How to Make Money with Amazon’s Q4 Sales Rush
Learning how to make money with Amazon for the last quarter should be a priority for every Amazon business owner.
The last quarter is usually the busiest time of the year if you’re selling on Amazon.
But with all the changes that have been happening, Amazon sellers should also learn how to balance their inventory and cash flow.
So today, we will be discussing how you can prepare for the last quarter and make money as an Amazon seller.
E-Commerce and Amazon Statistics You Need to Know
As we all know, Coronavirus has created a huge impact on the way we do business.
It has shifted our lifestyle and greatly affected our buying behaviors.
Let’s take a look at statistics before we go in further at ways to make money on Amazon.
The pandemic reshaped our lives in unexpected ways. It also created and accelerated trends in business and consumer thinking.
For one, it accelerated e-commerce business growth by five years according to new data from IBM.
E-Commerce as an industry has been increasing its growth steadily even before the pandemic.
Projections at first were 20% YoY in 2020. But the pandemic has brought it up to a whopping 44.5% YoY in Q2 in the US retail e-commerce space alone.
Walmart’s e-commerce sales grew by 97%. Target grew its same-day fulfillment services by 273%.
Consumers also shifted their interest in categories such as alcohol, home improvement materials, and groceries while apparel saw significant declines.
[Read more details here: https://www.roirevolution.com/blog/2020/09/coronavirus-and-ecommerce/]
The Future of Retail Report by Braze/Wakefield Research also showed a 60% increase in online consumer acquisition from Q1 to Q2.
There’s also been an increase in mobile acquisition for online platforms of 62% YoY.
Despite the growth in online transactions, it shows that 82% of consumers are still expecting improvements in trust and overall shopping experience within the next six months.
On the other hand, Amazon’s quarterly report shows that it grew by 40% YoY with $88.9 Billion in sales.
Third-party sales also grew by 52% YoY during the second quarter. This growth outpaces Amazon’s first-party sales which grew by 48% YoY.
This trend also shows that Amazon is expecting an increase of 24-33% by the third quarter.
[Read more about it here: https://ir.aboutamazon.com/quarterly-results/default.aspx]
- The pandemic has accelerated e-commerce growth to five years
- Despite physical stores opening, consumers still tend to prefer online shopping
- Third-party sellers make up the most impact on Amazon’s growth in the last quarter
Is it profitable to sell on Amazon?
So what do all these stats mean for you as a seller on Amazon, and how can it help make you money on Amazon in the last quarter?
Statistics confirm that e-commerce is a good industry to be in at this time. But with it comes new challenges.
For one, customer experience and customer service need to be improved.
82% of consumers who buy online feel the need to have a safer experience when shopping online.
As a seller at Amazon, this means you’ll need to improve your customer service to ensure that your customers get a seamless experience.
Some ways to make this happen is by selling quality products on Amazon. Selling on Amazon also means you should also be sharing your business details to increase your customer’s trust factor.
Also, 65% of Amazon sales are done through mobile devices.
This means you should be optimizing your Amazon listings for mobile to increase your Amazon products’ visibility.
Knowing these trends will help you plan for success and earn money during the busiest season of the year.
It will also help you find the best ways to serve your target market and improve customer service and experience.
- Selling on Amazon is a great way to make money today
- More than half of product purchases happen on mobile
- Knowing trends can help you optimize your Amazon store and also increase your profit
How to Make Money with Amazon for Q4
As we always say here at Real Coaching, the goal of selling on Amazon is to create profit and increase cash flow.
And the fourth quarter of the year is always a great opportunity to do that.
This is a great time for you to make money and relaunch products on Amazon that did well in the past quarters.
It’s also a good opportunity to find products on Amazon that you can add to items in your category.
However, you still need to consider how the pandemic has changed buyer profiles and behaviors.
You also need to consider updates in Amazon policies that can impact how you plan for the selling season.
Here are some ways you can still make money on Amazon and find a balance between your inventory and sales.
Plan for success
Keep in mind that the pandemic has changed our buying patterns in just a few months.
In the past years, events like Black Friday and Cyber Mondays brought a lot of foot traffic into stores.
There’s also the last minute shopping we often experience during the Christmas season.
But with the restrictions and limits caused by COVID-19, you can expect that more people will be buying online instead.
With that said, expect the volume you sell on Amazon will be much higher this year.
Take a look at your April, May, and June trends and see how your categories have been doing. This will give you a sneak peek of how you should be planning your stocks and logistics for the upcoming months.
Expect the season to start earlier and last longer
Amazon knows that people will be looking online more now compared to previous years. So you should expect the selling season to start earlier and last longer.
At the moment, department stores and other brick-and-mortar shops are taking the brunt. Major chains are experiencing huge losses. Some are even forced to file for bankruptcy or liquidating all their assets.
Despite physical stores reopening, 83% of consumers still intend to shop online instead.
Consumers are also more open to trying new brands.
More than a quarter of global buyers have recently tried new brands during the pandemic and 95% of them have the intention of becoming repeat buyers.
So how does this impact you as an Amazon FBA seller?
This means you need to start stocking up as soon as possible.
Amazon is gearing for the upcoming “virtual smash”. Amazon associates will need to manage and prepare for this season’s rush.
