From years of experience, I have found a strategy that has helped me and dozens of Just One Dime students become millionaires.
Today, I will walk you through eight steps to find a product that can make you $20,000 profit a month on Amazon.
Step 1: Choose a brandable product category.
When you have a brand that people love, people will pay a lot more. For example, people will pay excessively more for a shoe if it's a Nike product. Rare Nike shoes have sold at auction for nearly $52,000 not because they were magic shoes but because they were Nike brand.
And, yes, building a brand can translate into a ton of dollars and cents for your Amazon store. One Amazon seller I knew was able to sell their store for 55x the annual profit of that store.
Tens. Of. Millions.
Why would the buyer invest in a store that couldn't promise their money back for 55 years? The buyer invested in the store's brand value. 💵
What makes a product brandable? It tells a story.
Consider the Saddleback Leather company. Their slogan: They'll fight over it when you're dead.
It comes with a 100 year warranty...
Their brand tells me a story that's more than "durable products." Their bags will outlive you, and the quality is such that relatives will fight over it. It's rustic, western, and worth paying more for because it never needs replacing.
But you are not Nike or Saddleback Leather. Are Amazon shoppers going to find and love your brand? One thousand times "Yes!"
Statista did a massive survey asking Amazon customers a simple question: “How often do you use Amazon to discover new products or brands?”
About 50% of the respondents said they do sometimes.
Over 23% stated they do this frequently.
With over 100 million Amazon customers, that means almost 25 million shoppers are frequently hunting for more brands to discover on Amazon and over 50 million shoppers are looking "sometimes."
New brands can become household names when they tell stories.
Step 2: Choose a product category you can pour your heart into.
If you're passionate about your product, you will do a much better job at building an excellent product and a brand experience.
What do you love to do?
For example, if you love cooking, why not sell skewers? If you love exercise, sell fitness equipment. You sleep. A new brand has recently burst into the scene selling a cube pillow. They make $200-$300 revenue on a foam pillow cut into a cube. The founder of that company poured their heart into something they could love.
However, just because you like it doesn't mean customers are going to like it. Do not let your love for the product blind you from what the customer needs.
If you have to choose between a product that will make you a lot of money, like a glass chalice, versus a product you find more interesting, like a replica pirate sword, consider the market. If there's not a market for pirate swords, sell glass chalices instead. 🍷 🚫 🏴☠️
Here's the sweet spot: You've found a product that you love and has a strong demand.
Step 3: Choose a product category you can build into an experience.
When you pick your brand, understand that you are not choosing a brand; you are choosing people.
I have seen sellers obsess over the perfect logo and the perfect brand name. But those aren't what make your brand powerful. It's the brand experience you provide and the trust shoppers put into your brand experience.
If you own an athletic shoe brand, it's not the brand name or logo that matters. What matters is the story you tell and the brand experience you create using that story.
For example, "Nike" is a meaningless word in English; it comes from a Greek word meaning "victory."
According to legend, after the Greeks won the battle of Marathon, the Greeks sent a runner to Athens, 26.2 miles away. When the runner got there, he shouted, "Nenikēkamen!" (victory) and then died on the spot from exhaustion. That's why modern day athletes run 26.2 miles to complete a marathon.
Do you think shoppers saw the brand name "Nike," looked up what it meant and then said, "That's a cool brand name. I like that brand now?"
No. Nike could have been named, "Papoútsi," (Greek for "shoe"), and it wouldn't have made a difference.
Additionally, Nike's swoosh logo has no intrinsic meaning. It looks kind of like a curvy checkmark ✅. People don't wear large swoosh logos on their t-shirts because the logo itself is cool. They wear the swoosh logo because they like the brand associated with the logo. That logo wouldn't be worth anything without a specific brand experience behind it.
Nike wouldn't be a powerful brand if they said, "Here's a shoe. Here's a logo. Here's a brand name."
Shoppers do not buy things. They buy experiences.
Nike doesn't sell shoes. They sell an experience: athleticism and action. Their brand story is reflected in their slogan: Just do it.
When people buy tea, what they're actually buying is the rejuvenating, tasty, warm feeling they get on a cold morning. If you build a tea brand, don't sell the leaves. Sell the experience.
When people buy a clothes steamer, they're actually buying wrinkle-free clothes. If you build a clothes steamer brand, sell the smooth, professional look of their clothes.
How do you pick a product category that builds an experience?
Pick a product sub-category. Niche down.
Nike is not just a shoe brand. It's an athletic shoe brand.
Other shoe companies like Prada don't sell athleticism. They sell sophistication and elegance.
