Last updated on August 12th, 2018 at 11:13 pm
I wanted to share a story that I think will inspire some about getting started on Amazon FBA.
From the moment I told my girlfriend about making money with Amazon FBA she was intrigued but nervous about where to start.
Before she met me she had never heard of Amazon FBA or the fact that regular people, like you and I, can make money on the internet.
She often lamented about her job, the stressful monotonous daily grind, and how she wished she could make a few extra bucks on the side. Her goal, like many of us, was to eventually be able to work from her laptop and live anywhere.
Long story short, I told her Amazon FBA is her ticket and I would help her make it work.
Table of Contents
Finding A Product
One of the most important steps in the FBA process is product research. If you don’t have a good product then nothing else really matters.
Product is key.
The first thing we did was decide what she could sell.
Given that I was helping her do this, I wanted to absolutely ensure that whatever we picked for her would definitely sell.
Not just a little, not just a maybe, but a confident level of certainty that her stock would sell through. After all, I would feel terrible if I was the reason my girlfriend lost thousands of dollars!
But, how can you predict such a product will sell?
Now, if you see any video or read any article on product research you will undoubtedly hear some guru telling you to avoid seasonal products like the plague. And I’m here to tell you that they’re wrong for a few reasons:
- Seasonal products are easy to forecast using historical data! (yes, they gurus are capitalizing on seasonal events too).
- You can almost guarantee you will make some money if you do things the right way.
To get back to the story, I decided that for my girlfriend’s first product, it would be ideal to pick something that would definitely sell. Seasonal products are great for this because demand is highly predictable.
Since we started doing research in April, we figured we would launch something with the intention to have it sell in July. Can you guess what major holiday is in the United States in July?
You guessed it!!! The 4th of July!
Once we decided which niche we would go into we had to narrow down some choices. I’ll tell you now, there are no secret tricks for this step. It really comes down to looking at a TON of products and generating ideas.
Go into a listing, scroll through “Sponsored Products” or “Customers Who Bought This Also Bought” and find something that looks interesting to you.
Each product I would look at I would use Keepa to look at the historical Best Sellers Rank (BSR). I wanted to see that the BSR was low enough around the holiday time, which would indicate that the product is selling well.
If I saw that a product was selling well around this time, I would then use that main keyword to look at the overall market.
In my girlfriend’s case, we stumbled upon 4th of July party sunglasses. After analyzing the top sellers, looking at their historical sales rank, we decided to do a keyword analysis using Wordtree.io. From here we could see all of the top relevant search terms for this product.
I also checked up on Google Trends to see when demand would start to kick in for this stuff. Based on our analysis we found that Mid-June would be when things picked up with a peak during the last week of June.
Since it was mid-April we figured we could launch by Mid-May, which would give us a solid month to get a few reviews and some sales history.
The next part we determined the cost and evaluated samples.
Luckily, I live in China so this part was a little less painful. Furthermore, since the whole purpose of this project was to teach my girlfriend how to do this, I had her handle the sourcing herself.
Unlike what most of us use to source, Alibaba.com, she stuck solely with 1688.com and found a list of suppliers she liked.
After contacting and getting prices, she had a batch of samples sent to our apartment here in Guangzhou. One of the suppliers stood out from the rest. They were responsive, easy to communicate with, and offered us a good price for the number of units she wanted to purchase.
For this order, we figured 500 was a safe bet. Not too many that you will be stuck with tons of inventory but also not too little in the case that you sell out too early.
She placed the order and paid the supplier.
Once the order was complete, the goods were shipped to her forwarder. This forwarder she met at a trade show and they promised to do inspection before shipping out which was an added bonus (usually I use a 3rd party inspection company, but sometimes the forwarder will do it as well).
Her final product was sent to their warehouses in Shenzhen where they were inspected, repackaged, and labeled with the FBA labels.
She paid the shipping cost and they were shipped out that day.
As the goods were being produced, I helped her out with the listing. We had one sample sent to a local photographer for some clean photos on a white background.
The photos weren’t super special but they showed the product in different angles and what the whole set would include.
