Product tool Salespickr prevents blunders like Fidgetspinners
What a great feeling it must be when you start working on a new product on Amazon or Bol, and you wake up the following day with more than ten sales confirmations of success. From page 15 to page 1, the first reviews come in. This was a great idea, and you were right on top. It boosts your self-confidence, and your turnover is no longer a lie.
That's how it feels when you sell successfully with e-commerce. Unfortunately, this feeling is not always true. 15% of Amazon sellers are not profitable, and Bol sees a decline in its partner performances during this challenging economic downturn. But how do you make the right decision to buy and sell a few good products via e-commerce quickly?
Not all stories are success stories
A little manual research and perseverance will often do the trick. Still, not every investment will be successful if you have not considered all the variables. Not just the revenue and number of sales but also the cost of purchasing, taxes and advertising. Also, consider return costs and the emergence of competition. You only want to sell in your niche. Then it would help if you avoided that your product ends up in a database that your competitors can also see, as many Bol.com tools allow.
One of the products that were fast hijacked was the fidget spinner. After a long search, we finally found a top product that was nicely hyped and had a good market position. Simplistic, easy to buy, small and light for a low shipping price and excellent profit margins. But because this product ended up in a database where multiple parties could see how the product performed, the profitability was quickly expressed in the market.
The product was difficult to differentiate into, and there were hardly any complementary products to sell with the fidget spinner. Then you end up with a product with high competition, low barriers to entry and where money is made, hijackers are on the coast. The consequence was that products, within a short time, grew into a hype in which the price became drastically lower almost by the day. So, if you had just purchased a container of fidget spinners, the margins became very thin given the long delivery time and declining profitability.
Now you might think, but how would I know? On the one hand, you could use the shopping cart method, which you use to determine turnover by the sales that a product makes. On the other hand, you could also keep track of competitor prices and the number of competitors. For this, you either need to open an excel table and update it manually every day, or you can build a simple Python script and let a scraper do it automatically. Not too complicated, but a lot more convenient.
How can you prevent investing in the wrong products?
You can prevent a failure like this if you see that the competition is proliferating or if more listings are added quickly on Amazon, Bol or Google. You can also see it reflected in the price. Applying the law of supply and demand, you can reason out profitability: more supply means less scarcity and lower costs, so less profit.
There are also automated tools that look at a product's competition and profitability or the performance of price and sales over time. So as e-commerce, you don't have to learn coding language and keep excel tables. Moreover, it is easier to do this for dozens of products simultaneously. This is just a little bit faster, and you also have a better chance of finding an absolute best seller if you have more data and products at your disposal.
Finally, one more reason why the fidget spinner is such a good example. The people in the Netherlands who made a good living out of fidget spinners looked further than the back of their noses. The Netherlands is not a trendsetter but a follower of trends from America and Asia. If you want to be ahead of the competition, you will have to look beyond the borders and not in the same small pond as 50,000 other Bol sellers on Bol.com, for example. Beyond the borders is where you want to grow your business, but also where you can find your data for more profit.