“Never give up…”
…As they say.
Clichés are a cliché for a reason. Because most of the time they’re true.
I’ve recently been documenting my Amazon adventure and in a recent post talked about how my first product didn’t pan out so well—I was a little depressed, discouraged, and ready to throw in the towel.
But, I’m so glad I didn’t. I’ve increased my price nearly ten dollars, still generating sales, and will recoup my entire initial investment.
I’ll get into those details in a little bit.
The trend I’m starting to see is that any revenue generating endeavor is going to take some time and a little bit of patience. Sure, there are unicorns out there that will blow up faster than you have time to think, but the majority of businesses just aren’t like that.
Now I’ve experienced this first hand with almost everything I’ve been involved with since I moved to China.
When I was working on my dropshipping store, If I had given up too quick I would have never found my winning product, which lead me to generate over $55K in revenue and later sell my business for 5 figures.
So why all the fuss?
Well, this Amazon FBA game is no different and luckily I was able to notice this before quitting (but we both know that was never an option ;)).
Listen To Those More Successful Than You
Something cool happened.
During the Canton Fair here in Guangzhou, I got the chance to speak with tons of successful Amazon sellers. In fact, many of these guys are doing 7 figures in sales per year. Here’s the one thing they all said to me:
“Don’t compete on price”
If you’re selling a product on Amazon and fighting tooth and nail against the Chinese by lowering your price, YOU WILL LOSE.
Most of these big guys I spoke to were selling for double or even triple the price of their competition AND they were still ranked up on the top of the first page!
But, of course that makes perfect sense!
Price as a Proxy
You see, customers want a quality product and price is often a proxy for quality. When you have hundreds of listings selling for $10 and one listing selling for $20, aren’t you going to be at least a little curious as to why the other guy is selling for more?
Well, this was my goal all along. The original plan was to make a better product and add value with better packaging and better photos, ultimately allowing me to price higher than the rest.
Well, I took this golden nugget of information and put it to the test.
Over the course of three weeks I used Viral Launch’s Listing Dojo to split test prices, slowly increasing $1 from my initial price.
And something really interesting happened…
My sales stayed the same.
So I did the logical thing and kept going. I kept raising my price and watched what happened.
Around $14-$15 I was making consistent sales but then something really cool happened. I upped my price again to $16 and my conversion rate rose from 25 percent to 28 percent!
I kept going.
What I thought was a dud has turned out to be a pretty good little product in a competitive niche. I’m now making a decent profit on each sale and reordered another round of inventory. With this new order, I will save an additional $1.50 per unit which will add 64% return on my investment.
Keep in mind, this product is seasonal and mostly sells in the summer. Don’t ask why I sourced it in the middle of July knowing that it wouldn’t arrive until end of summer (rookie mistake).
But, given that I’m selling consistently now, I’m confident that it will pick up quite substantially in the warmer months as my competitors were selling 700-1,000 units per month last summer. Some potentially great money to be made!
Moral of the Story
Sometimes progress isn’t always a smooth slope upward but rather jagged ups and downs—one step backward, two steps forward.
It takes a lot of time, patience, and energy to make something work but when it does, it feels amazing!
Now I’m using this regained momentum to focus on our second product that has just landed at Amazon’s warehouses and make it just as successful as the first.
Looking forward to keeping you all posted on how it goes!
As always, thanks for reading!
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