How Do You Sell on Amazon?
Selling online is easy. Making money online is another story entirely.
Amazon offers different programs that give people the ability to sell online. A big question that I hear is how do you sell on Amazon?
Descriptions of Amazon's selling programs are available on its website. What's missing from these is the reason to chose one program over another or to whether to even participate in the first place. My goal is to help you understand what the programs are, how they are different, and whether it is something that would fit into what your goal of making money online.
Disclaimer: There are links within this article that may result in a commission to the website owner should you make a purchase from those links.
Various Methods of Selling on Amazon
- Fulfillment By Amazon (FBA)
- Amazon Associate Program
- Sell as an Individual
- Sell as a Professional
- Build an Amazon Webstore
- Advertise Your Products
- Publish via Kindle and CreateSpace
Fulfillment By Amazon
This method allows you to send your products to an Amazon warehouse along with information about it's price and your business and Amazon will handle the processing of the sale. This option is perhaps the most complicated way to sell using Amazon but once you have your product at Amazon's warehouse, there's not much else you need to worry about. Amazon handles the transactions, takes the fees associated with that transaction and pays you.
The program is too extensive and will bloat the content of this article by including the details. Since it is already spelled out by Amazon, simply use this link (opens in a new window) to find out more about the program.
Amazon Associate Program
Amazon calls this its associate program but it really is an affiliate program. There are some good and not so good aspects of the associate program. Let's start with the good:
- You can sell just about any product that Amazon carries.
- Amazon pays based on a tiered commission program that increases as you sell more. The commission is retroactive within the selling period. Older sales get a boost.
- Amazon sole purpose is to sell products and they are good at it. Readers don't go to Amazon to hang out. They are there to find products with credit card in hand (for existing customers that credit card is on file).
- There are several different formats to choose from including widgets and what they call the aStore that can be added to your website.
Here are some of the not-so-good aspects of the program:
- People living in certain states are ineligible for the program due to those states' Affiliate Nexus laws.
- The starting commission is a dismal 4% for most items. Sell a $20 item and your looking at eighty cents for your commission. Granted, there is a tiered pricing as described before but you have to get that within the sales period.
- It's widely believed that Amazon is not very affiliate friendly. There are many provisions in its terms of service and it is wise to make sure that you familiarize yourself with them. They can and do ban affiliates forever.
- Amazon makes the rules. You could be doing extremely well with associate sales and Amazon decides for whatever reason to discontinue your associate partnership. Your state could adopt the Affiliate Nexus laws, etc., or for any reason Amazon deems fit. It's important to depend solely on Amazon as your source of income.
- Amazon cookies are only good for 24 hours. A cookie is a way of identifying associates by writing a piece of code (simplified) on the browsers of its customers. Within the 24 hour period, if that customer buys anything the associate will get the commissions.
To learn more about the program use this link: Amazon Associate Program
Sell as an Individual
If you have a small number of items and are willing to ship them yourself, you can choose to sell as an individual. The advantage here is that Amazon will handle the order processing while you will be responsible for shipping the item. When you ship, you alert Amazon to the fact.
There is no monthly charge for you to participate but the fees are going to be higher than were you to choose to sell as a professional (described next). Amazon suggests choosing this option if you sell below 40 products a month.
Sell as a Professional
This option costs $39.99 per month but the fees that you pay are much less. Amazon draws the line in the sand at 40 products per month as being worthwhile to use this option. But the true "line" is wherever your breakeven point is. If you sell 40 or more items but still cannot make a profit beyond $39.99 (plus whatever other fees charged) you won't last long in that game.
For more information on both of these programs, use this link.
Sell on Kindle and CreateSpace
If you have had any inclination to write a book or short story, publishing your book on Amazon's platforms (Kindle and CreateSpace) can be a great way to sell that book. Most are familiar with Kindle but CreateSpace.com is an Amazon owned website that produces Print on Demand (POD) books. This means that they are only printed when the customer actually buys them thus eliminating the need to mass produce hundreds of copies of your book before even selling. This has saved serious bucks for authors.
You will need to decide whether you are going to take advantage of Amazon's Kindle Direct Publishing (KDP) program. Like anything, there are advantages and disadvantages to each. Here are the advantages:
- Any five days out of the 90 that KDP Select program runs for, you can offer your book either for free or as a countdown reduce price (which incrementally increase as you closer to the specified date). These incentives can really get your book noticed and can help get you reviews (which sell more books later). Plus you can announce that your book is available (free or discounted) on forums and social channels, etc. It's important to note that you can't mix and match the countdown or the free. When you choose one that is the one you have to stick with.
- Amazon will promote books that start doing well which can really boost the sales of your book.
- The commission that you get for KDP Select is much higher than the standard commission listing.
- You can take advantage of the Kindle Matchbook program. If you created a CreateSpace listing for you book, Amazon will offer the Kindle along with it at a bundled price. This can lead to many more sales.
Here are some of the Disadvantages:
- You cannot sell your book anywhere else for the 90 day period. This does not include CreateSpace.
- You must list your Kindle book between $2.99 and $9.99. This may be okay but if you are looking to use your book as a promotional item (with links to your website, etc.) it's much easier to sell at 99 cents.
For more information on the KDP program, click http://kdp.amazon.com
For more information on CreateSpace, click http://createspace.com
Build an Amazon Webstore
Amazon has an ecommerce solution that you can take advantage. You essentially upload products that you want to sell and you can include in the mix most of Amazon's products. The fee at the time of this writing is $79 and carries a 2% transaction fee.
You can get more information about that program here.
Advertise Your Product
Amazon has a Pay Per Click advertising program similar to Google's Adwords. The program is geared towards people that want to sell products on their own websites. You would send the traffic to your product page and pay only for clicks to that page. The advantage of this program is that you only pay for clicks that you get and the advertising is targeted on a website (Amazon) that gets lots of traffic. The only obvious disadvantage would be the cost of click depending on the type of product you are listing.
At the time of this writing Amazon is offering a $75 in free clicks to help you see if the program can work for you (be sure to read the restrictions on this offer). You can read more about the program here.
Should You Sell on Amazon?
Given all the information in this article, you should have a better idea whether these programs are right for you. Keep one thing in mind, it is not going to be a smooth ride to the top. Selling is difficult no matter what platform you do it on. So you need to prepare yourself for serious road blocks along the way. Just keep focused and learn as much as you can in order to do it right. And be aware things can change very quickly for any of the types of business models that you may participate in.
Why is it Most People Don't Make Money Online?
Enter your name and a valid email below
and we'll give you the EXACT reasons why!
