Explore the successful path of private label sellers to earn tens of millions per year

The 996 work model has caused a sensation online recently, with many office workers complaining about their work lives. Five years ago, Greg Mercer was one of them. After graduation, he worked as a civil engineer and struggled in his nine-to-five work life. In order to escape this cramped situation, he started to open a store on Amazon and sell his own brand.

Today, his store has more than 40 SKUs and annual revenue exceeds eight figures. Let's take a look at how Greg Mercer did it...

First of all, what is private label?

The private label model is an e-commerce sales model in which one company owns the brand and is responsible for selling the product, but the product manufacturing is handed over to another company.

These are the own brands:

• Walmart's Great Value Brand

• Mainstays at Target

• Amazon Essentials by Amazon

In addition to physical objects, intangible assets or services such as freelance jobs, web domain names, and insurance products can also be private label products.

If you’re interested in opening your own online store, selling your own branded products using the Amazon FBA service is the best option.

Steps to finding the right private label product to sell:

Inspiration can happen anywhere.

How does Greg Mercer select products?

• When you go shopping or visit a mall, keep an eye out for hot new products

These products are usually newer products that Walmart and Target don’t have in stock yet.

Once he gets home, he enters the products into a product research tool to determine if they are worth selling.

• Amazon.com

Find new products by digging deeper into products within each section and subcategory, paying special attention to the Hot New Releases column; and check out other sellers’ stores and product listings to see what they are selling.

• Browse social media for product ideas

There are always some bold and innovative product ideas popular on social media, and there are many outstanding creators on Kickstarter and IndieGoGo who are using new ways to promote products.

So what kind of private label products should you sell?

It is recommended that new sellers purchase the following products:

• Small and lightweight. Your product should fit into a small box and weigh between 1-2 pounds.

• Non-seasonal . New sellers are advised not to buy seasonal products. Seasonal products include: Christmas lights, Valentine's Day gifts, winter clothing, etc.

• Products that are not restricted by Amazon's rules and are easy to produce and sell. Products such as food, toys, and batteries have some tricky rules, and selling these products may become difficult.

• Simple but not complicated. When making electronic products, you will often encounter various technical and customer service issues. Making fashion products is not simple either, as one SKU must provide multiple colors and sizes.

Before you find a good private label product, you need to do a product selection analysis to determine whether the product is worth selling.

Product selection analysis steps

• Purchase and download the Jungle Scout Chrome extension.

• Enter your product keywords in the Amazon search box. When the search results page appears, click on the right side of the browser address bar to open the Jungle Scout Chrome extension.

• Verify the product's data. The Chrome extension will show the product's average monthly sales, average rating, and more.

So, you must be wondering which products you should research?

Greg Mercer recommends looking at products that average 250-400 SKU sales per month. Also, you don’t want to be too competitive, so it’s best to look for products that average 100 or fewer reviews.

The next step is to find product suppliers and manufacturers.

You can find it on Alibaba, where sellers can buy wholesale or bulk products directly from overseas manufacturers.

Alibaba is not only convenient and practical, but also very safe, and all suppliers are strictly controlled.

Basic steps to find potential suppliers on Alibaba:

• Create a buyer account on Alibaba.com ;

• Enter your product keywords in the search box. Alibaba's product database is similar to Amazon's.

• Find product listings similar to your product selection.

Send a message to the product supplier/manufacturer to learn more about the product. Usually you need to ask the following questions:

• Product unit price/whether more purchases will get more discounts

• Minimum Order Quantity

• Can product samples be shipped to your home?

• Payment methods that the other party can accept

• What you can customize

It is best to shop around and order a product sample from each of 3-5 suppliers to compare the results.

The following are sample inquiries:

• What is the price per unit for this product when I order 500 units (or however many units need to be ordered)?

• Can I have a sample shipped to my location? If so, what's the cost?

• What payment terms and methods do you accept?

• How can I customize this product?

Private label sellers can put their own logo on the packaging and the product itself.

If you are new to design, you can hire a professional designer to help you design a logo. It is best if your design is unique so that it can stand out more easily.

In addition, you don’t need to be a professional to customize your products. Customizing products is actually very simple, and sometimes you only need to change the color of the product.

Provide quality packaging whenever possible. Thoughtful packaging of your product can improve the customer experience.

