3 Ways To Find a Profitable Amazon Niche

Selling on Amazon is fairly easy to set up, which is why there are nearly 10 million sellers on the platform worldwide, and the numbers continue to grow.  While setting up an e-commerce store may be easy, being profitable is a different story. To maximize your return, it’s important to know how to find a profitable niche. 

A niche is a subcategory or smaller part of a broader, popular category. For example, “home office” is a main category, and an example of a niche is “ergonomic home office supplies.” As an Amazon FBA seller, the goal is to find quality customers versus quantity. Breaking down big categories cuts down on the competition in saturated markets. Though a broad category may be in higher demand by a larger audience, the competition is also steep. 

How many customers will buy from a seller they’re unfamiliar with versus Target, Wal-Mart, or another well-known brand? When selecting products to sell in your own ecommerce store, you want to find Amazon product niches that are in high demand with low competition. Here are three ways to find Amazon FBA niche ideas and capitalize on business growth.

Start with Everyday Products

Wondering what niche idea to choose? If you are looking at potential products, “fad” or trendy products, and seasonal items aren’t the type of Amazon niche product you want. Instead, choosing everyday products in categories that people use all the time is how to narrow down options and find your niche. 

Any product category relating to the home is a good place to begin. This may include small kitchen appliances, at-home gym equipment, or office equipment. Find a profitable product with stability that is highly sought after and will continue to be a necessity for most people. Then, use a niche keyword tool or an Amazon SEO tool and look at the Amazon Best Seller list to determine what’s currently in demand.

For example, under the fitness category, the niche could focus on yoga with items such as yoga mats, yoga balls, yoga straps, and so on to build out the inventory to serve a specific, yet viable market. It’s an area that has a large audience base but is more specific than trying to market to everyone looking for any type of fitness equipment.

Check Out the Competition

Perform a quick search on Amazon marketplace to see the amount of competition for the niche you’re considering. Entering a saturated category as a new Amazon business can be difficult to break through as your products won’t be listed in the top search. They’ll be competing with brands and sellers that have been around longer with more visibility and credibility. 

However, once you find a niche with less competition, review competitor seller pages and see where you can stand out. For example, competitor pages without videos or full product descriptions are places where you can provide added value to consumers. Give them a reason to shop from your store. This could be achieved by providing the most affordable cost, offering product customization, or building a strong social following. Identify what makes your store stand out.

Evaluate the Profit Margin

A key part of learning how to find a niche is considering the profit margin. Aim for a profit margin of at least 10% with a consistent sales rate. Generally speaking, you’ll want to choose products in a niche that are easy to ship, and at a price point, most are willing to pay and can afford. Anything within the $30-$100 price range typically performs well, although compare pricing with competitors to make sure you’re not overpricing (or underpricing) your inventory. 

Narrow down your inventory to a specially targeted audience but not one so small that the sales volume is low. The longer you keep your inventory in storage, the higher the fees, which cuts into your profit margin. Also, the larger your new product is, the higher the shipping cost. Assess all of the operational costs, whether you use Amazon FBA or another selling platform, and measure it against the projected profits. Even if these are trending products, the cost it takes to package and ship it may not be worth it in the long run.

Building a Profitable Amazon FBA Business

Being a profitable Amazon seller takes research and strategy to optimize selling efforts and ensure operational costs are kept low. Use the data and tools available to you through the Amazon seller portal to decide the type of products to sell from home, calculate costs, and confirm your pricing is competitive.

Finding the right niche means toeing the line of what’s most popular within a subcategory that’s not overly saturated with competition. Start with broad categories of everyday items and then zoom in to match what market research shows to be a viable option. Build a strong online presence and continue to optimize your product listing for search. Once you’ve set a strong foundation, it makes it easier to scale and profit years down the road.

Sources:

https://www.sellerapp.com/blog/find-amazon-niche/

https://www.junglescout.com/blog/potential-amazon-niches/

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