust this marketplace. And according to ComScore, Amazon is the largest e-commerce platform in the US. It has more than hundreds of million users across the world.
  2. Customer experience everybody likes as Amazon really cares about it. They care about quick delivery and comfortable return policy. Shoppers and their rights are fully protected by the website, so they can be calm that third parties won’t spoil their customers' experience. People can receive their orders overnight thanks to developed logistics. Amazon has warehouses across the US.
  3. Intent to buy. Customers know what they look for. Well… You know, people visit Google for searching for information, they go to YouTube for videos, and they visit Facebook for communicating with friends. As for shopping, people usually choose Amazon. It is kind of a search engine for products and goods and people searching for something they want to purchase. Amazon has more than 200 million monthly visitors who want to order some products. Just imagine how much traffic will you get there, you can never get it with your own website alone.

So, you now see that it is a good idea to come to Amazon, but there are already lots of competitors who sell all kinds of products. How does it rank products while people search for them? Like any other search engine, Amazon has own algorithm named A9.

 

Amazon A9 Search Algorithm

Though it acts as a search engine, A9 differs from Google, Bing, and others. The main difference is the goal--making more money.
The more you sell, the more profit Amazon gets. So, A9 shows the most popular search results in the top. They put such products to the top as when you win, they win as well. And when you stop winning, they replace your products with more popular ones.

Here is an example.
When someone searches for ‘Ice tea infuser pitcher’. A9 finds the most relevant and popular results leading users to best-seller products.

ALWAYS keep in mind that A9 ranks goods in an order that helps maximize Amazon’s RPC (Revenue Per Customer).

The example above demonstrates that A9 shows the most popular and the cheapest items. It offers customers the best options. However, the lowest price can’t guarantee the first place for a certain product.

 

Which Factors are Crucial for A9 Functioning?

As we noted above, Amazon is fully motivated by growing Revenue Per Customer. For this, A9 defines which products can be purchased immediately and for which of the customers can return.
We can’t say what factors A9 uses for defining such products for sure, but here are our ideas regarding that:

  1. Relevancy to search queries. First, it makes results relevant to what customers look for. If they are searching for ‘tea pitcher’, they should find exactly these things.
  2. Best Seller Rank. This factor reflects recent sales--how well a seller works on Amazon. Though, it looks just at recent success and is not interested in long time periods.
  3. Conversion factors. Except for BSR, there are such factors as total reviews, answering customer’s questions, pricing and high-quality photos and descriptions of your products. Moreover, Amazon ‘likes’ products with different variations in listings (sizes, colors, etc).
  4. Positive user experience. Happy customers tend to come back and make more revenues for Amazon. So, they look at customer experience: inventory management, seller feedback, product reviews, perfect order percentage, packaging options, order defect rate, time on page and bounce rate.
  5. Using FBA. Amazon ranks such sellers higher than FBM. If you look at the search results for ‘ice tea infuser pitcher’, you’ll notice that the first results are Prime eligible (they use FBA). FBM can’t be Prime eligible.

It happens so as Amazon helps FBA merchants with logistics and shipping, while FBM sellers have to handle this on their own and not always this process is the same fast. You should choose FBA to achieve success on Amazon.
It means ‘Fulfillment by Amazon’ and it works so that all your products are stored in their warehouses, while Amazon is responsible for packing, shipping and providing customer service. Surely, they take a fee for that, however, the benefits are great:

  • With FBA you can dedicate more time to the products quality and your brand. You don’t need to spend much time on the operational side of your business. Amazon will manage this task.
  • Registering as a FBA seller along with using keywords will tell Amazon algorithm that it should show your product to more customers. And the more eyes see your goods, the more purchases will be made.
  • Only FBA goods are Prime eligible, so why not take this chance? Amazon Prime is a paid service that allows subscribers to get orders asap (in 1-2 days) and mostly free of charge. What’s more, such customers are aware that Amazon which has brilliant return policy handles their orders. They are likely to place an order for a FBA product.

 

Grow Your Brand on Amazon with Private Labeling

Shopper’s mindset has changed recently. It means that loud brand names have become not very important for making a purchase decision. Any other brand can compete for buyer’s attention. Your brand can do this as well.
In general, Private labeling means getting high-quality products from an outsource supplier, customizing them and selling these goods on Amazon. Don’t hesitate to learn more about creating your own brand, as even large corporations use private labeling, it is a great deal for every business.
Check out our previous article Detailed How-To for Private Label Sellers.

Additionally, after you create a private label, you will have full control over pricing and marketing, as branded goods can be sold by a higher price than no-name ones. Another good news is that you get the ‘buy box’, as your branded product has all chances to own the ‘buy box’ as you will be the only seller of goods under your own brand.

The last benefit of Private labeling is building your own brand that can be extrapolated to other resources. You can create a website for your brand or use other platforms except for Amazon (for example, eBay or other shopping platforms).

 

Closing Thoughts

We hope that your starting experience with Amazon will be wonderful and your brand will prosper. You can also check out our articles on How to Run Your FBA Business Successfully and How to Make Your Products Outstanding.