Become an Amazon seller: 3 strategies for long-term success
Amazon is the largest digital marketplace in the world. 51% of online shoppers do not start their shopping on Google or an online store, but directly in the search bar of a shipping retailer – in most cases, this means Amazon. Almost every German either has their own Amazon account or at least access to one, for example, through a partner or family. This huge customer base leads to high competitive pressure among third-party sellers on the platform, but it also presents a significant opportunity to start and successfully build one’s own business. It is no wonder that thousands want to become Amazon sellers every year.
With this article, we aim to not only simplify your first steps on the platform but also provide you with some strategies to lay the foundation for your long-term success.
Basics: Business, seller account, and more.
To become a professional Amazon seller, you first need a registered business and a seller account. While it is also possible to sell privately on Amazon, anyone seriously interested in starting in online retail will have to register a business. Fortunately, this is not rocket science and is usually completed within a few minutes. Most trade offices also offer corresponding online tools. In terms of legal form, most choose the sole proprietorship or the civil law partnership (GbR).
Next, you need to fill out the so-called tax registration questionnaire so that the tax office can classify your project accordingly – this can also be done online via ELSTER. This way, you will also receive your tax number and VAT identification number.
In addition, you should set up a business account. While this is not mandatory for sole proprietors, it helps with proper accounting and the necessary tax-related separation of private and business payments.
Setting up an Amazon seller account
Below you will find a detailed guide on how to set up your own Amazon seller account.
Apply for EORI and EAN numbers
By now, you should also take care of two more important applications: the EORI and EAN numbers.
Other aspects that beginners should consider:
Become an Amazon seller: Costs
Both the seller account and selling products through the marketplace are not free. The exact amount cannot be predicted, as many different aspects play a role. A professional seller account costs a flat rate of 39 euros per month. In addition, there is a sales commission that is charged per sold item and is between 8% and 15% in most product categories. The exact amount can be viewed here: Sales commission by category.
Additional costs may arise if you use services offered by the Amazon seller platform, such as Fulfillment by Amazon (FBA). Long-term storage fees, listing large quantities of offers, or advertising measures through Amazon Advertising will also be charged separately.
Long-term success: Pricing strategies for professional sellers
Becoming an Amazon seller also means having a high standard of quality, as only if you manage the metrics of your seller account will the algorithm evaluate your listings as good enough to award them the Buy Box or a top position in the search results. You can learn more about this here: The key KPIs for anyone who wants to become an Amazon seller. However, an important and often decisive factor is the price of the product.
Therefore, calculation and pricing are immensely important to achieve long-term success on Amazon and to build a financially healthy business. It does not matter whether you sell commercial goods or private label products.
Good to know: Product types on Amazon
Amazon fundamentally distinguishes between two different types of products: commercial goods (also known as “wholesale”) and private label products. The former typically consists of well-known branded products that are brought to market by third parties. This could be, for example, a electric shaver from Braun, which is not (only) sold by the actual brand owner, Braun, but also by other third-party sellers who have the appropriate sales license. All sellers of the same product compete for the Buy Box, the yellow “Add to Cart” button on the product page. Usually, only one of the offers wins the Buy Box and captures all sales that come through the cart field during that period. This accounts for about 90% of all sales.
Private label products, on the other hand, are so-called own brands, offered exclusively by one seller. Since there is only one seller, this seller usually automatically wins the Buy Box. However, this does not mean that there is no competition. This competition takes place at a higher level – in the search results. For private label products, it is particularly important to achieve a top position here to ensure maximum visibility to the searching customer.
For both commercial goods and private label products, the algorithm is influenced by many different factors, such as seller ratings and conversion rates. However, price is of central importance, both for winning the Buy Box and for ranking on the search results page. Without appropriate price optimization, you have no chance on Amazon. Therefore, we will provide you with three pricing strategies that will help you win the Buy Box and improve product visibility.
Buy Box Strategy
This is likely the most important strategy for many who want to become Amazon sellers and are just starting on the platform. The vast majority will initially have wholesale products in their assortment, as private label products involve much greater effort and risk. However, winning and maintaining the Buy Box requires continuous market monitoring and price optimization.
