Prime Day saw thousands of orders a day, and a profit loss of NT$100,000

But behind the glamorous appearance of Prime Day, can third-party sellers really make money by participating in promotions? Today I’d like to share with you a story from one of our fans: a story in which others see me as having a huge order volume, but no one knows that I’m losing money…

Let me first tell you how I got into this industry. I went to college in Hangzhou. Since my major was e-commerce, I fit in with the e-commerce atmosphere in Hangzhou, so I chose to stay in Hangzhou after graduation.

The first company I worked for was mainly engaged in eBay business. There were only three people in the Amazon department including me. The other two bosses didn’t pay much attention to me as a newcomer. The boss also gave me a store with monthly sales of about 3,000 US dollars and nothing happened afterwards.

So I figured things out on my own by browsing forums, and sometimes I would shamelessly invite the two big guys to dinner. In the end , I managed to set up my own store after some bumps and turns. After more than half a year, I could make eight or nine thousand dollars in sales, and even tens of thousands of dollars during the peak season.

However, my boss was unwilling to continue investing in Amazon, and the costs of evaluation and advertising were very tight. I felt that my talent was not appreciated, and I felt very depressed at work every day, so I changed companies with this result.

Although the second company paid well and the boss was willing to invest (this is very important), the store was doing well. But one day, I suddenly had an epiphany. I felt that working was still working for others, and I would always get a small share of the profits.

My family helped me with some money at that time, so I quit my job and started working on my own. I chose a kitchen product that was not expensive, and the product was not big, but not many people made it. I didn’t go into details about the bumps and bruises along the way, but I managed to survive and not leave.

Let me talk about our category. It was doing OK when I entered the market. However, at the end of the year when I went out to work on my own, several big sellers suddenly came in with capital. Now the prices of the entire category have been pulled very low by these big sellers.

Sales have been stagnant for a long time in the first half of this year, and there has been no significant increase in rankings and traffic. So I plan to make a bigger effort on Prime Day. It doesn’t matter if there is a small loss. I will just treat it as an investment to increase rankings and traffic.

Now I think back, I was really naive back then, and Amazon’s rules taught me a lesson.

For Primeday, I paid LD for several main products, and also offered exclusive discounts for new products and products with little sales. The discounts were quite large, and in the end I lost about $2 on each item.

I estimated based on my daily sales and the sales of my competitors, and it would cost me about 30,000 to 40,000 yuan to get my ranking in the top ten. After getting a high ranking and high traffic, I could quickly make it back with the profit from normal orders.

Unexpectedly, the results on Prime Day exceeded my expectations, and we achieved sales close to a normal month’s level in just one day.

In fact, it is not a big hit. Compared with the 3,000 orders in ten minutes reported online, it is still a drop in the bucket. But for a small seller like me, it is still an unprecedented experience.

During that time, I stared at my order page like a possessed person, refreshing it and grinning foolishly. Every time I refreshed it, there would be a dozen more orders. That feeling was truly unforgettable.

The same thing happened with the LD on the second day. The orders I placed in these two days were enough to cover more than a month's normal sales. Of course, I also knew very well that I was selling at a loss. I calculated that the loss might be around 80,000.

Although it hurt, I knew that I had been planning to spend money to buy rankings. The surge in orders this time had a very obvious impact on the rankings, and I was almost in the top three in the subcategory. Everything seemed to be going exactly according to my plan, until the next two days, which completely changed my view of the big promotion.

In the next two days, I experienced a double plunge in traffic and rankings, and no matter how high my ad bid was, I couldn’t stop this trend.

Matching the decline was a clear decrease in orders. Because of the previous losses, I could no longer offer promotional discounts at this stage. Small sellers really couldn’t afford it and could only watch their products getting worse day by day, and finally maintained a ranking slightly better than before.

Including the advertising and other miscellaneous expenses, the nearly 100,000 yuan I invested during Prime Day was almost wasted. The rankings that were raised by low prices and discounts are simply unsustainable. Once there are no activities and discounts, Amazon will immediately return your product to its original state.

If I had gotten support from my family to buy a house in Hangzhou many years ago, this story might have been different. I really don’t know how long it will take me to recover from this.

Selling at low prices, even at a loss, and then raising prices to make money. I think this is the route many sellers are taking. The fierce competition in domestic e-commerce makes it difficult for sellers who do not take the low-price route to survive.

But Amazon is different. Its boutique and brand lines are doomed to be incompatible with low-price sales. Once the seller raises the price, it is easy to lose the shopping cart and the ranking will plummet.

Running sales at a loss is like working for Amazon!

This is a lesson learned from the hard-earned money of countless sellers. Never do anything like losing money in exchange for rankings! Ensuring your own profit margin is the first priority! Finally, I have prepared a high-profit operation skills package for everyone. Scan the code to find me to receive it~

PS. If you want to join the seller discussion group, you can also privately chat with me and ask me to add you to the group. At the same time, everyone is welcome to share their Amazon stories with us.

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