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E-Commerce series: monetize your brand

How to Build an E-Commerce Brand, Part 4: Monetize your Brand

Here we are again, with the “How to Build an E-commerce Brand” series! 

If this is your first time checking in, this series outlines all of the steps you need to take to create a profitable, fun e-commerce business.

Here’s what we’ve covered so far.

This week, we’re showing you how to monetize your brand, along with how to develop a sales channel.

For e-commerce purposes, a sales channel is usually a website where sellers can list and market their products to customers. The customers can be seller’s own audience (as detailed in the second part of this series), or a broader audience connected to the sales platform itself.

For example, if you sell your goods on Amazon or eBay, you are leveraging the customer bases shopping on those platforms for your own audience. 

Each sales channel comes with its own advantages, disadvantages, strategies, and tactics. While it would be impossible to discuss every single platform and its strategies in this article, I’ll focus on those that can best help you get started on Amazon as a private label seller.

How to monetize your brand and choose a sales channel

No matter which of the three methods I discussed in the first post of this series you choose, you can monetize your brand and develop your sales channel at any stage you like.

Start with the sales channel

E-commerce brands that start with a sales channel before they develop a product or build an audience are often more technical in their approach to e-commerce brand building.

For example, Amazon sellers can use Amazon’s metrics to forecast future sales for products they wish to sell. eBay sellers can predict future sales by looking at sold listings. Etsy and Shopify sellers can use Google to get an idea of what to expect from their niche.

And usually, those who start with the sales channel and Platform method are more focused on “hacks” for quick growth. (A hack is a way to circumvent slower, organic growth by doubling down on a strategy or tactic that your competitors may not have heard of — yet.

Use the sales channel your audience prefers

If you already have an audience in place, you can use a platform they prefer to interact with to sell your products and monetize your brand.

For example, digital content creators like me might use Patreon since it allows audiences to pay a monthly fee to gain access to special content. Or, if you’re a popular podcaster selling a camera tripod, you might direct people to an Amazon listing since most of your audience is likely familiar with how Amazon works.

Choose the best channel for your product

Finally, if you’ve developed a product already, you can select the platform that works best with your product.

While there are hundreds of online sales channels for you to choose from, here are some rules of thumb for sales channel selection based on product criteria. These are just basic guidelines, though, and you are by no means restricted by them.

  • Amazon FBA: Small, mass-produced products weighing no more than a few pounds that you can sell for $25 to $50.
  • Amazon FBM: Large, mass-produced products that are costly to ship, such as appliances, mattresses, and furniture.
  • eBay: Used items, collectibles, large collections of goods.
  • Craigslist or Facebook Marketplace: Large, new and used items that are difficult to ship, such as appliances, lawn care equipment, furniture, and vehicles.
  • Patreon or Kindle Direct Publishing: Low-priced (no more than $25) digital content.
  • ClickFunnels or Shopify: High-priced ($25+) digital products and services.
  • Etsy or Amazon Handmade: Handmade or 3D-printed products.

Recap: the Platform Method

Earlier in this series, I outlined three methods you can employ to start an e-commerce brand: the Passion Method, the Product Method, and the Platform Method. And each method uses a different strategy for brand-building.

Passion focuses on audience-building first. The Product Method focuses on product-development. Finally, the Platform Method concentrates on building a brand around a particular sales channel.

So, how do you monetize your brand using the Platform method?

Step 1. Learn about your sales channel

As I mentioned above, all sales channels are different. What works for eBay doesn’t necessarily work for Amazon and vice versa. So, it’s important to learn as much as you can about the platform you decide to use to monetize your brand. 

When I originally started my e-commerce brand in 2015, I started with eBay. At the time, it was the only e-commerce platform I was familiar with.

I listed a few products on eBay and was surprised to see they didn’t sell at all. Even after being active for more than a week, I had no sales. I was a little discouraged, sure. But I didn’t give up! Instead, I did some research and discovered that Amazon had similar seller programs.

