Welcome back to the “How to Build an E-commerce Brand” series!
This series covers all the steps you need to start and grow an e-commerce brand — everything from identifying your brand to creating a product to utilizing a sales channel.
Here’s what we’ve covered so far:
- How to Build an E-Commerce Brand, Part 1: Identify Your Brand
- How to Build an E-Commerce Brand, Part 2: Find Your Audience
This week, we’re showing you how to pick a product for your e-commerce brand.
For a lot of e-commerce brands, the biggest hurdle is finding a great product to create and sell. I sort of happened upon mine.
In 2015, I knew I didn’t want to work in sales anymore so I went online and looked for ideas for businesses I could start. One that sounded pretty cool to me was selling used books. At the time, I didn’t know much about used books. They just seemed easy to find.
At this point, I didn’t have an audience or even a sales channel. But I found a product!
(Four years later, I’m still selling books. The only difference is that the books I sell now are my own books, which I wrote — because I built an audience first; ahem Part 2. Even though my methods are quite different than they were back in 2015, everything I learned from selling used books I still use today.)
However, this article is meant to help you figure out what product is right for you — and how to ensure that the product aligns with your brand and is profitable.
Here we go.
When is the right time to pick a product?
No matter which of the three methods I discussed in the first post of this series you choose, you can pick a product at any stage you like.
Start with the Product
Sam Zemurray, a wealthy businessman in the late 1800s and early 1900s, built his empire on a single product concept.
At the turn of the 19th century, bananas were all the rage. However, with the transportation methods available at the time, any bananas that were over-ripe at the start of the transport had to be discarded. The slow transit meant they would be blackened by the time they reached their destination.
With that information Zemurray decided that, since businesses were getting rid of the bananas anyway, he would buy them for next to nothing. And his empire was born!
Pick a Product for Your Sales Channel
This is one of the most popular ways to build an e-commerce business, and the one most third-party Amazon sellers use. Greg Mercer, the founder and CEO of Jungle Scout, started the Jungle Creations brand this way in 2015.
Knowing that he wanted to sell through the Amazon sales channel, Greg used the Jungle Scout Extension to search through Amazon’s popular seller categories. Eventually he chose bamboo marshmallow sticks in Sports & Outdoors. He then sourced the product, launched the sticks on Amazon, and built the Jungle Creations brand around them.
Pick a product your audience wants
Comedian Brent Terhune started creating funny videos to promote his comedy shows. After he built a sizable following of nearly 100,000 Facebook fans, he started promoting an “Emotional Support Beer Koozie,” playing off one of his popular gimmicks. He also sells shirts with his most popular quotes printed on them.
Many people who have a prebuilt audience work this way. They don’t pick a product for its profits, or because it works for a certain sales channel. Instead, they discover what their audience likes and then leverage it.
Choosing the Profitability Method
In the first part of this series, I outlined a few reasons why you would want to select the Profitability Model over the others.
The first big advantage is right in the name: profitability. Since you’re focusing on market research and market creation, you can develop products that are viable in terms of margin and scalability.
Also, the profitability methods is one of the easier methods for which to find funds. Crowdfunding platforms like Kickstarter and IndieGogo (and at some level, Patreon) help you test the viability of products before you sink too much into their development. You can also raise funds from investors based on your ideas.
Whereas audience-building is more passion-driven, and the Platform Method is about building your brand and overall e-commerce strategy, the Profitability Method builds your brand around a product — everything else stems from that product.
Good examples of brands that started with a product from which they later built their audiences and sales channels include the party game Cards Against Humanity, disposable razor company Harry’s Razors, and the Pebble Time Smartwatch.
For product-forward companies, the product, in essence, is their brand.
Most folks probably couldn’t tell you the name of Cards Against Humanity’s founder, Max Tempkin, but they are sure to recognize the familiar black box, the simple, san serif font, and crude humor that the card game is known for.
Step 1. Find a pain point
Have you ever found yourself saying, “Wow, I like this [insert gadget here] but I wish it had [insert feature/benefit here]?” Or maybe you’ve said something along the lines of, “I really wish there was a gadget that could do [action]?”
That is a pain point.
A pain point is a want or need that consumers have that may not be adequately filled by existing products or services. Once a pain point is discovered, entrepreneurs and product developers work quickly to fill that need.
One popular example of products that solve pain points are items sold through infomercials. In fact, they start with pretty much the same question, “Has this ever happened to you?” followed by a series of overacted situations involving mundane items.
Even if you don’t start with a pain point, you can listen to what others say regarding their pain points.
Maybe your neighbor wishes he didn’t have to deal with an extension cord for his leaf blower anymore. Or perhaps your wife mentioned how she wishes rubber clogs weren’t so unattractive (even if they are super comfy).
In response, you can look for ways to improve the product. Perhaps the leaf blower could run on a lithium battery? Or maybe you can take the technology used to create crocs and make a more attractive shoe.
You can also read through social media.
If there’s one thing that people love to do on social media, it’s complain. Look around for people who have trouble with day-to-day and mundane tasks, then try to come up with a solution for those problems.
Again, do the research and go a step further. When you pick a product, look for ways to improve upon what already exists.
Step 2. Perform market research
After you discover your pain point, you’ll want to see if there are others who share a similar want or need. There are a few ways you can go about this.