The more specific you become, the more effective you will be when you build your brand experience.
Here's why: If you're just thinking about selling clothing accessories, who is your target audience? What gender? What age group? Are they city or rural residents? Blue or white collar? But if you sell top hats, you have a much clearer vision of your clientele.
Stop trying to sell to everybody. Sell to one very specific group of customers who absolutely obsess about the experience you are going to create for them.
Step 4: Choose a high-demand product.
When I say high demand, I mean that a lot of people are willing to pay good money for a product. Therefore, you can measure demand by sales volume.
Study the sales of the top ten organically ranking products for your keyword to estimate demand for your product. Why only the top ten? They are the only competitors that matter. The listing on page 687 does not matter.
If at least five of your top ten competitors are pulling in high sales volume, then your market has potential. Even better if nine or all ten competitors are making great sales. That means one or two products are not dominating the market.
When shoppers buy from a variety of brands, that means there is little brand loyalty—which means that shoppers are more likely to be open to your new brand.
Use a product research tool such as Niche Hunter to gather the most important data for choosing a product to sell.
We at Just One Dime developed Niche Hunter to help you find the demand, ease of entry, and differentiation opportunity for the top ten organically ranking products for whatever keyword you enter. This way, you can focus on the relevant data you need to make a decision.
Let me show you how to use Niche Hunter to determine demand using "hunting bow" 🏹 as an example:
Niche Hunter is telling me that six of the top ten ranking products for the term "hunting bow" generate over $20,000 a month each.
However, your qualifications for "high demand" don't need to be $20,000. There is no number set in stone.
But, I did say that I would help you find a product that can make you $20,000 profit a month. Therefore, assuming a 40% profit margin, you need to find a product that will bring $50,000 in revenue per month ($50,000 x 0.4 = $20,000).
Click on the gear in the right corner to adjust your revenue floor to any amount you are comfortable with.
You will see a pop up that allows you to adjust your parameters.
Type your desired revenue in the corresponding box and click "Save Changes."
When you change the revenue floor to $50,000 for hunting bows, Niche Hunter says that only three of the top ranking products are making that much money a month.
Why does Niche Hunter say "Poor Market?" If five of the top ten organically ranking products for a keyword don't meet the demand or ease of entry criteria you set, then Niche Hunter will display a poor market status.
Step 5: Choose a low review acceptance product.
Some of your top ten competitors should not have too many reviews. Most of your competitors should only have as many as 325 reviews. Preferably 100-200. Why? Because when you create a brand new listing, your product will have zero reviews.
When five or more of the top ten ranking products have a low review count, that tells me shoppers will still buy these products even when a listing has a small number of reviews. This means that your niche-market will be "easier to enter" than other markets.
Niche Hunter will show you when a niche meets this criteria.
For example, Niche Hunter shows that six out of the top ten product results for "hunting bow" have under 325 reviews.
Step 6: Choose a differentiable product.
This is the #2 mistake Amazon sellers make (#1 is not building a brand):
They don't think about the fact that your product must offer value that no one else is offering.
If you were to create a new listing for a product that looks the same and performs the same as similar products that already have 300+ reviews on Amazon, why should a customer choose your product? You could lower your price, but price wars are a race to the bottom in which no seller wins.
You have to make your product better. Today, I will show you three methods to build a differentiated product:
1) Build a better solution to an existing problem.
Look at your competitor's reviews. If customers are bothered by the same issue among all of your top competitors, then shoppers want a solution that does not yet exist. Offer them that solution and rake in sales.
For example, if buyers all complain that toothbrush bristles are too firm, then offer softer bristles. This way you are improving an existing product. Your solution to dirty teeth is now better than the existing solution.
2) Build a new solution to an existing problem.
Here, you are solving the same problem but in a different way.
For example, an electric toothbrush solves the same dirty teeth problem, but it is not the same product as a manual toothbrush and solves the problem in a new way.
3) Build a new solution to a new problem.
This differentiation strategy has you solving a problem that customers either didn't know they had or a problem they've become complacent with.
For example, people used to be complacent with plaque build-up in between their teeth because toothbrushes couldn't clean well in between teeth. And then floss came out in the 1800s. The inventor of floss created a brand new market. Floss is neither an improved toothbrush or a new version of a toothbrush. It's an entirely new product.
Which differentiation strategy should you pursue?
If you're short on funds, start with method #1. Find a problem with a product and fix it.
If you have a decent amount of funds, go with option #2.
If you have business experience and are ready to come out with patents, go for option #3. This is the biggest risk, but it comes with the biggest reward.
