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Costly New Amazon Seller Mistakes to Avoid

To err is human. But as a new seller on Amazon, one false step can represent a great loss of time and money if you don’t know how to deal with some situations. Although most successful Amazon sellers will tell you that mistakes are great learning opportunities, these omissions can get you booted out within 6 months.

The good news is that most of these mistakes can be avoided, and we’re listing them here so you can undertake action in order to face these mishaps:


Common Amazon Seller Mistakes


Your Account


1.  Registering for the Wrong Seller Account

You need to register for the type of seller account that suits your needs. An individual account is not the right move if you sell a lot of items each month. You’ll end up paying a huge amount in fees. If you sign up for a professional account and don’t sell more than 40 items a month, though, you’ll again be paying more than you need to.

If you’re not sure how much inventory you can move, it’s a good idea to start with an individual seller account. When sales pick up, you can easily upgrade to a professional account. You should also look into other options well-suited for multi-channel retailing, private labeling, artisan products, and as a manufacturer.

It’s important to consider if FBA fees are worth it at this point. Going MCF may be the best move for your business in the early stages.


2.  Not Reading the Terms and Conditions

One of the top Amazon seller mistakes is not following their Terms and Conditions, and this begins with not knowing them in the first place. The customer always comes first on Amazon. Customers can be unforgiving, so the marketplace is strict about the rules. Amazon suspends offending accounts regularly. You do get a chance to appeal and explain yourself, but lost time is lost opportunity.

Many sellers consciously try to game the system and end up in deep trouble. But there a lot of Amazon seller mistakes that are unintentional and can be easily avoided simply by knowing what is required and what is prohibited. Amazon’s Policies & Agreements page lays everything out clearly for that specific purpose of avoiding Amazon seller mistakes that can upset their customers.

Here are a few Amazon seller mistakes that can get you suspended or banned:

  • Registering for more than one Amazon account
  • Promoting your off-Amazon business (a URL on your listing or in customer messaging)
  • Misappropriating content (copyright violations)
  • Advertising products by putting discounts or coupons in the listing title

3.  Ignoring Policy Changes and Updates

Just as important as reading the rules is keeping up to date on policy changes. Amazon is always adding new things, so you need to pay attention when they send you updated notifications. Also, you need to make sure you are quick to comply if there’s anything you need to change.

Policy changes and metric updates are the most important, but general updates should never be ignored. You need to follow these to keep your listings current so you don’t confuse customers or find yourself unable to send in inventory because you’re in the wrong category.


4. Applying Other Marketplace Rules to Amazon

There are similarities among all online marketplaces. With Amazon, however, you will always have more differences. Each marketplace and the search engines within them operate on different concepts and algorithms.  


5.  Not Using Marketplace Services

One of the most common Amazon seller mistakes is not using the tools that they provide. These tools are specially designed to help you perform well in the marketplace. You may not like being forced to use Amazon tools – especially the paid services – just to be recognized. Unfortunately, it’s just part of selling on Amazon.

Most of the tools are free, though, and you really should be using them as often as possible because they give you great insight. Amazon is very secretive about its ranking algorithm, and Amazon tools are the only way you can get real data on what’s going on. And, frankly, if you want to grow your business, you need to start using FBA and Amazon Advertising and implement Amazon Prime to tap into this super-shopper pool.


6.  Not Constantly Improving Your Performance

Running a business is tiring. It’s easy to get lazy after the first stages when sales are coming in. It’s even easier to let go when sales keep coming in even after you’ve ignored your listings for a while. But this leads to two dangerous Amazon seller mistakes:  thinking you’ve got it down and thinking you don’t need to change things up.

It takes Amazon a while to crunch data, and it takes the competition a while to make changes on their end. If you aren’t vigilant, you’re going to get displaced, and it’s going to take you more time and effort to regain your previous position. Use the metrics that the marketplace provides to stay on top of everything so you never fall behind.


7.  Failing to Encourage Positive Customer Feedback

Again, there are two Amazon seller mistakes here. Your performance will take a hit if you aren’t getting positive feedback, of course. But you also need to get feedback – whether good or bad – for at least 2-5 percent of your total sales.

If you aren’t hitting the mark, you need to actively encourage feedback – and make an effort to ensure that it’s positive. You can use an automated tool to help you, but you should always work on developing a personal touch that really speaks to customers.