Goal: Winning and maintaining the Buy Box
Approach:
Always keep in mind that price is not the only factor in winning the Buy Box. To remain competitive, you must meet high performance standards as a seller. This includes fast delivery times, a low error rate in orders, and excellent customer feedback.
Push Strategy
This price optimization is quite simple, but challenging to execute. You adjust your product prices based on sales figures to either boost your revenue or increase visibility. This is done through a price increase or a price decrease, depending on sales volume and goals.
This way, you can maintain an optimal balance between profitability and competitiveness while ensuring visibility on the platform. Since you need to be mindful of money at the beginning of your self-employment, the push strategy is excellent, as it allows you to make better use of the budget available to you.
Goal: Budget control
Approach: Lower the price after certain sales thresholds. For example, offer a discount of €0.10 after 10 units sold and an additional €0.50 after 20 units sold. This way, you strategically implement price reductions and maximize their impact.
Goal: Increase sales during a product launch
Approach: Since this is a new listing on Amazon, visibility and sales are correspondingly low. Start with a relatively low selling price and gradually increase it as sales increase – for example, by €0.10 after five sales and by €0.50 after ten sales. After another 20 sales, increase the price by 5% each time until you reach your desired price. This way, you can gradually improve both margin and ranking.
Cross-Product Strategy
Even if private label sellers do not have to compete for the Buy Box, they are still exposed to significant competition on the search results page, where many similar products vie for the customer’s attention. A top position is crucial for the success of a product. Pricing is also essential here – both for ranking and for the customer’s purchasing decision. Through cross-product price optimization, you can align your prices with the competition and maintain your competitiveness.
Goal: Increase visibility
Approach:
Manual vs. automated approach
For all these strategies, one thing applies: You must repeat the price adjustments almost continuously, as your competitors are doing the same. Even for small assortments, this will quickly overwhelm you – and rob you of all the time for the further development of your business.
The automated approach with a professional tool like the SELLERLOGIC Repricer for Amazon has many advantages for you.
Conclusion: Become a successful Amazon seller
Starting as an Amazon seller offers enormous potential but comes with challenges. The competition is fierce, and pricing plays a central role in the competition. Those who want to be successful in the long term should rely on well-thought-out strategies and continuously monitor the market.
Approaches such as the Buy Box strategy, the Push strategy, or the cross-product pricing strategy help to optimally position oneself in the marketplace. While the Buy Box strategy is particularly important for retail goods, the Push strategy allows for targeted price increases to maximize revenue and visibility. The cross-product pricing strategy especially helps private label sellers to assert themselves in the competition and build a strong market presence.
A purely manual pricing strategy can be inefficient in the long run. Automated solutions offer a resource-saving alternative by responding to market changes in real-time, thereby optimizing revenue and profit. An AI-driven repricer can help to compete against the competition without the need for manual adjustments.
Anyone who wants to become an Amazon seller and achieve sustainable success should not only master the basics but also utilize smart pricing strategies and automation tools. This not only secures a competitive advantage but also ensures long-term business success on the world’s largest trading platform.
Frequently Asked Questions
To sell products on Amazon, you need a registered business, an Amazon seller account, a tax number, and possibly a VAT identification number.
This varies greatly – from a few hundred euros to six-figure monthly revenues, depending on the product, strategy, and competition.
The professional plan costs €39 per month, while the individual seller plan is free but charges a fee of €0.99 per sold item.
Amazon charges a sales commission depending on the product category, which is between 8 and 15% in most categories.
The main advantages are the large reach, high customer trust, premium shipping (FBA), easy scalability, and access to Amazon’s advertising and analytics tools.
You must, for example, research products, search for suppliers, carry out brand registration (optional), create a listing, organize shipping to Amazon’s warehouse, and take care of marketing.
You can sell almost all physical products on Amazon, except for prohibited or restricted items such as weapons, drugs, or counterfeit branded products.
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