Just like eBay, I could list my product and wait for it to sell. So, I did just that. And, in less than 24 hours, I made two sales. From there, I started learning all I could about Amazon.

Why use Amazon to monetize your brand?

Simply put, if numbers mean anything to you (and they should), Amazon dominates.

(Compare those statistics to eBay: eBay has a reported 25 million sellers, with roughly one-third the monthly traffic that Amazon sees.)

In addition, Amazon offers Fulfillment-by-Amazon (FBA). FBA allows Amazon sellers (or their suppliers) to send their products to Amazon’s warehouses. Once the inventory arrives at these fulfillment centers, Amazon’s employees sort and store the products on the sellers’ behalf. Then, when a seller makes a sale on Amazon, Amazon picks, packs, and ships the product to the end user. The seller doesn’t have to lift a finger.

In fact, Amazon handles all of the customer service too.

Thanks to the FBA program, sellers can focus on building their brand and product line. They don’t have to get mired in the day-to-day rigors of inventory and shipping.

Learn about Amazon

Since a lot of what I cover in these steps refers to Amazon selling, this guide introduces you to some of the information you need to become a successful Amazon seller. I recommend checking out these free resources to help get you started.

My Amazon brand-building experience

It took a lot of education for me to go from “I assume that Amazon works like eBay” to “I can make thousands of dollars per month selling my own manufactured products on Amazon.” 

I started my Amazon journey first with used books. Later, I learned about online arbitrage and read a few books on the subject. Eventually, I started creating my own products to sell on Amazon using the private label method detailed below.

And although I’ve been an Amazon seller for almost five years, I’m still learning new and cool ways to use the platform.

Step 2. Choose a product sourcing strategy

When you sell products on a sales platform, you need a product that works well within that platform. (Above, I gave some rules of thumb concerning the types of products that I believe perform well on particular sales platforms.)

But how do you find those products to sell? 

Listed below are three strategies you can use to find products to sell online, no matter what you choose as your preferred sales platform.

Keep in mind, though, that there are tons of strategies to sell products online. These are just the most popular:

Arbitrage

Arbitrage is the practice of buying discounted goods (and, sometimes, services) in one market and selling them at a higher price in another.

While arbitrage is easy to learn and perform, dealing with lower priced goods means it’s the most difficult method to scale. For that reason, I recommend using one of the other methods detailed below if you’re choosing Amazon to monetize your brand.

A platform like Amazon is better for products priced between $25 to $50,

Wholesale

When I use the term wholesale in reference to finding products to sell online, I am referring to sellers who purchase large volumes of products from another seller or supplier with the intent to sell the individual items separately. Also, wholesale products are often branded products that already have an established market. 

Like arbitrage, wholesale is easy to understand and perform, as it doesn’t require you to create or manufacture your own product. But, wholesale does have its own challenges.

Its biggest challenge is that it is highly competitive. However,  its “race-to-the-bottom” mechanics — multiple sellers reducing their prices in order to compete on a mutually shared sales platform — is also problematic.

Private Label

Private label, sometimes called white-boxing, is a method that involves having your own products manufactured under your own label.

Similar to wholesale, you are buying bulk goods at a lower price, then selling them individually. The difference, though, is that because the items are created with your own brand label, the products are exclusive to you and your business.

The most popular sales platform to sell private label products is Amazon. You can create your own listing and have Amazon’s Fulfillment-by-Amazon (FBA) platform handle the transactions on your behalf. 

Perhaps the biggest benefit of private label is that a private label businesses can perform research in advance of purchasing the products in order to determine the potential profitability of the product. More details on this below.

And while the private label strategy is the easiest to source and is usually the most profitable, it is also the costliest of the three strategies mentioned. A private label seller can expect to spend upwards of $2,000 – $5,000 on a shipment of products just to get started.

How to research products on Amazon

Ideally, you want to find a product that has high demand and low competition. It should also be easy to ship, and shouldn’t have any sort of legal risks.

