6 Dos and Don’ts of Amazon FBA you should know from day one!
Selling directly to your customer from your website is great, but selling Amazon FBA can provide a HUGE boost to your online sales — learn more.
If you are considering diving into the realm of ecommerce, you can’t ignore the massive Amazon marketplace. It is the leading ecommerce company with a market cap of more than 1 trillion USD as of February 2020. One program that has grown exponentially over the past few years is the Amazon FBA.
The FBA program has inspired thousands of sellers to join the Amazon marketplace and make it an ecommerce giant that it is today. Nearly 66 percent of the top 10,000 sellers on Amazon use this service. But there are significant differences between an Amazon FBA store and the traditional ecommerce store is in the way they operate.
In this post, we share the most important things you should do and the expensive mistakes that everyone should avoid to keep their ecommerce business afloat. But before that, here is a summary of the Amazon FBA service, and how sellers can leverage it to make more money.
Fulfillment by Amazon:
FBA or Fulfillment by Amazon is a service offered by Amazon where the company takes care of packing, shipping, and tracking the orders for customers. Amazon also handles returns and refunds, but this all comes at a cost. The seller sends their products to an Amazon warehouse where they are stored and shipped to buyers for a minimum storage and fulfillment fees.
The fees cover the cost of packing and shipping, as well as provides the opportunity to keep your product in front of the Amazon prime members.
According to Statista, the retail platform has an estimated 105 million prime members who spend $1,400 per year on average compared to $600 spent by regular buyers.
As an FBA seller, you will be more visible to the prime buyers and have a greater opportunity to maximize your revenue.
The Dos of Amazon FBA:
Here are six things that will further help you to that end.
I. Understand the Buybox algorithm:
Before you begin selling on Amazon, it is necessary to understand Amazon’s Buybox algorithm. The algorithm evaluates each seller’s performance and decides which seller will have his/her products added to the customers’ cart when they hit the ‘Add to Cart’ button.
The Buybox algorithm rewards FBA sellers since the program ensures on-time delivery with accelerated shipping and optimal customer service and feedback rating. New sellers who don’t fully understand the algorithm can benefit from the Amazon FBA Coaching and grow their business in the constantly evolving marketplace.
II. Research your competitors:
It is wise to conduct research on your competitors and understand the strategies they have adopted to sell their products. Get an idea about their best-selling products and try to offer similar products at competitive rates.
III. Understand the SEO game:
Just like Google, Amazon uses ranking factors to determine which products to show for a given search query. Once you understand the best SEO practices, you will be able to research and use keywords in your product listings and get higher in the search rankings.
IV. Use descriptive product titles:
Though sellers can use up to 250 characters in their product titles, it is not always wise to use lengthy titles. Try to use your keyword in the title and keep it to the point. Avoid filling it with unnecessary keywords and be as descriptive as possible.
V. Respond to questions:
Amazon provides a Q & A section where users can submit their questions about the product. Anyone can answer the questions, but it is vital to get yourself involved so that the customers can see that you are a cooperative seller.
VI. Include product visuals:
Product images are crucial. Use quality photos and visuals that accurately represent your product. Use 3d images on a clear background so that customers can see what they are getting.
The Don’ts of Amazon FBA:
Given that numerous new sellers are entering the Amazon marketplace every day, here is a resource that lists six mistakes that every seller should be aware of when using the platform.
I. Don’t violate the Terms of Service:
Just like any other platform, Amazon has specific rules that every buyer and seller shall follow. Before you begin selling your products, go through the terms of service to guard yourself against the risk of losing your account.
II. Don’t pick saturated niches:
One reason why many ecommerce businesses fail on Amazon is the lack of proper product research. Pick a suitable niche and avoid products that aren’t feasible for your business.
III. Don’t compromise customer service:
According to Gartner, more than 60 percent of users prefer better customer experience over price. This means that customers will flock to a costly alternative if it offers quality customer service.
IV. Don’t ignore negative reviews:
92 percent of the online shoppers read reviews before they proceed to purchase the product. So, if you haven’t received any reviews or collected a lot of negative reviews, you are actually losing potential customers.
V. Don’t offer low-quality products:
Nothing repels a customer like a low-quality product. It can doom your online business before it even sees the light of the day. Before you list a product, inspect its sample, and perform a thorough quality check to avoid any hiccups.
VI. Poor market research:
Many new sellers lack to conduct proper market research for their products. Hence, they fail to pitch the right product to the right market and lose many potential clients.
These are the 6 dos and don’ts that every Amazon FBA seller should know before entering the largest online marketplace.
What other factors should novice sellers know when starting a business? Let us know in the comments!