It’s no surprise that the amount of sellers and customers using Amazon grows every single year.
With fulfilment centers all over the world, the leading online sales platform, and 100s of millions of users, Amazon is the place to be if you want to position your product in front of potential customers.
It even allows sole traders to launch global brands, taking care of their fulfilment, logistics and conversion optimization, allowing them to save time and focus on optimizing their listings and product research.
But the downside of this is that many of the most profitable niches will already be taken up by numerous sellers, some of whom are well established with thousands of reviews and years spent in high organic rankings.
Launching into such a niche is fighting a losing battle unless you have a large investment behind you (and/or a huge amount of time).
Despite this, demand is changing all of the time, and new trending products can arise. This means that if you know how to look out for good Amazon FBA niche ideas, you can find a product type with high demand and low competition. Launching into this with a great product and attractive listing will give you a headstart on the competition and give you a much higher chance of success.
But with thousands of sellers all across the world doing the same thing, how do you find the best niche for Amazon FBA before the big boys do?
With a little understand of the data, it’s easier than you might think.
Read on to learn more about how to find a niche for Amazon FBA success:
What does “niche products for Amazon FBA” even mean? And why do niches matter so much?
The simplest way to think of a niche is as a small, self-contained part of a certain market or demographic. A “submarket” if you will.
Most niches have even smaller niches within them, so for example the “supplement niche” also contains the “protein supplement niche” which also includes the “vegan protein niche” and so on.
In many cases, if a given category is too competitive, you can find something more specific and less competitive by simply “niching down”. This means that instead of trying to appeal to everyone within a given market, you’re targeting a very specific sector or area of it. This means it’s much easier to make a product that pleases those people, and there are much less established sellers targeting the same group as you, so in general it will be easier to catch the market’s attention turn a good profit this way.
But where do I start? How do I even know which niches to analyze?
For many first time sellers, this is the first question they’ll need to answer.
Remember, you’re looking for high demand, and low competition.
Chances are, if you just look into things that interest you, or the most obvious categories that sell well, competition is going to be really high.
Keywords like “Adidas trainers” for example are going to be already packed full of established sellers (or Adidas themselves), and you aren’t going to stand a chance of competing.
Most unaware and uneducated Amazon sellers will go straight for the category with the most sales, but you want to avoid getting swamped down with them and find gold elsewhere, in the quiet niches that few are aware of. And the only way to find those is to crunch the numbers and put in the time.
How to Find the Best Niche Products for Amazon FBA
There are a lot of different ways to find a profitable niche for Amazon FBA, but here is what you should be looking for:
- Not overly seasonal (e.g. Christmas decorations may look great if you check their demand in December but they will leave you high and dry the rest of the year! Some products may be like this without you even realising, so do your research)
- Have a high perceived value/potential for markups
- Unique or quirky products that people can’t just find in their local stores
- Light and easy to pack. This is a two edged sword because a heavy and difficult to ship product may have low competition for that reason alone. But the fact is, extra packaging and shipping weight will mean a smaller margin, and it’s always worth looking for small and light products first
- A price point that’s high enough to not be considered too cheap to be any good, but also low enough to be in impulse buy territory. Roughly $20-$100
Amazon Niches to Avoid:
- Things that are likely to break or malfunction easily (glass, complex electronics, paper decorations etc)
- Products that are highly in demand at the moment but unlikely to last in the long term
- Products that are difficult to improve on or generally all the same, like USB sticks. Especially if these already have very small markups, as it will be way too difficult to turn a good profit
Selecting Amazon Niches
There are a lot of ways to find profitable Amazon niches.
First, it may be a good idea to think of the subjects on which you’re already enthusiastic or knowledgeable – as there’s a good chance that you already have some ideas in this area.
For example, if you’re an experienced angler, maybe you have an idea for a more ergonomic rod handle that would benefit others.
However, we can’t all rely on our own interests and hobbies, so here are some tips on how to find a good Amazon product niche:
Ensure it has a Good Profit Margin
This might sound a little obvious, but it’s crucial to say – as most Amazon sellers learn this lesson the hard way with their first product.
Remember, shipping, Amazon fees, tax, and marketing all need to be taken into account.
Your margin directly influences how many units you’ll need to sell to be successful – for example, if you pay 0.10 a unit and sell for 1.50, this is a great margin, but you’re still going to need to sell huge volumes to make good money.
On the other hand, if you’re buying a unit for $10 and selling it for $35, while this is a smaller profit margin, it actually gives you more freedom to absorb costs and allows you to make a decent profit with less sales.
Keep the Dimensions and Weight in Mind
Selling a product that is very large or heavy will simply add to your list of problems. Shipping will be more expensive (which may also turn customers off), damages will be more common, and your shipments from your manufacturer will likely have less units.
Products that are small and light are much easier to deal with logistically and much cheaper to replace.
However, this doesn’t necessarily mean you should go for this type of product. Most sellers will prioritise this, meaning in some niches you may find much less competition by going for the heavier, larger products.
Either way, it must be part of your planning and is a dangerous thing to overlook.
Be 100% Sure the Demand is There
This is actually quite an easy one to overlook, as it’s easy to assume that if you sell a good quality product at a good price, that sales are guaranteed, but if nobody is looking for this type of product, you’re doomed to fail no matter how good your offering is.
We would recommend using an Amazon product research tool such as Helium10 to check the sales being achieved by existing sellers of similar products.
Aim for 150+ sales per month, as any product that is achieving less than this exists in a small market that you aren’t going to get a decent slice of.