How to make money on amazon?
Starting to sell on amazon is one of the safest, most effective and sustainable ways to generate passive income. The platform has become the reference in global eCommerce worldwide and its seller portfolio and revenues are growing steadily.
Amazon has revolutionized how online shopping is perceived by creating the highest levels of trust, efficiency and security in shopping. That is why in the last 5 years, Amazon has dominated global e-commerce thanks to its logistics, delivery and fulfillment methodology.
Amazon's warehouses in the world's most important markets use the most innovative and cutting-edge technology. With a perfect combination of efficiency in order management and delivery, shoppers rely on the platform as a security benchmark.
One of Amazon's greatest contributions to eCommerce is its collaborative sales method, creating consistent revenue for its sellers. Businesses and individuals who have learned to make money on amazon have experienced growth that is difficult to achieve through other channels.
In addition, Amazon's fulfillment systems and Amazon's affiliate programs generate revenue for millions of people. More than a marketplace, the platform has become a unique and revolutionary business philosophy.
Selling products is one of the ways to generate income on the platform but is not the only one. Amazon has created different growth alternatives for its sellers and affiliates that are very interesting.
Let's look at how to make money on amazon using their sales and fulfillment programs. Also, let's look at the best income options Amazon offers for its investors and affiliates.
How to make money on amazon with FBA and FBM?
Selling our products on Amazon is one of the most efficient ways to reach a total and growing global market. The platform's worldwide presence promotes its vendor's sustainable growth as one of the pillars of its eCommerce success.
To learn How to make money on amazon we must understand its two most important sales systems. The company has two warehouse management, logistics, packaging and shipping systems that we must analyze in detail.
The eCommerce giant created by Jeff Bezos offers its sellers two sales methodologies: Fulfillment By Merchant and Fulfillment By Amazon. Both systems allow companies and individuals to sell on the platform with the same positioning and reach.
The difference lies in how goods, shipments and product logistics are managed. Let's take a look at how both Amazon product management systems work.
Fulfillment By Merchant
Fulfillment by Merchant (FMB) is one of the most frequent business alternatives to earn money on amazon. It is a business structure in which the seller is in charge of the sale's packaging, labeling, storage, and logistics.
This program is ideal for sellers with more market experience, warehousing, and logistics infrastructures. Amazon and the seller create a partnership that excludes fulfillment and shipping.
Many sellers choose the FBM option because of reduced costs and reduced expenses. However, it is important to consider that Amazon is relieved of shipping and product preservation responsibilities.
For this reason, the seller bears full responsibility for any damage in the handling and shipping of the product. It is the seller who assumes all returns and incidents with the product.
The major advantages of Amazon's FBM program are:
- The seller controls 100% of the sales process, from the order until the buyer receives the product.
- Customer service can be more efficient and personalized, creating greater brand equity.
- The buyer's data is transmitted to the seller, who will be able to carry out short, medium and long-term marketing actions.
- Sellers in FBM can optimize their costs by choosing shipping, packaging, presentation and logistics methods.
- As a seller, you can offer the buyer different shipping and handling rates generating revenue more efficiently.
- To optimize fulfillment costs, warehousing, human resources, transportation, or vendor management systems.
Fulfillment By Amazon
The Fulfillment by Amazon (FBA) system allows individuals and companies to optimize their sales, logistics and warehouse management. It will enable sellers to use all of Amazon's fulfillment processes, including logistics, warehousing and shipping.
Amazon assumes all warehousing, sorting, labeling, packaging, handling, shipping and returns management. Sellers have the company's transportation network, warehouses, operators, systems, fulfillment and shipping software at their disposal.
These services generate some costs that Amazon charges the seller in commissions, flat and maintenance fees. In addition, Amazon has several rules and regulations that must be strictly adhered to.
On the Amazon Sellers page, sellers can see the different costs and expenses of the FBA service, as well as the conditions and rules of the platform. Even so, the FBA modality has experienced steady growth in the last 5 years on Amazon.
The main advantages of this modality are:
- The seller offloads shipping processes to Amazon faster thanks to Amazon's infrastructure.
- Amazon has a presence in major markets around the world with a comprehensive service structure.
- Prime shoppers can count on same-day shipping at no additional charge and arrive within 24-48 hours through the Amazon Prime delivery system.
- The platform is a world leader in warehousing, shipping, packaging, labeling and shipment tracking processes, giving the seller greater sales and customer service capabilities.
- Fulfillment by Amazon is ideal for dropshipping and generating more accurate and effective revenue.
Amazon Affiliate Program
Selling products on Amazon is not the only way to generate income through the platform. Amazon has many options, such as Amazon affiliate programs, an excellent alternative to generate income with low and growing investments.
If you're wondering how amazon's affiliate program works, it's a way for content creators and marketers to earn money sustainably and passively.
By monetizing traffic from its pages, Amazon has created a very interesting revenue generation structure.
Amazon affiliates can earn commissions for each product recommended and sold by the recommendation of products sold on the platform. For each user who buys a product from a recommendation, Amazon will pay its affiliates a commission.
Commissions can be as high as 12% of the price of some products. This can be a very attractive way to generate passive income. Amazon affiliates must design, create recommendations and position their pages to generate more traffic.
As more people click on the affiliate's links and buy recommended products on Amazon, the more money you will earn. Amazon affiliate programs are especially interesting for influencers, content creators, bloggers and marketers.
There are no limits on participation, number of recommended products or recommendation pages. In addition, anyone can recommend products on Amazon using websites, blogs, social media profiles or other digital alternatives.
Many professionals and business sites leverage their web and social media traffic to generate sales. These recommendations can generate long-term revenue without requiring constant investment or updates.
Advantages and disadvantages of Amazon affiliate programs
Amazon Affiliate programs are one of the easiest, low-investment ways to create consistent, sustainable, growing revenue on the platform. Amazon Affiliate programs make product recommendations across categories, price points, sizes and regions, multiplying revenue streams for businesses and individuals.
Among the main advantages of the Amazon Affiliate Program, there are:
- It is a way to generate revenue without investing in stock, warehousing, materials or other expenses and costs associated with selling products.
- It can reach a global audience, as it is not limited to a specific geographic area and a single affiliate can create recommendations worldwide.
- It is one of the most effective forms of SEO positioning for web projects, creating constant and growing feedback.
However, Amazon affiliate programs have some conditions and knowledge that the affiliate must master. Some of the most important disadvantages are:
- Understanding of SEO positioning, web traffic and digital marketing techniques is required.
- Quality, unique, attractive content must be created to encourage users to buy the recommended products.
- They may have low conversion rates.
- Regular updating of content and recommended products is required.
- It requires researching niches, consumer behavior, keywords, search intentions, and other marketing actions.
Buying and selling Amazon Affiliate Websites
One of the fastest growing business alternatives in recent years is buying and selling digital properties. Companies and individuals can buy websites monetized through amazon affiliates with good positioning and high traffic.
A page positioned at the SEO level and with a positive conversion rate becomes a high-value asset.
For a buyer, this saves time, resources and effort in marketing, research and web optimization. From the first moment of purchase, the new owner can generate revenue.
For the seller, selling a business that works with amazon can be quite interesting due to the effort required to scale the project and the benefits generated. Some people and companies are beginning to see this business model as interesting; they only have to create a website, position it, start billing and then sell it for big figures.
At Trustiu, we help you buy and sell this type of digital asset and we will advise you throughout the process. We will help you value the business and transfer it safely if you are a seller. If you are a buyer, we will take care of finding the company that suits you best and help you throughout the purchase and transfer process. If you have any questions you can contact us, one of our consultants will be happy to help you.