Sep 06, 2023 12:00AM
Maximize profit, not listings on Amazon. Focus on margins, not just listings. Use a data-driven strategy: know your Net PPM, assess the ASP-cost ratio, utilize tools like Profitero, and list wisely to sidestep Amazon issues. Thanks, Martin.
Stop listing your products with #Amazon 🛑✋
Forecast their profit margins instead.
I see far too many vendors offering their entire portfolio to the online marketplace.
Only to see their margins diluted a few weeks later.
The problem is:
If you ignore your ASP in the market, you can expect Vendor Managers to demand margin compensation or delist your products.
✅👇 So here's what to do instead:
1️⃣ Find out your average Net PPM for the last 12 months.
2️⃣ Identify the ratio between the ASP and the cost price of your products listed on Amazon that will allow you to reach your Net PPM target.
3️⃣ Use tools like Profitero to determine the ASP in the market for the product(s) you want to list on Amazon.
4️⃣ List mainly those products that meet or exceed your identified ASP-to-cost ratio (and earn you a margin).
Following this 4-step process ensures you adopt a data-driven approach to listing profitable selection with Amazon.
And reduces the likelihood of Amazon CRAP'ing your products and Vendor Managers asking for more cost support.
Do you follow a selective portfolio approach with Amazon?
Let me know in the comments!