Monitor all the feedback coming in – ideally every day – so you can remove for poor ratings that don’t meet Amazon standards. If you’re using FBA, anything about fulfillment can be removed. Product reviews also don’t belong in the feedback section, so you can ask Seller Support to strike those off the list.

Make sure that you know the difference between negative feedback and inaccurate feedback. Feedback is about your performance as a seller, so if the rating applies to you, you can’t request it to be removed. Instead, work with the customer to resolve their concerns, then ask them to update their feedback once they’re satisfied.


8.  Keeping Things Too Local

Don’t ignore the international market if you see an opportunity to expand. Staying local may be more comfortable since you already understand the market. But you don’t want to lose out on billions of additional customers if you know you can serve them.


Your Listing


9.  Competing with Amazon

You can never win against Amazon, especially not on their own marketplace. They are the largest online retailer. You just can’t hope for a good outcome by going head-to-head with this giant. Even if they end up selling at a loss to stay on top, they will because they can afford it.

Before you even think about selling a product, make sure that Amazon isn’t selling the same items. Use a tool to help you check the trends, because you may not see it, buy inventory, then realize that Amazon was just out of stock at the time.


10. Not Investing in Quality Listings

You need to put conscious effort into your product listings. This means getting quality images and copy done so that you are putting your best foot forward. You want to make the best impression you can on customers to continually get the sale.

Your main product image needs to be a high-definition shot of the best angle of the product alone on a white background. Go with another neutral background color if your product is white. Add other angles of the product to help customers get a good overall look at it. Then add lifestyle shots to show them how it feels to use it.

Use the best keywords for your title and the second-best for the bullets. Use the remaining ones in the description, then enter the rest in the backend keywords field. Stay within the limits given for each area. Don’t use HTML code, URLs, all caps, symbols, promotional information or boastful adjectives. 


11. Selling Items that Don’t Match Product Listings

If you’re using existing product listings, make sure that your item is a perfect match. Almost isn’t good enough. Customers will complain if they don’t get exactly what they see on the listing, and Amazon doesn’t like that at all. If your product is in any way different from a current offer, you need to create your own listing.


12. Ignoring Pain Points

Amazon customers don’t shop for products – they shop for solutions to their problems. Everything you do to sell your product must, therefore, revolve around customers’ pain points. This is your starting point. This is where you get your keyword ideas and decide what images to upload, and how you organize your bullet points and write your description.


13. Underestimating Costs

Always study the basic Amazon fees so you can create a realistic budget for your Amazon store. You need to be able to project your long-term costs for things like storage, advertising, and customer service.

Fees are subject to change, so stay updated and recompute your budgets accordingly. They are also different across Amazon marketplaces, so you need a separate budget sheet for each area you sell in.


14. Entering Incorrect Inventory Quantities

As soon as you create or use an existing listing for your product, the inventory quantity and price is visible almost immediately.

If you indicate available inventory that you don’t actually have, you’ll get into trouble when you can’t ship it right away. Always type in the correct inventory quantity.

If you list at a low price and people start buying, you’ll either lose money or get into trouble when you have to cancel the orders. Overpricing is also dangerous – your listings can get blocked. Always type in the correct price.

You can use repricing software to help you stay competitive after the initial launch. They can bring prices down to attract customers so you don’t get undercut by competitors. They can also be set to control these adjustments so you don’t lose all your inventory at the sale price.


15. Forgetting Sales Tax

Sales tax has to be paid, and no one cares who pays it. You should fill out your tax settings as soon as you sign up for your Amazon account so it’s taken care of before you make any sales. Always add on the tax or you will end up paying a large liability. You can also use a tool or pay Amazon to collect tax on your orders. Don’t forget that you, the seller, are responsible for remitting sales tax payments, not Amazon.


16. Not Seeking Reviews

One of the top Amazon seller mistakes is leaving reviews to populate organically. Reviews are so important, but you won’t get many because most customers won’t take the time do leave one – or at least not a detailed one. They just want to get what they ordered, and when they’re happy, that’s the end of it. To make matters worse, they’re only interested in reviewing a product if they’re not satisfied, which means negative reviews.

