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The Amazon Marketplace has flung the doors of eCommerce open for sellers of all sizes and experience levels. As an Amazon seller, you get lots of options for listing, branding, and shipping your products. Amazon Private Label offers an accessible and affordable way to sell customized products under your own brand name.
Although it may seem daunting to try to break into a market with your own branded product line, more than three-quarters of Amazon shoppers are willing to buy private labels over known third-party brands. The most successful private label sellers will be those who take the time to understand the special opportunities and challenges of this sales model.
To help private label sellers thrive in Amazon’s highly competitive marketplace, we’ve put together this list of tried and tested advice for launching a private label Amazon store and growing it into a profitable venture.
Amazon Private Label: What You Need to Know
A private label product is manufactured by a third party but sold under the Amazon seller’s own branding. These products could be identical to those sold by other brands, customized by the seller, or entirely unique and original—that’s between the seller and the manufacturer.
Private labels allow you to sell unique items without having to get directly involved in the manufacturing process. Many private label sellers opt into the Fulfilled by Amazon (FBA) service, outsourcing the warehousing and shipping of their products. But one service does not require the other.
There are no specific requirements for private label products. You only need a Seller account and adherence to the same rules and standards that apply to any other product. However, you will want to acquire a trademark for the branding you intend to use.
The Benefits of Being an Amazon Private Label Seller
Private label selling isn’t for everyone. Some products won’t be cost-effective or even possible to source from third-party manufacturers, and not every market will be equally accepting of new brands entering the fray.
However, when private label is a viable option, it has some notable advantages:
- Branding Control – The colors, logo, styling, and other aesthetic elements of the product and its packaging are based on your brand, not somebody else’s. All of the decisions about how to market and price it are yours alone to make.
- Higher Profit Margins – Purchasing goods directly from the manufacturer cuts the wholesaler out of the picture and lowers your costs. Selling unique products also creates sales growth opportunities and can justify premium pricing.
- Ease of Customization – If you want to change the look of a product or have an idea of how to make it perform better, the private label model allows you to negotiate product customizations from the manufacturer.
- Free Parking in the Buy Box – When you’re selling third-party brands, you’re competing for the Buy Box with every other seller who carries the same products. With a private label, you’re the only seller of your own unique brand—and you’ll own the Buy Box on all of your product listings.
8 Tips for Success as an Amazon Private Label Seller
1. Master Advanced Market Research Techniques
A winning strategy starts with in-depth research into products, audiences, competitors, and the market itself. Utilizing advanced tools and data analytics allows you to identify product niches and market gaps that will be receptive to the private label approach. You can also find the specific trends and products that are likely to yield the highest profit margins.
Further opportunities can be found by combining consumer trend analysis with competitive intelligence, providing you with a clear view of where demand is heading, how the current retail market is responding, and what you can do to stand out positively. Noogata’s competitive intelligence features help you uncover these insights and factor them into an optimized strategic plan.
2. Implement Sophisticated SEO Strategies
Effective Amazon SEO requires a foundation of keyword research that tells you all the different search terms potential buyers use to find your products. Don’t stop at the most popular keywords—identify the lesser-used but relevant keywords where your ad dollars can go farther, long-tail keywords, and keywords favored by your competitors
A/B testing your listings with different product titles, bullet points, and descriptive copy generates live performance data you can use to optimize your SEO strategy continuously
3. Develop a Premium Brand Identity
You can build a recognizable, trustworthy image for your private label by crafting a compelling brand story that resonates with the values and aesthetics of your target audience. Every element—from the logo to the color palette, fonts, and packaging material—can impact customer sentiment, so it’s often worth enlisting the talents of professional designers
Before finalizing your branding choices, make sure they’re compliant with Amazon’s product listing standards. Once that’s verified, use your branding elements to project a consistent image across all customer touchpoints. This is your chance to make your brand synonymous with premium quality, but your products and customer service have to back up the image.
4. Optimize Amazon Advertising with AI and Automation
AI tools excel at automating bid management, keyword adjustment, and other processes that can simultaneously bring down your advertising costs and enhance their effectiveness. For example, with Noogata’s AI-based solution, you can realize a high ROI on basic display ads while leveraging advanced pay-per-click ad strategies like retargeting and sponsored brand campaigns.
AI can crunch data and respond to change with more consistency and speed than any human operator. Including performance data in your analytics lets you implement continuous PPC campaign optimization on a rapid scale, which will keep you on the leading edge of market trends and generate consumer demand.
5. Implement Advanced Inventory Management Systems
Integrating predictive analytics into your inventory management system can significantly improve your demand forecasting and inventory planning. With accurate and timely information, you’ll be able to implement just-in-time inventory practices that keep your costs down and your efficiency up.
Ensure your inventory management software is multichannel compatible. It also must be capable of handling your data from Amazon data and any other fulfillment channels you’re using.
6. Leverage Data Analytics for Strategic Decisions
Any time you can collect data related to a particular process, you have an opportunity to optimize that process by using the power of analytics to make data-driven strategic choices. Software solutions that analyze data in real-time can empower you to make quick decisions, pivoting to catch emerging market trends before your competition does.
AI-powered tools can provide private label sellers with the actionable insights they need to grow their Amazon business. Examples of this are using AI analytics to analyze competitor intelligence data to uncover the market trends that other sellers are expecting, or analyzing the data from your eCommerce website to find shopper preferences.
7. Build Trust and Credibility with Social Proof
Polished marketing content is never as effortlessly trustworthy as honest opinions from peers and colleagues. Social proof is one of the most directly effective ways to build trust and authority within your market, but it has to be earned.
To do this, start by encouraging your customers to provide reviews and ratings on Amazon, and ask your most satisfied customers for testimonials or case studies you can feature on your product pages. Explore the possibilities of influencer marketing and user-generated content, including employee advocacy campaigns.
Finally, engage with critical reviews and social media comments that give you the chance to demonstrate your responsiveness to customer feedback.
8. Optimize Your Supply Chain for Efficiency and Scalability
Tighten up your fulfillment process and reduce its costs by streamlining the relationships and communications you have with your suppliers.
Whether you use FBA and other Amazon features or third-party offerings, you need to have the right technological solutions for inventory, fulfillment, and other aspects of supply chain management. Assortment planning software, for instance, can help you make more efficient decisions about what products to stock and when to purchase them.
Whichever solutions you decide to go with, it’s essential to make sure that they’ll scale alongside your business, meeting increasing customer demand without compromising the quality of your products or customer service.
Build a Robust Private Label Brand with Noogata
Competition is always thick on the Amazon Marketplace. As a private label seller, you have to compete on the strength of your own brand rather than the brands of the products you sell. Leveraging data analytics to create a comprehensive strategic plan is one of the surest ways to set yourself up for success, especially if you have the right tools to complement your strategy.
Noogata’s AI-driven Amazon eCommerce solution gives sellers some of the most effective tools for enhancing the private label sales experience, including an AI Amazon Assistant. With features for competitive intelligence, sales insights, and Amazon digital shelf analytics, Noogata has every angle covered for sellers who want to outperform the competition.
Book a demo today to discover how Noogata helps your Amazon private label business grow.