Additionally, you can add your brand’s website, useful information, etc. to your packaging.

The above are just the necessary conditions for opening a store.

You also need to get the products to your customers, which requires you to choose a logistics delivery service.

Some people choose to ship the goods themselves, while others use a third party to fulfill the order.

It is recommended that private label sellers choose the FBA logistics service provided by Amazon.

Not only can you get 2.5 billion Amazon consumers visiting every month, but Amazon can also ship and handle the goods for you. All you have to do is hand over the inventory to Amazon.

At this step, you need to carefully choose the manufacturer you are going to work with.

You can compare the speed of sample delivery from each manufacturer, the condition of the samples when they arrive, and the manufacturer's communication during logistics and transportation to determine the manufacturer you will finally cooperate with. These factors are often more important than product cost.

Note: Try not to work with manufacturers with the lowest product costs. Although private label sellers all hope for lower costs, the lowest cost is not necessarily the best option.

It is recommended that sellers choose manufacturers with better customer service and faster delivery, and the product price can be negotiated.

After you have chosen a supplier, you need to arrange payment. Most suppliers accept payment via PayPal or Ali Credit Guarantee Service.

It takes about 3-4 weeks for manufacturers to produce products, and another 1-2 weeks to ship to sellers or the nearest Amazon logistics center. These 4-6 weeks are the best time for sellers to create product listings.

Before creating your product listing, make sure you have completed the above steps.

Steps to create a product listing:

• Make sure to upload high-quality product photos. Unless you are a professional photographer, it is recommended to outsource. If you can't find a photographer yourself, you can go to Jungle Market , where there are many freelance photographers.

• Create a product listing title

  The title is one of the most important components of an Amazon private label product listing. It is included in Amazon’s index and has a significant impact on product ranking. Therefore, make sure the keywords you use in the title are the most relevant to your product. For example, if you are selling copper measuring cups, to improve the ranking of this keyword, make sure the keyword copper measuring cups appears at the very beginning of the title. Next, enter the second and third most relevant keywords.

• Add the most prominent features and benefits of your product in your product description and bullet points. This way, customers are more likely to make a purchase decision when they click on your page.

The more your product meets a consumer need, the more likely they are to buy it.

After setting up your product listing, it is recommended to run Amazon on-site advertising - PPC advertising, which is the best way to attract consumers' attention to your private label products.

You can bid on Sponsored Ads, which can make your products appear on the first page of search results, in remarketing ads outside of Amazon, and even on competitor product pages.

Through the reports in Amazon Seller Central, you can find keywords that convert effectively to help you determine the keywords to bid on in your PPC ads.

Additionally, you can use Jungle Scout’s keyword research tool to see what keywords your competitors are using.

If you are familiar with the Amazon PPC and sales process, you can use other tools to A/B test the effectiveness of multiple elements in your product listing to see which keywords are effective. It is best to change only one variable each time you perform an A/B test.

You can use software like Splitly to help you understand keyword effectiveness.

At first, your ads may not convert as well as you thought, but after a few weeks of adjusting your keywords and bids, your sales could double or even triple.

How to effectively price products on Amazon?

Most novice sellers take it for granted that the lower the product price, the better. In fact, this is a very wrong idea.

Greg Mercer rarely adopts the strategy of pricing products lower than competitors, but instead uses other means to leave competitors far behind.

According to Godin's marketing theory in Purple Cow : create a different and unique product and find the right target group. Therefore, he:

• Design product models and packaging products more carefully

• Use more rigorous marketing language in product listings

• Provide good after-sales customer service

However, as a rule of thumb, you should still keep your product pricing within 20% of your competitors’. For example, if the market price of a product is around $25, your product price should be between $20-30.

In addition, private label sellers should try to sell products priced between $20 and $50 on Amazon.

If the product is priced below $20, there is almost no profit after deducting product costs and advertising expenses; but if it is over $50, the conversion rate of the product is not high, and you will be scolded if you receive bad reviews. Who told you to sell more expensively than others and your products are not as good as others?

Here are some examples of pricing private label products using the above ideas and methods.

You can see the metrics for various products in the graph, which is a feature of the Jungle Scout Chrome extension Pro.

Of course, examples can only be other people's examples. The market may change at any time, so you must do your own research.

Example:

1

Homeschool Planner

3

Copper Measuring Cup