The only way to get more positive reviews is to be proactive about them. Make sure from the very beginning that you are providing the best shopping experience possible. This ensures that most customers will be happy with their purchase. Those who aren’t will receive such stellar customer service that their frowns will turn into smiles so fast that they’ll forget their complaints and focus on how awesome you are. Then you have a field of happy customers who are ripe for the picking. Go after those positive reviews by asking politely and telling them how important their review is for other customers.


Your Inventory


17. Having a Slow-Moving Inventory

When you can’t sell inventory, your capital is tied up and you’re paying additional storage fees without money coming in. It’s never good to run out of stock, so you need to figure out a good level of inventory.

If you’re selling a new item, figure out a test level based on projected sales and turnaround time from your supplier. If you have real data on a current item, use it to compute how much inventory you need, considering how much time it takes from ordering it to having it available for purchase on Amazon.

If you already have excess inventory that’s not moving, you need to liquidate it, even at a loss, before you lose more from paying storage fees. There are several ways to do this. You can sell it elsewhere, sell it at a discount, bundle it, or move it to a place where you aren’t paying for warehousing.


18. Running Out of Inventory

You don’t just lose out on the sales for the days that you were out of stock. Customers will look for a more reliable seller. This means you can lose them forever. Develop a system for inventory management or use software to help you make sure you don’t run out of inventory and have the right stock levels at all times.


Fulfillment


19. Not Meeting Fulfillment Expectations

New Amazon seller mistakes often include late shipping, missing tracking information, and order cancelations. Using FBA easily eliminates these issues, but it may not be right for your business at this point.

If you are fulfilling items yourself, you need a system to make sure that orders are fulfilled perfectly. New sellers need a perfect record for at least the first ten orders. Always make sure that you can ship out in the timeframe you indicated. Always enter correct tracking information for each order on Amazon. And always make sure you have enough inventory to fulfill each order on time.


20. Pricing Shipping Too High

A lot of sellers lower product prices then make up for it by increasing shipping costs. This is an old trick that customers hate. It kills their excitement at finding a great deal. They have wasted their time on you and they feel cheated.

Make sure that you have a good base selling cost for starters – what you need to make a profit you’re happy with. This will help you to keep your shipping costs as reasonable as possible. Shipping at 20% of the item’s cost is too high. It turns customers off. If actual shipping is high, then add a portion of it onto your item’s price to balance it out.

Amazon customers prefer premium, free shipping, which is why the Prime program is so popular. If you can offer free shipping on merchant-fulfilled orders by computing it into your product pricing without jacking it up too high, then that’s great.


Customer Service


21. Not Putting the Customer First

It’s all about customer satisfaction on Amazon, so you must treat customers like royalty at all times. This starts with making sure that you are providing them with all the information they might want before they ask for it. This also reduces the number of inquiries you need to handle as well as the risk of slipping up.

Make sure that all the product details and store policies are clear, correct and readily available on your listings. Don’t try to mislead them or hide any details that will upset them later. Don’t say anything you can’t make good on, and always keep your word.

Sometimes customers will return perfectly good products, so you want to make sure that your returns policy covers all the bases while keeping customers happy.

When you do get complaints or negative feedback and reviews, never get upset or argue with customers. You will always lose, even if you’re right.


Don’t Interfere With Your Customer’s Opinion About Your Product!

Never try to bribe or otherwise incentivize customers to leave positive feedback or reviews. You won’t get away with it for long, and whatever it brings over the short-term will kill your business in the long run. Customers don’t like discounts or freebies with strings attached. They also quickly realize that the other positive reviews on your listing are probably bought and therefore fake. They will spread the word.

Always track customer interactions and use all the available data to continually improve their shopping experience.


22. Slow Response Times

Amazon expects you to respond to each customer inquiry within 24 hours. They don’t care about time zones and working days, or what the message is about. Figure out a way to monitor customer messages daily so you don’t risk account suspension for low Contact Response Time. You can use software or hire help – whatever suits you best.


Final Thoughts

Selling on Amazon may not be easy, but it’s easy to avoid these Amazon seller mistakes. Plan ahead using these tips so that you’re prepared to be the seller that Amazon loves to promote.

Whether you’re new to Amazon or a veteran seller, this list of Amazon seller mistakes is a great reference to keep you on your toes and hustling hard to be the best you can be. Don’t be one of the tens of thousands of sellers who fail on Amazon – many within six months – because of one of these avoidable Amazon seller mistakes.

Julia ValdezCostly New Amazon Seller Mistakes to Avoid
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