Amazon Product Development Methodology and Practical Guide

In the fierce competition on Amazon, product development is one of the key links for sellers to succeed. This article will introduce you to the methods and practical steps of Amazon product development in detail, helping you stand out in product selection and operation.

1. Two key factors before product development

1. Amazon’s internal factors

• Competitive product analysis : Pay attention to the number of competing products, ratings, prices, number of reviews, the ratio of US and Chinese sellers, rankings, advertising costs, and traffic sources.

• Product life cycle : Analyze the product life cycle to determine whether it is in the rising or declining stage.

• Competition level : Assess the level of competition in the category and choose a market segment with less competition.

• Chance of Success : Based on the above factors, determine the product’s chance of success in the market.

2. Corporate strategy factors

• Profit margin : Make sure there is enough profit margin on the product.

• Business model : Clarify the product's price positioning and market positioning to maximize profits.

• Supply Chain Management : Evaluate supplier quality, billing cycles, turnover rates, and overhead costs.

• Opportunity cost : Weigh the opportunity costs of different products and choose the optimal solution.

2. Product Development Process

1. Market demand discovery
Based on market trends, look for potential market segments.

2. Product Discovery
Discover specific products through in-site rankings, hot-selling product peripherals, and boutique store monitoring.

3. Preliminary profit calculation
Calculate the product's cost, selling price, and profit margin to ensure the product has profit potential.

4. Category/keyword analysis
Analyze the competition level of the target category and the search trends of keywords.

5. Negative review analysis
Study negative reviews of your competitors to find opportunities for product improvement.

6. Copyright and patent search
Ensure that there is no risk of product infringement.

7. Find the supply chain
Find reliable suppliers to ensure product quality and supply stability.

8. Product finalization
Determine the final design and functionality of the product.

9. Profit review
Recalculate the product's profits to ensure that the product is competitive in the market.

3. Amazon Product Development Method

1. Amazon site development

(1) Amazon in-site ranking method
Pay attention to products with less than 100 reviews in the BSR list of subcategories, especially the top 10 products in the New Release list. These products are usually new products that have been launched recently and have high weights, which are suitable for copying or fine-tuning.

(2) Peripheral products of hot-selling products
Choose peripheral products of hot-selling products to avoid direct competition and at the same time take advantage of category traffic. For example, the scoreboard and card holder of dominoes are both successful examples of avoiding competition.

(3) Product selection method for store monitoring
Regularly monitor stores with 30-300 products and 15-100 feedbacks, and study their new product launches and order status.

(4) Multi-pack combination method
Choose trending products and improve the price/performance ratio by combining multiple packs. Pay attention to card size and weight to optimize commissions and delivery fees.

(5) Follow-up of your best-selling products
Starting from your own best-selling products, develop peripheral accessories or related products to form a product line.

2. Off-Amazon Development

(1) Social media observation
Follow micro-influencers on platforms like Instagram and TikTok for product inspiration.

(2) Supplier accumulation
Accumulate reliable supplier resources to ensure that new products can be launched quickly.

(3) Cross-platform product selection
Refer to popular products on other e-commerce platforms to find potential opportunities.

(4) Product selection based on big data
Use tools such as SellerSprite to filter products by market trends, chart potential, seasonality, etc.

4. Analysis after product development

1. Category Analysis

• Proportion of new products : Analyze the listing of new products in the category and determine the speed of market iteration.

• Product/Brand/Seller Concentration : Determine whether the market is monopolized by a few products or sellers.

• Industry demand and trends : Analyze market seasons and trends to provide a basis for product development.

2. Table analysis records

• Product Trends : Analyze product trends over the past two years to determine seasonality and year-round sales.

• Competitive product comparison : Compare the functions, packaging, size and price of similar products to find advantages and opportunities.

• Product finalization : Determine the final design of the product based on market demand and core attributes.

• Profits and pricing : Calculate FBA fulfillment fees and profit margins to ensure your products are profitable.

5. Copyright and Patent Search

(1) WIPO
Search patents by keywords, focusing on the validity and design purpose of the patent.

(2) Google Patents
Assist in searching patents to confirm whether the product has infringement risks.

(3) USPTO
Search U.S. patents by keywords and view patent details.

(4) Google Image Search
Assist in determining whether a product has copyright risks.

(5) Products restricted or banned by Amazon
Check Amazon’s official list of restricted or banned products to avoid violations.

6. Applicable team types

1. New sellers/expert sellers
It is recommended to come from the market, go to the market, and quickly trial and error through imitation and micro-innovation.

2. Factory-transformed sellers
Leverage the factory's advantages, redesign products, and deepen the supply chain.

3. Boutique/vertical category sellers
Continue to deepen products and supply chain, and constantly update and iterate.

4. Holiday/Seasonal Product Sellers
Adopt the precise distribution method, share the risk among multiple SKUs and multiple stores, and control the time nodes.

7. Product development thinking direction

1. Continuous innovation : All products have a life cycle, and continuous development of new products is the key to maintaining competitiveness.

2. Demand research : Researching market demand is more important than analyzing data.

3. Rapid trial and error : New sellers should conduct rapid batch trial and error to accumulate experience.

4. Seize the initiative : The two routes of product development are to meet demand and to seize the initiative.

5. Avoid common failure factors : such as low market capacity, fierce competition, infringement, etc.