But with so many categories, how can you keep track of them all and pick the one that’s right for you?
Today, I will walk you through all the Amazon product categories Just One Dime recommends to sellers so you can choose the best category for your store.
Read all about creating an experience for your customers with your products that all starts with choosing your product category in this post. However, here I will give you a rundown of the actual Amazon seller product categories you should sell in—complete with the pros and cons of each one, plus their referral fees.
Understand referral fees.
As you consider which product category you will sell in, consider referral fees.
Referral fees are the fees you pay per transaction.
Referral fees vary by product category, although they are most commonly 15% of each item sold. Referral fees do not include your FBA fees that you pay Amazon to fulfill and ship your orders.
Ungated and recommended product categories:
Ungated means there are no restrictions to most sellers to sell in those categories. Gated categories require special permissions. Most sellers must apply in order to sell in gated categories.
The following categories are both ones you can start selling in right away (ungated) and that we at Just One Dime recommend to sellers.
Appliances: The referral fee can be either 8% or 15%.
This category is for large appliances (refrigerators, washing machines, etc.) as well as compact appliances (air fryers, space heaters, etc.).
This is a strong opportunity if you have low cost logistics for FBM, fulfilled by merchant. Amazon storage fees can get pretty high for this category, which means FBM may actually net you greater profits than FBA. However, if your profit margins are high regardless of size and weight costs, this is an excellent opportunity to sell products FBA.
Arts, Crafts, & Sewing*: The referral fee is 15%.
This is a slightly less popular category both for shoppers and sellers. However, with it comes the advantage of low competition and relatively easy market entry. This category also affords you room to express your personal creativity into your products and brand. If you have experience selling on Etsy, this is a great category for you.
*For some seller accounts, Arts, Crafts, & Sewing may be a sub niche under the Health & Household product category.
Automotive: The referral fee is 12%, except for tires and wheels which only carry a 10% referral fee.
This is a powerful category for sellers with specialized knowledge or strong experience in this industry, such as a hobbyist or a mechanic.
Baby Products: The referral fee can be either 8% or 15%.
If you sell in Baby Products, you can build an avid following of parent customers who love and trust your brand. Understand, however, that even though this is a good product category to get into, many of the products within it require seller certifications. There are also fewer product options in this category than in others. But it can still be extremely profitable.
Beauty & Personal Care: The referral fee can be either 8% or 15%.
These are higher risk products because they are meant to go on or in the body. Therefore, there is a higher barrier to gain consumer trust in your brand. However there are massive opportunities in smaller accessories.
Social media influencers are key to successfully selling and building a brand in this industry. When you work with an influencer, they will advertise your product to their devoted audiences. This means you can build your brand while piggybacking off of the influencer’s built-in audience trust. Win-win.
Cell Phones & Accessories: The referral fee is 8%.
This is an extremely competitive market with a low price point, which makes it challenging to profit, especially if you sell accessories. However, if you niche down into specific accessory subcategories, you can find some gold mines.
Clothing, Shoes, & Jewelry: The referral fee can be either 5%, 17%, or 20%.
There is a lot of saturation in this market. It can be hard to build a strong consumer following, especially when you start in main items like dresses, coats, shirts, etc. However, if you start in accessories like headbands, for instance, you can more easily build brand loyalty and then expand into bigger ticket items.
Also keep in mind that Jewelry is a gated category for most sellers.
Electronics: The referral fee is 8%. The referral fee is lower because the majority of electronics tend to be lower cost products which means the referral fee takes a larger chunk of your revenue.
This is the number one most popular shopping category on Amazon.
Electronics often come with certification requirements that—coupled with lower product price points—can make this a more challenging market to succeed in. However, there are huge opportunities here where the competition is not over-saturated. If you niche down into a specific subcategory, you can dominate your market.
Handmade Products: The referral fee is 15%.
This category is Amazon’s way of taking on Etsy. You can sell homemade items such as beauty products, clothing, decorations, gifts, jewelry, etc.
To succeed in this category and build a strong brand, you will need to set up a scalable system for handmade production. Without one, you’ll either have to spend hours making products yourself or hire staff to do production for you. And keep in mind, the more custom options you offer your customers, the harder it is to scale.
Health & Household: The referral fee can be either 8% or 15%.
This is an excellent category to build a strong brand in. Many Amazon sellers find great success selling products in both this category and Beauty & Personal Care all under one trademarked brand name.
Keep in mind, this category does include some higher risk products that could go on or in the body, which means you might need specific certifications. This also means you’re more liable for a lawsuit in case a customer was to get sick as a result of your products.
Home & Kitchen: The referral fee is 15%.
