Summer 2024 is beating, and if you’re like many in the ecommerce world, you’re already knee-deep in the madness of the back to school preparation. As we settle back into our routines back from vacation, let’s dive into something that could make a big difference for your brand this year: launching on Amazon. This guide will walk you through when, why, and how to successfully launch your brand on Amazon, even if you’re just getting started.
Timing is everything when it comes to launching on Amazon. Usually, the best time to launch on Amazon is after you've nailed down your DTC strategy. You should be generating at least $50K to $100K per month in revenue from your own website before considering Amazon. At this stage, you’ve likely fine-tuned your product, figured out what resonates with customers, and have strong creative assets that convert.
If you’re hitting those numbers, you probably also have the capital to invest in a new channel like Amazon, which can take a few months to set up properly.
Amazon is the biggest digital mall in the world, with hundreds of millions of consumers shopping every second of every day. To give you a sense of its reach, Amazon controls about 49.5% of all eCommerce sales in the U.S., with over 2 billion visits per month. In 2022, they did a whopping $400 billion in net sales revenue in the US only. If you have big growth ambitions, Amazon should be part of your eCommerce journey.
The goal is to tap into Amazon’s massive audience, get your products recommended by their algorithm, and kickstart a flywheel of reviews and sales that can drive significant growth.
Launching a product on Amazon is a strategic process that requires time, effort, and careful planning. If you want to do it right, expect it to take about three months. The timeline may vary depending on how prepared you are as a brand and how many SKUs you plan to launch, but a well-thought-out approach is crucial. Here’s a step-by-step guide to help you navigate this journey successfully.
The first step in launching on Amazon is setting up your Amazon Seller account. You’ll need to decide between an Individual or Professional seller plan. For brands, the Professional plan is the go-to choice. It costs $39.99 per month and offers advanced selling tools, which are essential if you’re serious about selling on Amazon.
Once you’ve chosen your plan, you’ll need to set up your account details. This includes providing your business information, tax details, and setting up a business bank account for payments. Make sure all these details are accurate, as they are fundamental to your operations on Amazon.
After setting up your account, the next step is to create and refine your product catalog. Each product you list on Amazon needs a comprehensive product page, which includes a title, detailed description, and bullet points that highlight the key features of your product.
If you have a large product line, start with your top-selling SKUs. Focusing on your best performers initially allows you to build a strong foundation before expanding your listings. When creating product descriptions, think about both positioning and SEO. Use relevant keywords that will help your product rank higher in Amazon’s search results.
Creatives play a crucial role here. Amazon has specific guidelines for product images. Your product should fill at least 85% of the image frame, and you can’t use props, sets, or any extra accessories in the photos. Additionally, all images must be of the actual product. No graphic designs or illustrations allowed. These aren’t ads, they’re product photos, and they need to adhere strictly to Amazon’s guidelines.
Once your product listings are ready, you need to decide on your fulfilment strategy. You have two options: Fulfilment by Merchant (FBM) or Fulfilment by Amazon (FBA). Nearly half of U.S. Amazon sellers use FBA, and studies show that using FBA can increase total sales.
If you choose FBA, you’ll need to decide how many units to start with and send your inventory to Amazon’s fulfillment centers. It’s also essential to have an ERP system in place to manage stock levels and reorder efficiently. Running out of stock on Amazon can severely damage your momentum, as customers will be directed to your competitors if your product is unavailable.
Unlike your own website, where you can inform customers when a product is back in stock, Amazon doesn’t allow such direct communication. If your product is sold out, Amazon will immediately recommend alternatives, and you risk losing that sale permanently.
On Amazon, reviews can make or break your product. Before you start investing in ads to promote your product, it’s essential to generate authentic reviews. Amazon’s Vine program is designed to help with this. It connects merchants with pre-vetted reviewers, known as Vine Voices, who leave unbiased reviews.
Here’s how the Vine program works: You enroll your products, typically before or shortly after launch. Amazon then invites trusted reviewers to select and review your products. These Vine Voices members receive your product for free and are required to publish a review within a specified timeframe.
This program is incredibly useful for brands just starting on Amazon, but it comes with a caveat. The reviews are honest, and if your product is subpar, the feedback will reflect that. Be prepared for the possibility of receiving critical reviews, which can impact your product’s early reputation.
With your account set up, product listings created, inventory in place, and initial reviews secured, it’s time to launch and promote your product. Amazon’s internal ad tools are your best bet for getting your product in front of potential buyers. Start with Sponsored Products, Sponsored Brands, and Sponsored Display ads to increase visibility.
Don’t stop with Amazon ads, though. Coordinate your launch across all your marketing channels, including paid search, paid social, email, and SMS. The goal is to drive as much traffic as possible to your Amazon product pages, which will help you build momentum.
At this stage, it’s crucial to prove your value to the market. This means stacking positive reviews, generating consistent sales, and increasing your product’s authority on Amazon. Remember, you’re competing with millions of other products on the platform, so you need to stand out.
Launching on Amazon is challenging, but with careful planning and execution, it can be a significant growth channel for your brand. By following these steps, you’ll be well on your way to successfully launching your product and capturing the attention of Amazon’s vast customer base.
First up, let's talk fees. Selling on Amazon isn’t cheap, and there are several costs to keep in mind:
One of the biggest misconceptions about Amazon is that you don’t get valuable data from the platform. While it’s true that Amazon doesn’t provide as much first-party customer data as other platforms, the data you do get from Amazon Ads is still incredibly useful for optimizing your campaigns and scaling your business.
Amazon’s advertising platform offers a range of metrics that can help you understand and improve the performance of your ads. Here are some key metrics you’ll have access to:
Sure, Amazon’s data might not be as granular as what you get from Meta or Google, but it’s more than enough to help you optimize your campaigns. However, one significant tradeoff is the limited customer data you receive. Amazon provides only a hashed email and zip code for each customer, which pales in comparison to the detailed customer profiles you get from Shopify. This lack of data can make it challenging to build a comprehensive CRM strategy.
Launching a product on Amazon is just the beginning. If you have a strong product and launch correctly, Amazon can be an enormous growth channel. However, it typically takes a few months to get the flywheel turning. This means accumulating positive reviews, building sales momentum, and eventually getting favored by Amazon’s algorithm.
For successful DTC brands, expanding to Amazon can add significant revenue. Some brands have reported adding multiple eight figures to their topline revenue by leveraging Amazon’s platform. However, it’s essential to remember that nearly half of all online purchases in the U.S. are made on Amazon. If your brand isn’t on Amazon, you could be missing out on a substantial market.
Amazon isn’t for everyone, but if you have a strong product and are ready to scale, it can be a game-changer. The key is to launch strategically, optimize continuously, and be prepared for the investment of time and money. With the right approach, Amazon could be the boost your brand needs to reach new heights.
