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Lunch and Learn: How to grow your sales by selling on Amazon


Posted: Thu 27th Aug 2020

On today's Lunch and Learn, IQualTech CEO Zamir Cajee joined Enterprise Nation founder Emma Jones to talk about how to successfully sell on Amazon.

IQualTech is a consumer electronics brand that specialises in everyday essential items. Zamir ships IQualTech's products all over the world and provided some great insights on selling internationally, market research and making the most of Amazon's tools.

Why did you choose Amazon as a channel?

For Zamir, one of the biggest benefits of Amazon is that it positions third-party products alongside its own. It puts you on a level playing field because the differences aren't obvious.

Amazon also gives Zamir the opportunity to focus on his areas of expertise, without getting bogged down in the logistics.

"I can focus on the brand and product quality and not have to worry about the staff and warehouse and logistics. Amazon handles that and they're world leaders in it," he said.

View IQualTech's Amazon store.

Can you do market research on Amazon?

Zamir is constantly looking for new opportunities, so he does a lot of research. He uses the data available on Amazon and Google to explore new markets and see whether he could compete.

He recommends looking at demand and how it's being met. There's no point going for a high demand market where there are lots of competing companies and the products are good quality.

Look for markets that are lacking; maybe the products aren't satisfying customers or there are only a handful of businesses selling in the area.

"Amazon reviews are great for doing quality analysis in a market. Customers will tell you exactly what they think of a product and where the issues are. If you can resolve those issues and there's a margin, you can think about it," Zamir said.

He adds the caveat that it's tough to make decisions based on data at the moment. You can't look at last year's seasonality and apply it to this year, because Covid-19 has made consumer buying habits less predictable.

"When you don't have data, it's down to gut feeling. You can go back to the last few years and look at social media and see what bloggers are talking about. Identify what type of products people are looking for, whether it's something niche or something that serves a big market."

Have you identified new markets as a result of Covid-19?

Zamir has made a couple of changes to what and how he sells as a result of the crisis.

He's grouped together products like notepads into a "home working" package. With stationery shops closed, he saw a huge spike in demand during April and May. He's also collaborated with other businesses on things like sneeze guards, which are clear panels that divide up desks in offices.

One area he's particularly enthusiastic about is cycling, with fewer people opting to take public transport as a result of Covid-19.

Zamir explained what his process would be for targeting a new market:

  1. Identify which area you're going to focus on. For example, it might be products for triathletes or for casual cyclists.

  2. Understand where the products are going to be manufactured and the economics of getting them produced.

  3. Look at the retail cost and margin.

  4. Find a manufacturer that could produce high-quality products at the right price point.

  5. Put the idea into a group of potential products. Then, whittle down the products until you choose the ones you want to move forward with.

How do you connect with customers so they keep coming back?

Zamir recommends paying attention to your packaging. Even though it will arrive inside an Amazon parcel, the packaging can still carry your brand.

He also tries to make sure customers are happy with orders. You can't market directly to customers but you can interact with reviews. Zamir aims to respond to customers as quickly as possible and "outdo Amazon when it comes to customer obsession".

How complicated is it to ship to new territories?

Moving products across Europe has been easy so far. Zamir can send items to a UK fulfilment centre and Amazon will move it on, although it will become more complicated when the UK leaves the European Union.

Shipping to other countries poses more challenges, so Zamir recommends focusing on territories with large markets.

"You learn a lot when you're shipping to other countries. The US was a challenge, but it's a big enough market. Same with India. Then we hit Japan and that got really challenging - the customs declaration is really complex.

"We started to slow down at that point. I realised I was starting to spread myself a little bit too thin and do too many things with too many countries. For us, I want to make sure we're maximising sales in Europe and the US first. India is the next step, then we'll look at Australia and UAE."

Do you sell direct to consumers through your own website?

Zamir also sells through his website, driving traffic there through Google and social media. However, he gets a better margin on Amazon sales because Fulfilment by Amazon costs less than Royal Mail.

"We have to pay higher fees when we're shipping to customers from our website. In terms of the commission Amazon charges, it's fairly similar to our acquisition costs through Google," he said.

Would you let an agency manage your Amazon account?

Whether you let an agency manage your Amazon account depends on the split of revenue. Zamir prefers to take a hands-on approach with his account.

"I've literally been a flex driver for Amazon and delivered parcels to customers, so I could understand how the process worked. I know the difference in packaging for parcels that get put through the letterbox and parcels that get left on the doorstep.

"It's really important to understand intimately how every single part of your business works, particularly if it's a part of your business that's generating a significant proportion of your revenue," he said.

Take part in a free Amazon bootcamp

During our five-day bootcamp for home, leisure, gadgets and gifts businesses, 100 businesses will benefit from sessions on pricing, marketing tools, brand building and more.

The deadline for applications is 6 September. Click here to apply for the bootcamp.

 
 
Kat is a writer for Enterprise Nation, The Pitch and Side Hustle Club. She's worked with small businesses for the last four years, championing Britain's startup scene and anyone who has snacks. 
 

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