Getting an Inside Look at Amazon Selling Habits Through 1,500 Retailer Data

Have you ever wondered how other sellers structure their Amazon businesses? Understanding common selling behaviours and strategies can provide valuable insights to improve your own approach.

In this in-depth guide, we’ll breakdown key findings from a comprehensive 2016 survey that analysed the habits of over 1,500 Amazon retailers. By learning what works for others, you can optimise processes like inventory management, promotions, and sales channels for increased success.

Let’s dive into the data!

Survey Overview

The survey, titled “The Selling Habits of 1,500 Amazon Sellers,” was a joint project between Feedvisor and Web Retailer conducted in 2016.

They gathered responses from a wide range of Amazon sellers across product categories and revenue levels. This yielded a wealth of actionable information that is still highly relevant today for observing industry norms.

Some of the topics covered include:

• Revenue breakdowns
• Fulfilment methods
• Top product categories
• Alternate sales channels
• Profit margins

By understanding typical behaviours, you can identify areas for improvement or expansion within your own business model. Let’s explore some of the key findings.

Revenue Size of Respondents

One surprising insight was that smaller sellers comprised the majority, with 50% reporting under $100k in annual sales. Only 9% made over $1 million.

This debunks the notion that only massive brands dominate Amazon. In reality, the platform supports a long tail of smaller players. As a result, there is opportunity regardless of size to carve out profitable niches.

Amazon Domination and Alternative Channels

Unsurprisingly, Amazon was the top sales channel at 73% of revenue. However, eBay came in second at also 73%, showing many diversify across multiple marketplaces.

Rakuten and Etsy followed with much smaller percentages, likely due to their more specialized product focuses. This emphasizes having an “Amazon-plus” strategy to mitigate risk.

For example, maintaining an eBay store ensures income continues if you face an Amazon suspension. Diversification opens doors to new customers beyond any single platform.

Top Product Categories

Home/kitchen was the #1 category at 16% of sales. Toys/games, books, health/beauty products rounded out the top categories respectively.

This breakdown provides a framework to identify in-demand item types. For example, focusing on home goods allows tapping into Amazon’s largest segment. Knowing customer preferences helps optimize product selection.

Fulfillment Methods

The survey found 80% used Fulfillment by Amazon (FBA) in some form, highlighting its broad industry adoption for convenience. Non-FBA approaches saw 10-25% profit margins on average.

In comparison, FBA products averaged much higher margins between 25-50% due to reduced costs and logistics hassles. This data supports the benefits of leveraging FBA where possible.

Of course, certain bulky or hazardous goods may still require independent shipping. But in most cases, FBA streamlines operations for heightened returns.

Key Takeaways

To summarize, here are the key selling habit takeaways from over 1,500 Amazon retailers:

• Smaller stores succeed regularly, debunking myths of only large brands
• Diversify sales beyond Amazon alone to eBay, Rakuten, etc. for redundancy
• Pursue in-demand categories like home/kitchen, toys, and books that drive traffic
• Leverage fulfilment by Amazon wherever feasible for boosted profitability

By analysing this data, you gain valuable industry benchmarks to assess your own strategies. Make adjustments in areas lagging your competition for enhanced growth going forward.

Now let’s dive deeper into some frequently asked questions.

FAQ

How often do top sellers promote their products?

Most engaged in some level of regular promotions like discounts, giveaways or bundle deals. Specifically, 27% promoted daily-weekly, 38% did so monthly, and 35% only for major sales events. Consistent yet targeted deals seemed to yield the highest returns.

What products have the best profit margins on Amazon?

According to market analysts, high-margin categories tend to include consumable goods that customers purchase frequently like food, household supplies, and personal care items. Digital products like ebooks and online courses also see strong earnings due to virtually no manufacturing costs.

What is the average shipping time for FBA orders?

For domestic U.S. orders, the typical FBA shipping times are:

• 2 days for Prime eligible items
• 3-5 business days for non-Prime Standard orders
• 1-2 business days for Expedited Shipping upgrades

International shipping windows vary based on destination country but average 1-2 weeks. FBA handles all order fulfillment so sellers don’t manage logistics directly.

How can I boost my search rankings on Amazon?

Some top strategies include optimising product listings with targeted titles and bullet points, achieving the coveted Amazon’s Choice badge, earning high customer reviews, leveraging Amazon Advertising like Sponsored brands and products, and creating educational content through blogs, videos and backlinks. Consistent product data quality also enhances search placement over time.

What sales volume is needed for the Professional Selling Plan?

To qualify for the Amazon Professional Selling Plan, sellers must maintain a trailing 12-month sales total exceeding $10,000 and be in good standing. The benefits are slightly reduced fees on monthly product sales and advertising expenditures. However, volume requirements may periodically change, so confirming directly with Amazon is wise.

Do Amazon sales count towards a home business tax deduction?

In many cases, yes, earnings from an Amazon reselling business operated out of your home could qualify you for the tax deductions available to home-based entrepreneurs. Specifically, you may deduct a portion of your household utility bills, rent/mortgage interest, insurance, and other office-related expenses incurred through running the company from your home. Be sure to consult a tax professional to determine eligibility based on your individual tax situation.

Conclusion

By analysing the behaviours of over 1,500 successful Amazon retailers, this guide revealed patterns that can optimise your approach. Whether big or small, diversifying sales beyond Amazon alone, prioritising in-demand categories, and leveraging fulfilment services boost sustainability.

Regular promotions and continual search optimisation further engage customers. Remember, benchmarks indicate opportunity remains regardless of company size. Approaching Amazon as both a science and an art sets apart high-achieving brands.

I hope you find these insights useful! Please let me know if any other questions arise. I wish you all the best as you grow your business.