This number is huge. I agree.
The first thing I wonder is where do they come from ?
According to the data we got from local medias like journaldunet or frenchweb, China is going way ahead. And it is not a big surprise.
In china, there are millions of entrepreneurs, factories and traders who have been converted to e-commerce thanks to Alibaba. Same in B2B, many companies have migrated to B2C. And gradually they have moved to Amazon or add amazon as their preferred Channel. It is a country of entrepreneurs with unlimited manpower, producing products for the consumers of the whole world.
More than a trend, it is the reality.
We have met 100 amazon sellers over the last 18 months and what we have learned from them is very helpful:
- They mostly started to sell some branded items that they were buying from the local market. Then with the lower profit, they moved to unbranded products with higher margin. Combining marketing tools with a high value product, they succeed to reach some high numbers
- The most successful way is to use local warehouses to sell quickly and optimize the buying experience
- After 2 years of very profitable business, profit started to highly decrease 1 year ago. And it went down to nearly no profit.
What can we learn from those conclusions:
- The lifetime value of the product is limited. And you must be innovative in order to keep your sales running and increasing.
- You don’t need “a lot of basic products”, but you need “few basic products with distinctive difference”.
- The way to increase your profit margin is to diversify your selling channels: There are more than 100 marketplaces waiting for new sellers to sell some new products
Rakuten, Cdiscount, Darty in France, Eprice in Italy, Carrefour in Spain, Catch in Australia, Newegg in USA, there are so many unexplored channels that could help you to diversify your business and increase your profit.
Check “Marketplace” from our home page to learn more about it.