How do you find that elusive million-dollar product? The key is to find a product that will generate $3,000 a day, which will put you over $1,000,000 in revenue per year. There are three things to keep in mind when searching for a product: high purchase price, high sales velocity, and high weight and size. (Normally, I’d say find a product that’s under a pound, but in this case, let’s step outside the box and differentiate ourselves from the competition.)
3 qualities of a million-dollar product
1. High Purchase Price. The higher the purchase price, the fewer sales you’ll have to make to generate the cash you want. Products that sell for more money will have a larger margin for profit.
As a general rule, products that sell for between $30 and $100 will have a much better profit margin than products in the $10 to $20 range. Why? Because Amazon will charge you a minimum fee, no matter the price of your product. An item with a higher purchase price will leave you a larger margin to put money into PPC ads and product differentiation.
2. High Sales Velocity. What do I mean by high sales velocity? I mean a product that sells really fast – a product that sells multiple times per day. Now, it’s harder to find a product with both high purchase price and high sales velocity, but it’s possible! Putting time into research is worth it to find a product that will stand up to competition.
3. High Weight and Large Size. A larger product not only sets you apart from the competition, but also gives you more room to differentiate. Most people try to sell smaller items on Amazon, so selling larger products automatically puts you in a category with fewer competitors. So, go for a larger product, and differentiate the heck out of yourself!
Searching for a million-dollar product on AmazeOwl
What I want to do now is actually open AmazeOwl and take you step-by-step through the process of finding a product that meets these three standards.
Keep in mind that with this method, you’ll be spending a larger amount of money up-front to buy and ship larger, more expensive inventory. But that initial investment will pay off, because you’ll have less competition, so in the long run, your product will sell better.
First things first – open AmazeOwl and check your settings. Change your price range to $50 to $100, change your review count range to zero to 500, and set the weight high at seven pounds. For package size, we’ll go big at 100 inches. Leave all the other settings the same, then click “hunt for products,” and “hunt best sellers.”
Let’s try a keyword... “weight.” A few things will come up – weight scale, weight loss, weight gainer. Weight scale is a popular keyword, but a typical scale might not reach that $50 to $100 price range. So, let’s try something a little more unique. Look for keywords that come before scale by putting and * between "weight" and "scale." You’ll get results like weight scale, bathroom scale, body fat scale, smart scale, etc.
Look for something promising. Here, I’ve found “Wi-Fi scale.” That sounds like a product that’s more high-tech than typical weight scales, which means it will probably sell for a higher price. It meets our criteria, so we’ll save it.
Back on the AmazeOwl dashboard, click on “potential products.” Start your research. Type in the main keyword, “Wi-Fi body scale” and click on the research tab.
There are eight competitors. From there, I can filter out irrelevant competitors by clicking on “competitors and reports.”
So, the number of competitors is encouraging, and the review number pretty good. The median review count is 445, just below the 500-review limit we’re looking for.
The ten top competitors I’ve found are doing 562 sales per day combined. That’s 50 sales per competitor per day. At $32,000 per day in revenue among ten competitors, that’s over $3,000 per competitor. $3,000 per day, 365 days a year – that’s $1,095,000 of yearly revenue. We’ve just found our potential million-dollar product.
Now, from here, I need to dig deeper into my research. Can I differentiate? Has the purchase price for this product been consistently high? My goal is to list my product at a lower cost than my strongest competitor, with better photos, a better description, and overall better perceived value. I want customers to look at my listing and know my product is the best choice.
By picking this product with a high sales velocity, a high purchase price (in the range of $50!), and a large size, we’re putting ourselves into a pond with fewer competitors, instead of an over-saturated ocean. That’s how you differentiate yourself from the competition and find a potential million-dollar product.