Targeted advertising campaigns, selling a diverse range of products and never running out of stock are some of the strategies used by Kwame Miller to achieve more than $4.7 million in sales in just six months on online giant Amazon.
But the local Amazon success story requires hard work staying abreast with the constant changes on the platform while ensuring that customers are satisfied.
Miller, who made his first sale on Amazon in January 2020, recorded a steady increase in sales, ending the year with US$1,663 in sales on the last day.
He sells a number of locally manufactured products.
The Amazon seller generated US$31,500 (about J$4.75 million) in the last six months while moving his product offering from two to more than 60.
Miller said never running out of stock was vital to his success.
“If you have one killer product, that’s fantastic. But what if that one product doesn’t do well, then your entire revenue is wiped out”, Miller told an audience of prospective Amazon sellers.
Miller was addressing the launch of Project Amazon, an eight-week training course for 20 micro, small and medium-sized businesses (MSMEs) selected by the Jamaica Manufacturers and Exporters Association in Kingston on Wednesday.
“Your inventory must never run out; if you are selling something that people want, and you stop selling it because you’re out of stock, they’re going to look on the shelves and see something that may not be as good but is available, and they’re going to buy that product”, he explained.
Sales also affect how sellers are ranked by Amazon, so a slow-down in business pushes you down in the search order.
“Once you buy something on Amazon the easiest thing to click on is “order again”, so (your former customer) becomes your competitor’s customer for life, and you never want that to happen”, Miller said.
“If you’re out of stock Amazon says, ‘hey this guy is not making any sales and is not making any money for us’ … If you are not making sales then you are not (Amazon’s) priority; someone else becomes their priority”.
He said two items could be combined into several products, for example a two-pack or three-pack to diversify the offerings to customers.
Miller noted that it might be prudent to use an expensive method of shipping your stock to remain in business.
“If you’re running low on an item and you don’t want to go out of stock to drop your ranking, it makes sense to use a more expensive shipment to keep up your stocks. You’ll make it back in the long run”, he said.
He advised the sellers to ship in advance so that their stocks reached Amazon in a timely manner. Continuous monitoring of prices and the seasons for certain products is also key.
“If you are selling something in America which is pumpkin-based, you know in October that you’re going to make a lot of sales…For barbecue sauces, the barbecue season is from June to August. You have to ship your stuff before that season comes along”.
With over 190 million people and over 350 million products on Amazon, it’s hard to get noticed.
But with “carefully designed advertising campaigns” Miller made significant sales, with total revenue of $4.70 for every dollar spent on advertising.