Here’s a good question I get from time to time, with a lot of wrong answers being given.
Here’s an easy way to understand why something shows up in your Search Term Reports.
If a user is looking at [X] and they click on your ad, [X] will show up in your search term reports.
So, if a user is looking at “Amazon’s search results for the word ‘pickle juicer'” and they click on your ad, you will see “pickle juicer” in your search term reports.
However, what happens if a user doesn’t pick on your ad (just pretend there is one) and they click on that first pickle juicer which is actually a pickle fork because there’s no such thing as a pickle juicer, work with me.
If they scroll down because this isn’t a pickle juicer they want and they see YOUR product down among the related products, and then click on it, Amazon treats this product page the same way it would a search result, and says “Well, a shopper was looking at this, and then went to your product, so you should know. Their ASIN is X.”
Okay I’ll just Negative Exact Match them.
According to this Amazon Employee, you can not Block ASINs, nor can you negative exact match them.
So. To recap:
1. If a shopper is looking at search term results, and clicks on your product, you will see a search term in your reports.
2. If a shopper is looking at an asin (a product), and clicks on your product, you will see an ASIN.
3. If a user is looking at the sun, and they click on your ad, well… Sunglasses are a small product, nice markup, light weight, but with a lot of competition. I wouldn’t recommend it.
This question comes up quite a lot, and the answer is…
Yes. Of course.*
As a general rule you can assume it makes sense to sell a cheap product, whenever you see someone selling it because… why else would they be selling it?
*There are weird fringe cases where a person might sell something at a loss, but Occam’s razor suggests that most people are selling things because it makes them money. In business, it’s safe to say that profit is everything.
The question with Amazon is actually never about the price of a product, the real question of worthiness is about the profit. Selling a $100 item 20x a day seems great because that’s technically a $730,000 a year business.
However if that item costs them $94 after shipping, manufacturing, Amazon’s commission, sales tax, PPC advertising, etc, it’s really a $43.8k a year profit business.
Compare that to an item that you sell for $12 but actually only costs you $5. At 20x a day that item actually generates more profit than the $100 item.
Beware the Add-On Badge
Items below a certain price (generally under $10.00) fall under the auspices of the “Add On Item” program. Amazon won’t ship these items by themselves because the cost of shipping might eat into their profit margin. Again, profit is everything.
This means that no one can really buy your product unless they purchase another product in the same order. This can greatly affect your sales, unless it’s the type of product that people frequently by multiples of, or with another item.
NOTE: I’ve heard a rumor that if you start your price at $9.99 and gradually lower it, you can bring the price lower and avoid add-on status, than you could if you were to just set it at a low price to begin with.
So, set your price to $9.99, then $9.79, then $9.59, etc, and inch your way to your lower price and see what happens.
Perk: Fewer Returns!
There’s an added upside to selling a cheap item. Fewer returns. If you buy something that costs $50 and it doesn’t work, you’ll likely return it. $12? Meh. You won’t even bother.
Now, we are of the opinion that you should never knowingly sell a mediocre product, but there are some wheels that will always be squeaky no matter how much grease they receive so it’s nice to cut back on the number of times you have to interact with them.
So, to recap. Check your costs, find your profit, make sure your price isn’t too low, and go for it.
First. You should be very very very quiet with this complaint or else someone that’s still sitting on 2,000 fidget spinners might spin all of them at your face in jealousy. Fidget spinner deaths are never pretty.
Second. Rejoice. This is the best problem to have in FBA.
First: Here’s what you shouldn’t do…
Gradually raise your price to slow down your sales to stay in stock.
Please don’t do this.
Amazon is a little bit like a bitter ex- and that they never ever forget, which is why if you ever get back together with them they will 100% remember the last thing you did.
So, if you were selling 200 items a day and then broke up with them (went out of stock) and then got back together they’d _assume_ you were selling 200 items a day and put you right back on page 1 with all the other winners.
If you were selling 200, then 100, then 20, then 2, Amazon says “Wow, this item really was getting unpopular at the end right before they went out of stock, so let’s just…place this here. On page 17. Page 17 is nice. It’s a fixer-upper. It has charm.
Step 1. don’t muck with your price by raising it.*
(*you can muck with it a little. sometimes by raising the price you might discover that you sell more. So, feel free to raise it until it has an adverse affect on your sales)
(i’m not sure the word muck is nice. It feels wrong when I say it and also when I type it, so maybe keep that in mind too. It’s the least important part of that step though)
Step 2. You can screw with your price by lowering it.
Screw just seems worse than muck but we’re stuck with it now gang.
If you lower your price as you are running out of stock, your sales velocity will actually increase (go figure) and then instead of going out of stock with a 200/sale a day item, you’re going out of stock with a 250/sale a day item.
It’s like if you’re breaking up with someone and then on the very last day you buy them a Tesla as a break-up gift. “I can’t be with you but here, it’s basically a huge battery with wheels I hope you love it.”
The current reigning theory is that when you come back in stock, Amazon will honor the 250/day rate and rank you accordingly.
Step 3. When you go out of stock close your listing.
To extend the broken relationship metaphor, imagine you break up with your ex- but in a great way. “Honey I love you but I’ve been invited to go to Botswana to help with the starving kids and I just can’t do long distance but I’ll be back in 2 months because you’re the love of my life. Please wait for me.”
Leaving your listing open is like… occasionally texting your ex during that 2 month period, every couple of weeks… but instead of sending a sweet I love you, you’re just texting them this:
“Hey you kinda suck.”
Then when you get back after 2 months you wonder why they Hey Kinda Dont Like You Any More.
This is because while you’re out of stock for 2 months while your listing is OPEN, there’s the chance that your product will get returns. And when Amazon gets a return that it thinks it can resell, it will put it on the shelf. And then that one item will sell.
So now suddenly you’ve got 200 sales a day for a year and then nothing, and then 1 sale on one day. Nice. You Kinda Suck in Amazon’s eyes and they’re not gonna forget it when you get Backswana.
Step 4. Don’t forget to raise your price when you’re sending your inventory in.
It’s a dumb thing but Amazon loses things all the time, basically Amazon will look at your historical price for a product, and sometimes (but not always) they’ll just look at your list price. So if you send in 2000 items with a list price of $20 and Amazon loses them, they’ll give yoU $40k. If you forgot to raise your price from $10, you’ll only get $10k.
JK it’s $20k I just wanted to give you that brief moment of satisfaction from having caught me in a mathematical error, because I love it when I catch other people in theirs.
If all this feels like a lot of work to have to do with one product, imagine doing the same thing with twenty products. Yeah you don’t want that life and I don’t want that life for you either. The best thing to do is keep an eye on your products inventory.
If you have 5 products and it takes you three minutes each to check their sales vs inventory and predict their stock out 3 times a week, that’ll mean you’ll spend (5*3*3*4, show your work) 180 minutes a month just checking inventory. That’s THREE HOURS every month, that’s 36 hours a year.
Or you can just sign up for Amachete and we’ll give you an easy page where we’ve done all the math and accounted for how long it takes your manufacturer to ship it so that you’ll know exactly how many days you need before you press that buy button.
You can just glance at it. And we’ll let you know if it’s getting kinda close.