If you're afraid of risk, you will not succeed at reaching your dreams.
How do you know if a product is differentiable?
If products are both selling well and have under 3.5 stars, that means shoppers want the products so badly that they tolerate it because nothing else better is being offered. This means huge opportunity for you.
Niche Hunter helps you find differentiation opportunity by showing you how many of your top ten competitors have a rating less than a number of stars that you determine (3.5 stars by default).
If your competitors don't have low star reviews, that does not mean that the product has no differentiation opportunity. All of your competitors could have a solid 5 stars. There may still be a way to improve the product. Low star reviews are simply an easy and fast way to find ways to improve a product.
BONUS: Use these three places to find differentiation opportunities for your product:
1) Use critical reviews to find solvable problems with your competitors' products.
Find out what customers hate and fix the problem. Find out what they love and reinforce that solution. This reviewer stated exactly what they wanted in a golf bag:
2) Use the "Products related to this item" and "Frequently bought together" sections on Amazon to find bundling opportunities.
Amazon will suggest complementary products.
3) Use online interest groups to find out what your customers are looking for in a product.
Online interest groups host some of the most passionate niche buyers on the planet. Find out what they want to buy and sell it to them.
Step 7: Choose a high-profit product.
It doesn't matter how much money you generate if you don't have good profit margins. How do you find a high-profit product?
1) Choose a high-ticket product.
More expensive products have a greater potential for high-profit margins.
Each product will have fixed costs regardless of price. These fixed costs eat away a smaller proportion of the high-ticket product's profits.
Additionally, PPC ad costs will tend to be higher for cheaper products because more sellers want to sell in cheap product categories.
PPC works like an auction. The more sellers there are, the higher sellers will end up bidding to outcompete the crowd. In other words, the more demand there is for PPC on a keyword, the higher the price of that keyword will go.
Low ticket items move money more than they make money.
For example, consider two nanny spy cameras:
- They are the same size and weight but one is more advanced.
- One is selling for $50, and the other is selling for $20.
- Shipping costs are based off of size and weight, so it is the same for each (approx $2).
- FBA fees are the same for each ($6).
- PPC is similar because these products compete for the same keywords ($1).
Fixed costs subtract a higher proportion of the $20 camera's revenue (45%) than they subtract from the $50 camera's revenue (only 18%). Therefore, your profits will be higher when you sell $50 spy cameras.
2) Ensure a minimum 40% profit margin.
Use Niche Hunter to find your profit margins for a product.
Say you are interested in selling golf bags. Tab over to "Top 10 Products."
Click on one of the product previews.
You will see a product details pop-up window like this:
Niche Hunter is telling you that in order to make 40% profit on each golf bag that you will have to be able to buy each unit from your supplier at $36.21 or less, including shipping. You can adjust this profit margin percentage, but 40% is our minimum recommendation.
When you hover over the "i" in Niche Hunter, it shows you the net proceeds estimate. Niche Hunter will use the listing's sell price. You could change the price from $80.46 to whatever price you plan on selling your product for.
How do you know if you can get your product for the cost of $36.21? When you click on "Source on Alibaba," Niche Hunter pulls up a search for your keyword on the sourcing website, Alibaba.
Golf bags on Alibaba are priced well under $36.21, which means you can sell them at 40% profit margin.
3) Do not fear heavy or large products that can make you a ton of money.
Even if your product is as big as a house 🏠, you can still sell it—if you have good margins.
Most sellers won't even try it. They're scared of large and heavy items. Good. More money for you.
If you know your numbers, you can make money selling anything.
How do you know your numbers? Use Niche Hunter. It shows you your numbers.
Step 8: Choose a product that can come in variations.
If you're selling a golf bag, you can come out with bags in different colors. Or you could sell a large, medium, and small bag. Or one with one strap, and one with two straps.
This allows you to:
- Build a brand around your niche
- Increase profit margins massively
When you pick your product, think of how many variations you can come out with. Chances are, you can get it all from the same supplier. Cut a deal. Ask your supplier something like, "If I order 300 green, 300 black, and 300 red, what kind of discount can you give me?" That supplier will love you because they will make more money, and you will make more money.
When you first launch a product, your margins will be zero. At first, you won't make money. It might take you a month or more before you start seeing profits. The more risk you can afford to take, the more money you will make.
Remember, Niche Hunter can help you on your way to make $20,000 profit a month per product on Amazon.
To watch a step-by-step video version of this blog, click below.
And to watch step-by-step videos on building and running a successful Amazon store, start to finish, visit JOD.com/freedom.