Why Sell on Amazon?

Ask a question about small business. We'll answer by email & post our answers here to help others.

I have an online store and have been advised that I should register as an Amazon seller, it's free or very cheap as far as I remember, and sell my stuff on Amazon too.

I went along to Amazon and took a look at some of the listed items (that I sell) and they are pretty competitively priced. Most, but not all of the things I sell are already sold on Amazon, and many of them are offered at prices that would make my profit margin extremely thin (and sometimes a loss).

Given what a competitive online retail environment Amazon is, is there any good reason for eCommerce site owners like myself to try sell stuff on Amazon?

View Selling on Amazon as a Marketing Opportunity

Whether you like it or not you are already competing with Amazon - everyone selling online has no choice but to compete with them. The fact that they are selling the same products as you (more or less) at lower prices means they are a competitor - and a good one at that.

That's the bad news. The good news, assuming you are prepared to venture into the world of multi-channel selling, is that, for Amazon...

1. The Cost Is Low

It is very easy to become an Amazon seller by signing up at Amazon's Seller Central. The costs are, as per their site,

Selling Plan Features Professional Individual
Best for sellers who Plan on selling more than 40 items a month Plan on selling fewer than 40 items a month
Monthly subscription fee $39.99 N/A
Selling fees Referral fees and variable closing fees $0.99 per item + referral fees and variable closing fees

2. It's Easy to Manage (with the Right eCommerce Platform)

It's vital you have an eCommerce store that offers tight integration with 3rd party platforms like Amazon and eBay. A good eCommerce site builder will allow you to integrate products with Amazon and manage them all from a single point so that your workload isn't doubled by adding a completely new sales channel.

Check out How to Sell on Amazon, section 3, entitled Integrate with your eCommerce Platform for a quick overview on the best way to do this.

3. Amazon can Boost your Reach

Amazon gobbles up a lot of the Internet's traffic. In fact, according to a recent Bloomberg report, more than 50% of shopper searches actually begin with Amazon.

Amazon originates over 50% of shopper queries. If you're not selling there, you are missing out on a huge chunk of eCommerce traffic.

Sure, it's competitive to sell on Amazon, but there are benefits to having presence there because it can mean your brand gains visibility and exposure amongst qualified shopping leads.

4. Get More Customers via Amazon (Creative Hack for Amazon Sellers)

You have to be creative when it comes to listing a product(s) on Amazon. There is a huge amount of competition and most products have an entire ecosystem of sellers all trying to compete for their share of sales. Often this involves a pricing competition - race to the bottom - in order to capture the Buy Now box listing.

But if competing on price doesn't sound like much fun to you, this hack will help to not only boost sales but also drive brand awareness and shoppers back to your own online store.

Bundle best selling items into one unique product and sell it under your company brand.

By creating a bundled product you are able to create an entirely new Amazon page (only possible when selling new products that aren't already available on Amazon) that you control. Put time and effort into creating an awesome landing page that not only sells that product bundle but also acts as a brand ambassador.

What returns do you get? For a start, your company name gets displayed on the product page.

Amazon product page with brand listing

In essence you are using bundled product pages on Amazon to both sell more and increase awareness about your own store because shoppers looking for more information about listed products (or similar products that aren't available) might well click through to your seller profile page.

Amazon seller profile page

Given the sheer volume of shoppers searching for items, Amazon can be thought of as a marketing platform that also generates sales. Once you look at it as a marketing channel it becomes easy to think of other ways to use it to boost sales and awareness.

5. Loss Leader Marketing with Amazon (Another Creative Hack for Amazon Sellers)

You might also treat Amazon as a loss leader - offering products so cheaply that you make no profit (or possibly a small loss) but gain the opportunity to reach out and build a relationship with that shopper.

Let's say you normally sell a product for $10, giving you a $3 profit. Offer it on Amazon for $7 meaning you make no profit off the sale. Instead use the sale to reach out and offer a different special (or other discount) to that shopper on your own store. Get them to sign up to your newsletter. Up-sell or cross-sell different items. Whatever you can think of.

A sale (even on with no profit) gives you a chance to interact with a shopper who, by definition, is interested in what you sell. This interaction can help more shoppers discover your store and provide an opportunity to build trust with them - leading to repeat business down the line.

6. Use Amazon to Dominate Google Search (Yet Another Creative Hack for Amazon Sellers)

It doesn't stop there. Not only do many people search directly on Amazon for products to buy, they also search on Google. And guess what? Amazon wins there most of the time too - in fact, I've seen search results in which Amazon hogged up to half the results on the first page.

Google search results are heavily skewed in favor of big sites like Amazon, making product listings a good SEO strategy.

Simply put (and regardless of Google's official line) it is virtually impossible for small business websites to compete with Amazon. So, if you can't beat 'em, join 'em.

Think about how searchers on Google might search for your product and ensure that you include relevant keywords and phrases to help your Amazon page rank well in Google. Check out our complete guide to SEO for more about finding and targeting valuable keywords (i.e. keyword research).