This is the most popular category for Amazon sellers. It feels easy to most sellers, which creates more competition, even though it is not the category with the most shopper demand. However, it is still worth tens of millions of dollars in revenue. There is money to be made here when you niche down to a super specific subcategory.
Industrial & Scientific: The referral fee is 12%.
This is actually one of my favorites. We have sold some extremely unique products in this category.
Industrial & Scientific is packed with hidden opportunities in unique niches. When you first start looking for products in this category, you might not find anything you recognize.
If you look closely, however, you can find some truly unique products with specific audiences who absolutely love those products. If you can produce a better version of one of these niche items—BOOM—you will have a dedicated customer base.
Musical Instruments: The referral fee is 15%.
This is probably one of the most underestimated, least talked about categories on Amazon. It is a small product category that has not nearly reached its full potential.
Brand loyalty does make it difficult to break into main products such as guitars, keyboards, etc. But there are huge potential opportunities when you produce accessories that complement the main products.
Office Products: The referral fee is 15%.
This is a growing category on Amazon and one that is particularly strong for business to business (B2B) sellers.
Nope, it’s not sexy. Yes, it can be boring. But it’s still a huge opportunity. The fact that it is a less fun category gives you an advantage. A lot of sellers won’t ever consider this category, which is ample reason for you to consider it.
Patio, Lawn, & Garden: The referral fee is 15%.
This is an excellent product category that is not even close to reaching its full potential.
A lot of shoppers enjoy going to Lowes or Home Depot on the weekends so they can work on house projects. They often love doing things with their hands, which means there’s something comforting about spontaneously going to a hardware store and physically buying an item to fix something right now as opposed to planning to fix something, ordering the product, and then waiting at least two days for it to arrive.
This is good news for you. The day will come when this product category will take off on Amazon. And sellers who get in early have a great opportunity to build up credibility and reviews before the market booms. If you have a knack for design, you’re good with your hands, or you’re a handy person, this could be a fantastic opportunity for you.
Pet Supplies: The referral fee can be either 15% or 22%.
In Pet Supplies, you have fewer product options than in other categories. However, if you understand pet owners and their deep-rooted love for their pets, you can build a profitable brand and brand following within this category.
Studies show that a large number of shoppers turn to Amazon for pet supplies. This means that there is still lots of untapped seller potential here. In fact, I know a seller who does $80 million in revenue in one year with his Amazon natural pet products brand, alone.
Sports & Outdoors: The referral fee is 15%.
This is the fourth most popular product category for Amazon sellers. Additionally, 17% of shoppers visit Amazon to shop in this category. That’s huge!
If you think about how many consumers shop on Amazon, 17% shopping in one category is crazy good. And it’s only going to grow.
Tools & Home Improvement: The referral fee can be either 12% or 15%.
Just 6% of Amazon sellers consider this category their main market, and it has only seen 2% seller growth over the past three years. This indicates both low competition and that competition growth is slow.
However, shoppers are gradually turning to Amazon more and more for tools and handy-type products, similar to Patio, Lawn, & Garden. This is a category I expect to grow a lot. And it comes with great opportunities for early sellers.
Toys & Games: The referral fee is 15%.
I’ve sold a lot of products in this category. It comes with tons of branding potential.
If you are driven creatively, you can launch brand new products in this category and massively increase your sales during the holiday season. For some sellers in this category, 70% of their revenue comes from the fourth quarter, alone.
In seller central when you list your product, it will ask you the age range for that product. I do not recommend you sell products for kids ages five and under (unless that is your dedicated specialty).
Small toys and toddler toys tend to carry safety risks and choking hazards, which means your product might require certifications.
Gated and recommended products:
You must apply to be ungated in order to sell in these categories. And at Just One Dime, we only recommend one gated product category:
Grocery & Gourmet Food: The referral fee can be either 8% or 15%, depending on what subcategory you sell in.
Amazon paid $13.7 billion to acquire Whole Foods in 2017. Now, Amazon holds 27% of online grocery sales in the US. They are just barely behind their closest competitor, Walmart.
If you understand food shelf lives and you have connections with food distributors, this is a huge opportunity.
I will not get into product categories we do not recommend, gated or ungated but here is a quick infographic to give you a list of these product categories.
In our experience, these categories do not lend themselves to creating a sustainable brand and/or private label business. And we want to set you up for success as much as possible!
Now, there are other factors to consider when picking a product category to sell in beyond the actual category itself. We could go on and on about Amazon shopper data, how to turn a product category into a brand story, etc.
Whichever you choose, let me know: What product category are you most excited to sell in?