When you select Amazon as your sales channel, you can actually use Amazon’s own data to find profitable products. There are a few different ways to perform product research on Amazon, though I recommend using Jungle Scout’s Extension to do research.

Once you have the tool, log on to Amazon and search for a product you might be interested in selling.

For example, I’m going to do a search for the phrase “dungeon tiles”. Once the search results load, click on the JS logo to the left of your Google search bar. This will open the extension.

The extension organizes all of the data on search page for us to see clearly. Plus, it offers the average monthly and daily sales for each listing, then gives it an average. Finally, it awards the search an “Opportunity Score”. This is a rating of the product’s viability. 

For example, we can see that the products returned for the search term “dungeon tiles” have an average of 225 monthly sales, and an average sales price of $27.96. The products have an average of 93 reviews each, resulting in an Opportunity Score of six. That means “dungeon tiles” are in medium demand and experience low competition.

What sort of criteria should you look for?

I mentioned before that you want a product that has high-demand and low-competition. Here are a few good rules of thumb for finding such products.

  • The first 10 sellers in the search should have a combined total of at least 3,000 monthly sales. The first 10 “Dungeon tiles” were pretty close, with 2,544 monthly sales.
  • The first 10 sellers’ products should have less than 100 reviews each.
  • The products in the search should be easy to source and manufacture. They shouldn’t weigh more than two pounds either.
  • There are ways to improve upon the products. The best way to do this is to look at the average ratings for the first 10 products. They should have a star rating of 4 or less). It’s also a good idea to read the items’ 1-3 star reviews. It’s a great way to determine the products’ pain points.

If you have trouble thinking of good product opportunities, Jungle Scout offers a tool that generates product ideas based on criteria and filters you choose: Opportunity Finder

Step 3. Develop your brand

Once you have researched a product, sourced it, and established it on your sales channel, you will then need to focus on developing your brand beyond the product and platform. If you’ve found success and are earning profits as an e-commerce brand, this may come easily as you have an established revenue stream already.

Separate yourself from the sales channel

In order to distinguish and monetize your brand, you need to establish that it is unique from the channel on which you are selling.

If you’re using your own website as a sales channel, then you may have established this already. However, if you are a seller on eBay or Amazon — two sales platforms that make interacting with customers difficult — then you will need to find other ways to identify yourself.

Create a memorable product

A bright orange cover and the F-word are two things author Mark Manson can probably attribute his success to. His debut book, “The Subtle Art of Not Giving a F—” had both those things.

So, when the book appeared on Amazon, the fiery orange cover against Amazon’s stark, white background made the book stand out. Now, the risqué styled used by Manson’s book is duplicated everywhere on Amazon, including the Cookbook category.

Put your products in front of more people

One method for product promotion that a lot of big brands have started incorporating into their marketing strategy is the use of influencers. (An influencer is a personality who has the ability to affect the opinions and buying habits of their followers by recommending or demonstrating goods or services on social media.)

Popular examples of influencers include Kim Kardashian and Christiano Ronaldo. However, an influencer doesn’t need over a million followers to make an impact. Micro-influencers — influencers with follower counts of 10,000 or more — can also help promote products.

You can utilize influencers to get your product in front of more people, which in turn can help to monetize your brand.

You might use ads off your sales platform, too. Google ads and Facebook ads are both a great way to increase brand visibility.

And if you’re netting a profit on a sales channel already, you can use the earnings to increase overall brand awareness. This is an advantage that the other two e-commerce brand-building methods I mentioned earlier do not have.

See you next week

Hope you enjoyed this installment of How to Build an E-Commerce Brand. If this is the method you’re interested in pursuing, start off with these action items.

  • Learn more about a sales channel that interests you. We suggest Amazon due to its versatility and support systems.
  • Research a product that works with your platform.
  • Check sources for your products.

Let us know in the comments how you’re doing with starting your e-commerce brand and join our Facebook Group, Amazon Competitive Edge.

Next time, we’ll wrap up this series with details on how to improve and expand upon your e-commerce brand. See you then!

 

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