Optimize your Amazon listing for mobile
As mentioned, 65% of Amazon sales are on mobile, so make sure your Amazon products and listings are mobile-ready.
The products you sell for Amazon should have stand-out main images. People tend to see the images first, so make sure it catches their eyes immediately.
You also need to optimize your title, images, and product description for mobile devices.
Here are some tips on how to optimize your Amazon listing: https://goteamreal.com/amazon-listing-tips/
You might not realize it but your store might have a different rendering on the web and on mobile.
The title on mobile only has 82 characters, and it should include the right keywords to help it stand out.
See your ranking on mobile listings as well. And you also want to look at your enhanced brand content and how it looks like on mobile.
Your product description and bullet points also need to make sense.
To sum it up, you need to be clear and direct with your product listing.
You need to make sure that your product and the title match up so your customers know exactly what it is.
It also helps you set up your ads better and avoid getting bad reviews from customers.
Check out this quick guide on how to optimize your product listing for mobile: https://tinuiti.com/blog/amazon/optimize-amazon-listings-mobile/
- Plan your inventory according to previous trends
- Expect the sales season to start earlier and last longer
- Optimize your mobile listings and make your product stand out
How to choose the best products to sell on Amazon to make money
Choosing the best products to sell on Amazon is critical in helping you make money on Amazon.
But having the right amount of stocks during this season is also important.
The secret is to back your winners and balance your stocks.
Think about your top 3 best sellers in the last six months. Then choose which ones you’re going to back, which ones you’re putting your cash flow into, and which ones you’ll keep in stock.
Here’s a practical tip: take a look at your best sellers and have the least inventory restrictions. If they’re doing well now, it’s also probable that it will do well in the fourth quarter.
Products that make money for you now would probably be the best products to stock up on for Christmas.
It also helps to get in touch with your sourcing agents and factories to understand international trends and demands.
This will also help you understand how the trends can impact your lead time as well.
It also helps to create a forecast based on the products you sold in the previous years.
Check which products performed well, especially from April to June. If you’re a beginner Amazon FBA seller and don’t have a sales history yet, check how your competitors did in the past months.
You can use tools like Jungle Scout to get an idea of your competitor’s stats. Here’s the link: https://www.junglescout.com/estimator/
Build a forecast that has information about your baselines, what you’re currently selling, the lead times involved in keeping stocks, and an estimate of the stocks you need.
It also makes sense to plan and manage your cash flow.
Invest in your plan to work out your costs. Make sure to negotiate the pricing and payment terms with your sourcing agents.
Doing these things will help you earn money and maximize your cash flow as well.
Discover how to find the best product to sell on Amazon here: https://goteamreal.com/best-products-to-sell-on-amazon/
- Back your winners and balance your stocks
- It helps to get in touch with your sourcing agent to see how international trends and demands will affect your product list and lead time
- Use tools such as Jungle Scout to check on your competitors and learn from their stats
What you need to know about Amazon Inventory Restrictions
While it’s looking to be a big shopping season for us, we do have a challenge when it comes to updates and announcements.
Amazon recently put storage limits for individual and professional Amazon selling accounts effective August 16, 2020.
According to Amazon, this will help them manage the fulfillment center storage better. It will also help them process received and delivered products faster, improving customer service and experience as well.
For new products, Amazon has imposed a 200 unit limit per ASIN. For existing sellers, the inventory restrictions will be based on your historic data.
So how do you manage this challenge?
One of the best ways we see is to split between FBA and FBM.
Third-party logistic warehousing and FBA can help you find the balance you need to overcome the restrictions and still get the right amount of stocks to keep your store replenished.
To do this, you need to create a condition and add FBM as an option on the backend so you could sell it from a third-party warehouse.
It also helps to start your ranking now. Amazon will increase your ASIN limits by Christmas and you wouldn’t want that.
Whatever you do, DON’T USE HACKS.
Don’t create a bunch of shipping plans and think you could outsmart Amazon. They will eventually find out.
And when they do, your FBA may be blocked. Or worse, your store could be shut down.
The key is to find a balance between raising prices and making sure you have the right amount of stocks available.
Remember, whoever wins the inventory games will win in this selling season.
- Amazon recently announced an inventory restriction to help them manage the demands of the upcoming sale season
- This limit can have an impact on your stocks if you don’t prepare for it.
- One way to solve this is by splitting your stocks between FBA and FBM. You can find a balance between pricing and selling your products as fast as possible.
What you need to do next to make money on Amazon
So far, we’ve discussed the trends in e-commerce and Amazon and how it impacts the business.
We’ve also talked about how to best prepare for the last selling quarter of the year.
Here now are the things you need to do to ensure that you make money on Amazon and make it the best season to sell.
- Start to plan your inventory needs now including FBA and third party logistics
- Plan your cash flow needs and negotiate with your factory, supplier, or a sourcing agent
- Get your listing ready for increased traffic
- Optimize your Amazon store for mobile views
- Plan to have an early Christmas
- Back your winners and keep your products in stock
- Consider your target market’s buying behaviors when deciding on the product to sell
Now that you know how to make money with Amazon for the last quarter, the next step is to implement them in your Amazon store.
There will be challenges, especially with the recent updates from Amazon. But with proper planning and forecasting, you can find ways to make money and make the best out of the last quarter of the year.
Listen to more tips on how to prepare for your best quarter sales below.
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