Online marketplaces and eCommerce platforms have made setting up an online store easy. However, the most important part of starting an eCommerce business is deciding what you’re going to sell.
Choosing the right items can be the difference between finding success and being stuck with a bunch of inventory that nobody wants. But how do you know you’re picking good products?
Below are five tips to help you select items that will allow you to build a profitable eCommerce business.
Sell Items You’re Passionate About
A good place to start is with products you know. What are your hobbies? What types of items do you use on a daily basis? Are there any products you’re especially passionate about?
Think about these questions and use your answers to come up with a list of items you’d be interested in selling.
Selling these types of products has a number of benefits:
- Knowledge: Because you use the items you’re selling you won’t have to do as much research. You’ll already know the important features and what to look for when choosing which versions and brands to sell.
- Promotion: As someone who’s a fan of the product, you already know what makes it great and understand why people will want to buy it. This makes creating your listing, ads, and promotional materials a lot easier.
- You’ll Enjoy Your Business More: If you sell something you’re not really interested in you might find it hard to really get excited about your business. This is why it’s beneficial to sell items you’re passionate about. When your business is built around products you love you’ll likely be a lot more enthusiastic. This makes it easier to work longer hours and gives you a better chance of success.
The only problem with this approach is that you have no way of knowing what kind of demand and competition a product has. You might enjoy an item, but maybe there aren’t a lot of other people who do. Or maybe the product you want to sell has a ton of competition, making it harder to make money from it.
That’s why in addition to picking items you like you should also try some of the other methods below to ensure it’s a good idea.
If you want to know what’s popular at the moment, Google Trends is one of the best places to look. This will let you see whether a product is trending and how much demand there is for it amongst consumers.
Google Trends is free and easy to use. Simply go to the website and then enter a keyword or item to research it. You’ll see what its search volume has been like over the last year, the locations where most of the searches are coming from, and related search terms and topics for you to investigate.
Search volume is scored out of 100 and based on the number of times that term was searched on Google compared to all other keywords. So, if an item’s search volume scores over 80 or 90 for a given timeframe you know it’s extremely popular.
While this is a useful tool, there are a few drawbacks:
- You Can’t Measure Competition: Google Trends will tell you how popular a product is, but you have no way of knowing how many other sellers are offering it. If too many people are selling it you’ll have a really hard time making money.
- You Can’t Measure Sales: This tool only measures searches. Just because a lot of people are searching for something doesn’t mean they’re buying it. Before you start selling an item you want to make sure it’s actually generating money.
- You Can’t Measure Profit Margins: A product may be really popular, but if the sales margins are small you won’t make a lot of money from it. This is why you need to find a way to determine how much profit you’ll receive from each individual sale.
Because of the points above, it’s a good idea to combine Google Trends with some of the other tips included in this article.
Social Media is a great place to see what’s trending amongst consumers. If something is really popular then a lot of people will be posting about it.
Start by looking through your own social media feeds. What are your friends and the people you follow talking about? Are there certain items that are being mentioned a lot?
Other places to look include the “What’s happening” and “Explore” sections on Twitter, trending videos on YouTube, BuzzFeed, and Reddit.
Like Google Trends, this will only give you any idea about what’s popular without providing you any underlying information. But it’s a great way to see what items are currently hot with buyers.
Most of these sites have a list of their best-sellers. For example, you can get new insights on the top selling products on Amazon. If you see a product on one of these lists then you know it’s generating sales and revenue.
You can also get a good idea of the level of competition by searching for an item on these marketplaces and seeing how many people are selling it. The fewer listings there are, the less competition you’ll face.
That being said, there are some issues with this system:
- Can’t See Exact Sales Numbers: Just because an item is a best seller in a particular category doesn’t necessarily mean it’s selling a lot. That category might not be very popular, so its best seller rank could be deceiving. It’s important to get an accurate measurement of a product’s monthly sales before deciding to sell it.
- Can’t Tell if Popularity is Temporary: An item may be selling well now, but will it last? Without being able to see its sales history over the last year it’s impossible to know whether its high sales are due to a temporary fad or a more long-lasting trend.
- Can’t See Sales Margins: Like other methods, this strategy doesn’t let you measure sales margins which is an important factor when deciding what to sell.
Looking at online marketplaces will give you a very good idea about what’s selling and what’s not. But if you want some more concrete information you should consider the last method on this list.
Product Research Tools
To really know what you should be selling it’s always recommended to use product research tools. These tools will give you in-depth information that will allow you to take a more scientific approach to product selection.
There are a number of tools available, such as the Amazon product finder tools offered by AMZScout. Do your research and find some tools that work well for you and your business.
Here are a few benefits to using product research tools:
- Estimated Monthly Sales: Get accurate estimates of how many sales an item generates every month.
- Competition Levels: See whether a niche is saturated or if there’s plenty of room for new sellers.
- Sales History: Look at a product’s sales over the last year to see if it’s just a fad or a consistent seller.
- Sales Margins: Estimate how much profit you’ll receive from every sale.
While the other methods mentioned here are a good way to come up with product ideas, if you want to be a serious seller you should invest in some more sophisticated tools and software.
With so many items available deciding what to sell can seem like a daunting task. But if you do your research and make informed decisions based on data you’ll be able to quickly identify products that will make you money.