How to Make Money on Amazon: Your Guide for 2020

Amazon is without a doubt one of the most profitable companies on the planet, and for good reason. It’s reliable, secure, and gives shoppers access to nearly anything they could possibly want.

And while most of us are busy spending money on Amazon, a lot of people have learned how to make money on Amazon. Today, we’re going to show you exactly how you can join them.

More specifically, we’ll take a look at:

  • How to choose, verify, and sell products on Amazon
  • How to create an Amazon listing
  • How to make money on Amazon without selling
  • How to use your website to drive conversions through Amazon

How to Make Money on Amazon by Selling Products

When we talk about making money on Amazon through selling products, people tend to fall into two categories:

  1. Those who have an established business with a product to sell
  2. Those who are starting from scratch

If you have an established business with a product ready to sell, you’re at an advantage because you won’t need to spend time researching manufacturers. However, you may still want to verify that Amazon is the right place to sell your product by doing some market research (which we’ll cover shortly).

If you are starting from scratch, you’re wondering, “What about me? How do I start an Amazon business?” Well, you have the advantage of optimizing your product research and knowing what will, or won’t, be a good investment for your Amazon storefront.

You’ll likely want to work with Fulfillment by Amazon (FBA) which can handle all the details like packing, shipping, customer service, and more. As you can imagine, that service comes with its own fees which you’ll need to take into account.

Whether or not you already have a product, you’ll need a website to drive traffic and boost conversions. Don’t worry, we’ll cover that at the end of the article.

For this section, though, let’s explore what makes a good product to sell on Amazon. Here are three questions you should ask yourself when verifying whether or not your product will make money on Amazon.

1. Is there a demand for the product?

As every online merchant knows, it’s pointless to manufacture and sell something that nobody is asking for. Henry Ford’s famous quote, “If I had asked people what they wanted, they would have said faster horses” is an example of the exception, not the rule.

If you’re starting from scratch, a great place to begin your research is the Amazon Best Sellers page. Here you’ll find ideas in each category for products that are in high demand.

amazon best sellers home page

If you already have a product in mind, however, you’ll want to look through similar items already on Amazon and check their “Best Sellers Rank” (BSR) which can be found on any item description.

So, for example, if you were selling pens, you’d look at your competition (in this case, the popular pen brand BIC):

amazon best sellers check out competition

Then you’d scroll down to see BICs Best Sellers Rank:

amazon best sellers ranking

This number will tell you the product’s overall position in a specific category. But don’t be fooled. Even if the BSR for a similar product to yours seems high, it may still be doing well when compared with the number of products in the category at large.

In this example, the BIC pen is ranked #3,710 in the category “Office Products.” However, the total amount of items for sale in “Office Products” is over 50,000, so these BIC pens rank comparatively well in the overall category.

2. What’s the price point/profit margin?

When it comes to calculating your costs of production, shipping, and Amazon expenses, the bottom line will be asking yourself the following question:

Is it profitable to sell on Amazon?

For some retailers, selling on Amazon makes sense; for others, not so much. It really depends on your product which is why it’s better to answer this question sooner rather than later.

While every online merchant will need to answer this for themselves, here are a couple of helpful tips to keep in mind:

  • Be realistic about your product’s price. Most sales on Amazon take place from organic searches on page one. Overpriced items are rarely seen by potential customers so make sure you’re pricing items to be competitive but profitable.
  • Be realistic about the cost of production. How much money (and time) are you spending to manufacture your product? If you’re seeing $1000/week in revenue from Amazon, but it’s costing $600/week and 60 hours of your time to get everything accomplished, you’re looking at roughly $6.50 an hour.

The problem is that a lot of people forget about hidden costs when selling on Amazon which may include:

amazon seller central hidden costs

As you can imagine, all these little expenses can add up quickly. Stay organized, track what you’re spending (both financially and with your time) and make sure you’ve priced your item in a way that makes the whole operation worth it to you.

3. How’s the competition doing?

As you’re looking through your competition’s BSR and product listings, be realistic about how well you can compete with them. Consider the following questions as a helpful guideline:

Is your main competition a large brand like Nike or Sony? If so, they’ll be hard to compete with on price, quality, and range of products.

Does your competitor’s product have any negative reviews? If so, would your product solve or fix the problem the unhappy customer had?

bad review

As mentioned, does your competitor’s BSR indicate a high or low demand? If it shows a high demand, great! If not, you may want to investigate a little more.

Once you’ve verified that you have a good product to sell, you’ll simply need to create an account on Amazon Seller Central and add your product.

Note: In this post, we don’t get into how to get your products manufactured. If you have an idea for a product and want it produced in bulk, a popular site is Alibaba. There you can create, customize, and order products to sell on Amazon.

How to Add an Amazon Listing

First, create an account on Amazon Seller Central. At this point, you’ll be asked some basic information such as business address, telephone number (for verification), credit card information (for the $39.99/month fee), and passport information to confirm your identity.

amazon seller central what you need to register

Once your account is created, you just need to make a product listing. To do that, visit the Dashboard of your Amazon Seller Central page, click on Inventory and Add a Product.

create amazon seller product listingImage Source

Then you can click Create a new product listing.

amazon seller central add a product

Now you’ll choose a category for your product:

amazon seller central product listing category

And finally, you’ll need to fill out some basic information or Vital Info which includes the product’s name, manufacturer, brand name, and other specifics related to your product:

amazon seller central vital info

Quick Tip: You should also add high-quality images and keywords to help your product rank higher.

Once you’re satisfied with your product’s description, you’re ready to start selling! At the end of this article, we’ll discuss how to use your website to drive sales and conversions.