In total, she got 7 photos and paid around 500 RMB or about $75 USD. Keep in mind, this is REALLY cheap. If you’re going all out on photos with lifestyle images, infographics, etc., you can expect to pay $300+ at the bare minimum.
To optimize the listing for the correct keywords I used Wordtree.io, which makes it super simple. I wrote up the copy myself and plugged it into Wordtree.io to see where I could add additional keywords. By the time I finished, the listing was 95% optimized for the most relevant search terms.
Once her shipment finally arrived at Amazon we knew we had to get some initial reviews. Without reviews it’s hard to get sales but without sales it’s hard to get reviews.
So, what do we do?
Well, I’m a big fan of this service called Rebate Key, which I’ve used on my last three launches and has helped me get dozens of those initial, hard-to-get reviews.
We set up the campaign to give away only 5 units a day for about 5 days. We also used a super URL so that we could target her main keyword with these giveaways.
You can read more about how to use Rebate Key launch service in this post I wrote here.
A few weeks after the launch we eventually pulled in about 5 reviews. Not a lot but enough to get some momentum.
This social proof also helps our PPC campaigns convert a little bit better.
Since this is a seasonal product with a fixed number of units, we figured a launch service like Viral Launch or Zonjump wasn’t ideal. We instead decided to go hard on PPC advertising, targeting all of the relevant keywords.
How do we know which keywords to use?
I’m glad you asked.
Remember when I talked about Wordtree.io? Yeah pull that sucker up and download all your relevant keywords into an Excel file.
Then copy and paste those suckers into a Broad, Phrase, and Exact Match campaign type in your Amazon Campaign Manager. We also started an Auto Campaign at the same time. We set the daily budget for each campaign group to $10.
When I start out an initial campaign I will usually set the bids at $1.00 until I get enough data to make changes.
After about a week, we started to adjust bids based on the search term reports that you can download in your “Reports” section of seller central.
Show Me The Money!!!
The product launched in Mid-May and as you might imagine it was slow going, which I was already expecting (she was not lol). She would have a sale one day, two sales another day, zero sales, two sales, and so on. Sales trickled in at this rate for about 1 month…
By Mid-June, my girlfriend was getting anxious. She expected sales to explode but I told her to be patient. After awhile she believed that the product was a complete dud and that it wouldn’t work but I new better.
I said, “just wait until next week.”
People aren’t shopping for 4th of July stuff in the middle of June…
So wait she did. And then it happened.
Bam 40 sales, $800 in revenue. Then 47, 49 next, then 54, $1,039 in revenue and climbing!
As I predicted, her sales exploded like a backed up fire hose finally releasing pressure. There were no signs of slowing down so we raised her price $3 and guess what? It kept going!
She was consistently pulling in $400+ in profit per day for a solid week!
As the holiday neared I expected sales to completely drop off but I was wrong. They still trickled in, 10-15 units at a time.
She invested a total of $1,537.80 which included product cost, photography, the relevant softwares discussed, and shipping. Her total Amazon payouts to date are $4,803.76.
This leaves $4,803.76-$1,537.80 = $3265.96 in net profit with the majority of this coming in the span of two weeks.
Out of 500 units there are still about 100 units left and she is still selling 2-3 units per day and will run out of stock soon within the next month.
The wonderful thing about this is that she learned the process of Amazon FBA and made a few grand in the process, a feat which most sellers cannot claim for their first product launch.
If She Can Do It, You Can Too
Most importantly, I wanted to show you how making money on Amazon does not have to be overly complicated.
We found a simple product, bundled it in a way that others were not, got some professional looking photos, wrote up a listing using the tools mentioned and voila! The seaonal demand did all the work for us (she did all this with only 5 reviews)!
I hope this post inspired some of you and helps you think outside the box in terms of how you can make this business model work. Don’t always listen to the gurus or the same videos telling you to avoid seasonal products.
You can definitely make a killing and this product launch was only a small example of what you can potentially do once you get skilled enough.
I’d love to hear your thoughts and please ask any additional questions below and I’d be happy to answer.