Survey your audience
If you’ve focused on audience-building, then you can just ask your audience what they want and need, or if they have pain points similar to your own. Before I launched my book series on Kickstarter in early 2019, I did just that. I came up with a concept, shared it on Instagram, and got feedback.
Check out similar products on Amazon
Another way to see if there is demand for a product is to check Amazon, the world’s largest search engine for shoppers.
All you need to do is perform an Amazon search of product concepts similar to your own and see what comes up. The idea it to determine if these similar existing products are in demand, and if there is a lot of competition in that niche.
The easiest way to do this is with a tool like Extension. While I go into more detail on how Jungle Scout’s Extension works in the fourth part of this series, here are some good rules of thumb for what to look for in a product on Amazon:
- The top 10 sellers of the product have an average of 300 sales per month each. This tells you that there is demand for the product.
- The listing qualities and average ratings for the products aren’t great — in other words, the existing products have room to improve.
- Among the top 10 sellers, three or more sellers have products with fewer than 50 reviews. This means there is low competition in the category.
Finally, the best way to determine whether or not there is a market for your product is to test its viability through fundraising.
There are multiple ways to raise funds for a product, but here are some of the most popular.
Crowdfunding is the practice of demonstrating the features and benefits of your future product, often with a prototype, typically on an online platform like Kickstarter or IndieGogo. People who help fund the idea, called backers, generally receive a reward in exchange for their funds. The reward is usually the finished product.
By listing your product on a platform like Kickstarter or IndieGogo, the market will tell you directly (by spending their dollars on your campaign) whether or not they are interested in what you have to offer.
If your campaign fails, it’s likely the market wasn’t ready for your product, or you didn’t advertise it well enough.
And, usually, when a crowdsourcing campaign fails, none of the money is collected. But if your campaign is a success, chances are that your intuition was correct: other consumers are experiencing the same pain points that drove you to create the product.
I’m sure you’ve seen the popular NBC show “Shark Tank”, or at least know about it. If you don’t, here’s the scoop: entrepreneurs or inventors pitch their product ideas before a board of wealthy investors. If the investors like an idea, they make offers to the entrepreneur to purchase a portion of their company live, which the entrepreneur can then use to launch or grow the company.
Of course, not everyone will be lucky enough to pitch their products in front of billionaires like Mark Cuban, but there are plenty of angel and venture capitalist investors out there with money to spend on cool concepts. And if all you need is a few thousand to get started, you might even be able to get a friend or family member to chip in.
Use loans/credit cards
Taking on debt is never appealing, but for folks who don’t have the marketing chops to launch a crowdfunding campaign (or don’t know anyone who would invest in their product), this is another way to get started.
Be sure to check with a financial professional to understand the risks before you consider this method though!
Step 3. Source your products
Once you pick a product and test its viability, you will need to source it. If your product is written or handcrafted, you can do this on your own. But if you have a product that you hope to expose to a broader market, it’s likely that you will need to mass produce it. There are a few ways of doing this, as well.
Find a manufacturer
The easiest way to create hundreds and thousands of products is by sourcing a factory. You can connect with overseas factories on sites like Alibaba, or you can use Jungle Scout’s Supplier Database, which puts you in touch with hundreds of thousands of manufacturers around the world.
Use a print-on-demand service
Some products — especially clothing, mugs, books, and posters — can be made to order by third-party companies like Cafe Press, Printful, and Red Bubble. The best part is that these products are dropshipped. You do not have to buy in bulk in order to supply your orders. Instead, once an order is made through your sales channel, you pass the order to the supplier who then creates and ships the order on your behalf.
Step 4. Choose a sales channel for your products
After you’ve sourced your product, you will need to find a way to sell it and fulfill your orders.
If you started off by testing the product’s viability through Kickstarter, the good news is that you’ve already made sales. All you will need to do from there is to fulfill the product order. Beyond Kickstarter, however, you may wish to find other ways to sell additional units.
Thankfully, in the huge world of e-commerce, the number of sales channels are seemingly endless. However, your best bet is Amazon.
Not only can you list your product on Amazon, but Amazon will store, pick, pack, and ship your product for you, through their Fulfilled By Amazon (FBA) program. Plus, they handle customer service, too.
I go into more detail about Amazon and their fulfillment network in the next episode of this series.
Step 5. Improve and expand
Finally, once your product is out in the wild, you’ll want to continue to improve and expand. Just as you learned a lot from your competitors by reading their reviews and judging the quality of their listings, you will want to review your own work and constantly work to improve your product.
But that’s not all. You may want to add new products altogether. Or you will want to find new audiences to target and add to your product line’s following. Maybe you can create new sales channels.
If your goal is to build a business, your first product is just the beginning. There will always be more work still to be done.
See you next week
Hope you enjoyed this installment of How to Build an E-Commerce Brand! And if this is the method you’re interested in pursuing, start with these action items:
- Think of 5-10 pain points that you regularly “suffer” from.
- Come up with ideas to solve each of those pain points.
- Check the demand for your products by surveying friends, family, and/or social media followers, and by using a tool like the Jungle Scout Extension to determine supply and demand for similar products.
Let us know in the comments how you are doing with starting your brand and join our Facebook Group, Amazon Competitive Edge.
Good luck and see you next time.