Amazon has developed many features in Seller Central designed to help increase sales. However, we here at AMZ Advisers find that too often sellers do not know how to utilize all the features properly. The available promotions under the advertising tab can be a powerful boost to your Seller Central account. Creating a promotion strategy to grow your Amazon sales is something that every Amazon seller should consider.
Many sellers may be familiar with offering huge discounts at product launches. But we’re not talking about giving away your profits to try to boost your sales. Utilizing the promotion strategies that we will outline in this blog post can increase your sales without losing all your profit. These strategies are designed to take advantage of your best listings, increase order values and maximize your product revenue.
3 Promotion Strategies to Grow Your Amazon Sales
1. Increasing Your Conversion Rate with Coupons
Conversion rates are a metric that a lot of Sellers do not pay attention to. Many sellers just focus on overall sales numbers, but the amount of people coming to your page and buying is just as important as your gross sales. Conversion rates are a huge relevancy signal to Amazon that your product should show up for a keyword search. Optimizing your conversion rates can also lead to massive sales boosts.
We’ve found that coupons are an incredibly powerful tool to increase conversion rates. We recently worked with a client that had been struggling with sales. Their sales decreased from a high of $40,000-plus a month down to $18,000 a month. Their listings generated a ton of page views, but their conversions rates were absolutely terrible at less than 1 percent. By implementing a small coupon for a 5 percent discount, their conversion rates more than tripled to 3.5 percent-plus. That ended up being an additional $60,000 a month in sales for them.
Don’t run constant coupons on your products, however. You will only end up cheapening your brand and losing additional profit unnecessarily. We would recommend looking at your business reports to see which products your conversion rates are sub-optimal. Then, utilize coupons to boost those conversion rates and increase sales. This can be particularly powerful going into a high sales period as the increased conversions can grow your Amazon visibility.
2. Using Tiered Promotions to Increase Average Order Value
Another metric that is not well understood by many sellers is your average order value, or average sales/order item in your business reports. It’s hard enough to get a customer to buy your product. Once you find one that is interested it’s a great idea to try to upsell them on purchasing additional products or a larger quantity.
Creating a tiered promotion can be simply done with a Percentage Off promotion. We usually create multiple tiers for the promotion – Buy 2 get 5% Off, Buy 3 get 10% Off, etc. You can set the tiered discount at whatever level you want. A high percentage off could increase sales, but it will also be costing you more of your profit. We have seen these promotions to be very successful even with a lower percentage off.
For example, let’s say you are selling 1,000 units a month of a product that sells at $10. Implementing a tiered promotion strategy that increases your units sold and average order value by 10 percent (through customers buying multiple products), would increase your total sales from $10,000 to $11,000. That same 10 percent increase in units is 100 more a month. A 5 percent discount when a customer buys two or more would come out to a minimum of $1 discount per order—making your net revenue gain $900.
3. Cross-Selling Products with Percentage Off Promotions
Taking advantage of your highest traffic listings to cross-sell other products in your catalog is another great promotion to run. The two main challenges in Amazon are getting traffic and getting conversions. We’ve already address conversion rates with our coupon strategy. But using your highest traffic listings to drive traffic to products that don’t perform as well is great for moving excess inventory or trying to build sales velocity.
These promotions are created under the Percentage Off promotions by selecting a qualifying item. They show up on the product detail page with a convenient button allowing a shopper to add both products to their carts. The visibility isn’t as great as coupons on the listing. But you can still get an additional sales boost from this type of promotion.
One of our clients had excess inventory at Amazon that they wanted to move out of FBA. Instead of removing the inventory and paying to have it shipped back, they wanted us to implement a cross-selling promotion. We created these promotions on their top five traffic listings and the results were good. The cross-selling promotions lead helped the client move 92 units of a product that was previously selling poorly. This not only increased their average order value, but also helped the client avoid long-term storage fees.
Using your highest traffic listings to drive traffic to products that don’t perform as well is great for moving excess inventory.
Following the Seller Central Promotions we outlined here can help you grow your monthly sales dramatically. Deciding what type of promotions to run requires a thorough analysis of your account data. Your goal needs to be growing your sales and not providing blanket discounts on every product – especially if they are performing well. Don’t sacrifice profits unnecessarily by continuing to run promotions. Utilizing an effective promotion strategy will maximize your revenue and increase your sales over time.