I know a lot about what makes a successful Amazon business. I've been in the game for over a decade and I've seen major failures and magnificent successes, and I've also experienced the ups and downs of running my own Amazon business.
If there's one critical factor that contributes to achieving success as an Amazon seller, it's the ability to develop a deep understanding of what products sell on Amazon, and why. But it's hard to try and do this for each and every category on Amazon, which is why there's power in choosing a niche.
To some, choosing a specific niche might sound limiting, and this is not to say that selling a broad range of products can't also be extremely lucrative, but starting out in a particular niche can help you quickly find winning products to sell and will help pave the way for a long and successful business.
Before we discuss how you can find an Amazon niche, you first need to understand what a niche is and why they are important. Let's dive in.
What is a Niche and What are the Benefits?
I've got a lot of friends in the online business and marketing space and the successful ones all share a common trait. They operate within a niche without ever deviating too far from it.
A niche can be described as a specialized segment of a particular market. Or to put it in even more simple terms for Amazon FBA sellers, the different Amazon product categories could all be described as different niches.
The categories or departments on Amazon are quite broad though, and many successful sellers usually operate in smaller, more targeted niches (but not all of the successful sellers, of course).
If we look at the broader niche category of Automotive on Amazon, you'll see that you can go deeper into sub-categories.
These sub-categories are also niches, within the Automotive niche. If you are deadset on "niching down", you would be better off operating at the sub-category level rather than the broader category level.
Some FBA sellers I know deal only in health and beauty, while others only deal with specific beauty accessories because that's where their knowledge and expertise lies.
Why is it Important to Operate in a Niche?
While its not absolutely critical to success, it makes business a lot easier if you specialise in a specific niche or two.
The benefits of selling in a niche market are as follows:
- You, as the business owner, become the expert. Being knowledgeable about what does and does not sell on Amazon in a specific niche is very high-value intel.
- Loyal, repeat customers. Over time, customers will see you as an authority in the niche and they will come back as repeat customers.
- It's much easier to brand yourself and your business if you operate in a small number of closely related niches.
- If you ever decide to market your business with paid ads, it is much easier to stick to a niche that you know. Creating your "offer" is much easier when you are a niche specialist.
- Niche sellers have a competitive edge against new sellers trying to enter the niche. This comes back to the first point, being the expert in the niche. You know what sells, when it sells, and how shipping works etc.
How to Find a Profitable Niche Product on Amazon?
First and foremost, you should understand that over 50% of consumers in the USA start their product search on Amazon. So if you find a potentially lucrative niche somewhere in your travels, there's a very good chance that it is going be selling on Amazon.
Here's some of the best ways that you can research and find profitable Amazon niches:
Use Amazon's Best Sellers Lists
Starting on the Amazon marketplace is the most logical way to find a profitable niche.
The Amazon best sellers are updated frequently and you can start browsing products, reading reviews, and familiarising yourself with potential profitable niches.
Check the Amazon Movers and Shakers
Much the same as the best seller lists, use the movers and shakers to find trends, check reviews and identify potential niche products that you can research further.
Use a Keyword Research Tool
Personally, I don't use this method too much but it can still help you on your journey finding a profitable Amazon niche.
You need to start with a product name as your seed keyword and if you're using an Amazon keyword tool like Keyword Wizard, you'll get a heap of related niche keywords (search terms) along with the search volume and competitors, which will help you start shortlisting some niche and product ideas.
Uncover Niche Ideas with Tactical Arbitrage
Tactical Arbitrage is by far one of the greatest, and most powerful, tools for Amazon sellers. It's difficult to explain how the software works in just a few sentences, but you can definitely use it to uncover profitable niches on autopilot.
Using Tactical Arbitrage to find profitable niches is as simple as switching on their "Always be Scanning" feature. It works just how it sounds, it is always scanning. You can literally wake up in the morning and see the niche products it has found for you to sell.
Find an absolute winner? This could be your new Amazon niche.
Suggested Reading: Tactical Arbitrage Review
Reverse Search for Competitor Analysis
Conducting competitor analysis should be a standard for any business, especially Amazon sellers. We could create an entire online course about the different ways to analyze your competitors, but one of my favorite ways is to start with the Amazon best sellers list.
Once you find some winning products, dig deeper into the actual seller and then plug that seller ID into Tactical Arbitrage's reverse search.
The reverse search will then go and find their products online and show you where you can buy them from, and how much profit margin you are likely to make if you decide to source them.
You can also enter specific Amazon ASINs into the Tactical Arbitrage reverse search feature, or choose to scan the Amazon best sellers or movers and shakers.
This is a very powerful tool to find high demand, low competition, best selling niches!
Study The Trends
Google trends is a truly amazing tool. It is great for picking up on seasonal items, like this example below.
Obviously something like a snow board is going to be seasonal, but for the sake of this example it highlights perfectly how Google trends shows data for seasonal items.
Look Inwards and Use Your Own Expertise
Are you passionate about something, like a hobby, or can you use your current occupation as a way "in" to a specific niche that might give you an advantage over others?
It's often said that you should "love" what you do, which I don't believe is entirely true, but if you have knowledge about a particular niche then that will set you ahead of the pack.
On social media platforms like Facebook, there are millions of niche communities. Join them, engage in the conversation, and learn more about the niche.
Simply type in your niche, look for groups, and explore niche communities that look relevant. This is a great way to immerse yourself in a niche and find out what their needs and wants are.
Because Amazon is the world's biggest marketplace, you're guaranteed that a certain percentage of these consumers will shop there.
Final Tips for Finding Profitable Niches
As we wrap up this guide on how to find a niche on Amazon, let's cover a few takeaways that will serve you well!
- Seasonal items are not necessarily bad, but just be prepared to "weather the storm" so to speak when they are not in season and the sales volume drops.
- Trending products are great but beware, if you get onto the trend too late and you buy a heap of inventory, you might get stuck with products you can't sell.
- Everyone wants to find those golden, low competition niches, but don't forget that competition also shows there's demand.
- If you have aspirations to develop your own private label products in the future, becoming a niche expert is going to help you massively.
- Familiarize yourself with Amazon FBA storage, shipping and fulfillment costs. They need to be factored in to your numbers to ensure you're making a profit.
- And finally, don't feel like you absolutely need to sell in only one niche. It is easier to start that way, but you can also learn online arbitrage skills like we teach in the OA Challenge and all you're going to look for is profitable products, no matter what type of product they are.
Thanks for reading this guide and how to find a niche on Amazon. I hope it serves you well on your Amazon journey!