But before that, let’s take a look at a technique for making money on Amazon that doesn’t require coming up with a physical product to sell.

How to Make Money on Amazon Without Selling a Product

If you’re not someone who wants to deal with manufacturers, shipping problems, or large Amazon fees, don’t worry. You can still make money on Amazon without selling anything.

How? With Amazon’s Affiliate program. Here’s how it works:

First, you’ll need to start a blog or launch a mobile app. For the purposes of this article, we’ll assume you want to keep it simple and start your own blog. If you’re totally new to this, no worries! WPBeginner has an excellent guide to help you start a blog right here.

Then, you need to choose a niche for the content of your blog. Just like when choosing a product, you’ll want to do some market research at this step, but you’ll also want to be sure you’re choosing a topic you love because (spoiler alert) you’ll be doing a fair amount of writing on that topic.

Once you’ve settled on the content of your blog, you’ve reached the hard part: building up your audience and email list. Fortunately, OptinMonster can help you with that.

With OptinMonster, you can create popups, landing pages, and hello bars to create leads and grow your email list.

You should be focused on two things at this point: increasing traffic to your site and building a solid email list with engaged users (meaning you want them to actually open the emails you’re sending). We’ll be talking more about this in a minute.

Once you’ve got a decent amount of traffic visiting your blog, you’re ready to sign up to become an affiliate associate with Amazon.

Boost Traffic: 25 Proven Strategies to Increase Your Blog’s Traffic by 1064%

The program is 100% free to join (which can be a huge incentive for people not comfortable with Seller Central’s $39.99/month fee). It’s also a very simple, three-step process.

amazon affiliate program to make money on amazon without selling

Here’s how it works:

First, you need to join the Amazon Affiliate Program (also known as “Amazon Associates”). You’ll be prompted to hook up your current Amazon account or create a new one.

Amazon will show your name and address to confirm this is the correct information for payment. If not, you can always change your address:

amazon affiliate program account information

Then, you’ll need to add the websites that you want to enroll in the Affiliate Program:

amazon affiliate program website information

Next, you’ll build out your profile with some basic questions about your website including an Associate’s Store ID, a brief description of what your store is about, and topics that best describe your content:

amazon affiliate program creating your profile

Now comes the fun part: looking at traffic and how you plan to monetize your blog.

You’ll choose the methods you use to drive traffic and talk about how many visitors you currently have. If you don’t have many visitors yet and aren’t currently making any revenue from your site, don’t worry! You won’t be penalized at this point.

amazon affiliate program traffic and monetization

Then just confirm your profile and you’ll be ready to start getting links to make money on Amazon without selling anything!

But keep in mind that you only have 180 days (or 6 months) to be successful.

If you haven’t made any money through Amazon’s Affiliate Program by that time, your account will be closed. That’s why it’s important to build your site and email list before enrolling in Amazon’s Affiliate program.

amazon affiliate program confirmation

Now it’s time to add a product link!

Keep in mind that creating revenue with Amazon’s Affiliate Program can be done in many ways (far too many to cover here). Today, we’ll just be looking at Product Linking.

First, on Amazon Associate’s homepage, go to Product Links under the menu header Product Linking.

amazon affiliate program product linking

Once here, you can search for products that would match the content of your blog. In this example, we’ll get a link for “pens.”

amazon affiliate program product search pens

After clicking Get Link, you’ll be taken to a page where you can customize the link for your content. You can choose between text and image, text only, and image only.

You may then customize the link to fit your needs and see a live preview of how it will appear on your site.

amazon affiliate program build customizable link

Finally, you will have access to the HTML for the link which you can insert into your website:

amazon affiliate program html for link

And that’s it! Once you’ve added the HTML to your website, you’ll be ready to start earning commissions on products purchased from that specific link. Which brings up another important question:

Can you make money with Amazon Affiliate?

It’s a great question with, unfortunately, a not-so-simple answer. In short, yes. But how much money you can make on Amazon Affiliate depends on a few things.

For starters, you earn commission depending on the type of product you’re linking to.

What are the best products to sell on Amazon? Well, Luxury Beauty items will get a 10% commission. Video games, on the other hand, will only get you a 1% commission.

Here’s a chart to help you see what you can earn by product and category:

amazon affiliate product categories for commission

This is why it’s so important to do research before launching your business. You want to make sure you’re linking to items from your website that will earn a high enough commission to make this entire process worth your time and energy.

How to Drive Amazon Conversions Using OptinMonster

When it comes to making money on Amazon, you’ll need a website with decent traffic whether you’re selling a physical product or working with affiliate links. However, more than anything else, your biggest savior will be a robust email list.

OptinMonster has many features designed to help you grow your email list. From custom forms to strategically timed optins to A/B testing capabilities, OptinMonster can help you convert casual readers into a loyal, engaged audience.

And it’s simple.

So simple, in fact, that you can create a lead-generating optin in under 5 minutes! Here’s just one example of what you can do with OptinMonster in a matter of minutes:

Grabs attention, doesn’t it? Check out our optin gallery for more inspiration.

Once you’ve grown your email list, you’ll have tons of warm leads to advertise your products on Amazon or to share content with affiliate links inside. With some hard work, a bit of patience, and the right tools, you’ll be on your way to making money on Amazon in no time.

If you’re interested in setting up your own affiliate program, we got you covered. Take a look at our guide to starting an affiliate program.

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Nathan Thompson
Nathan Thompson is a father, a writer, and a lover of travel (in that order). When he’s not wrestling with his kids, you’ll likely find Nathan giving his eyes a much-needed break from screens with a good book or planning a family trip with his awesome wife.

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