I recently read an interesting post on Reddit about someone’s failed experience trying to sell gaming mouse pads online. It interested me, because one of the products I sell on Amazon happens to be a gaming mouse pad. Here is my story about how I became an accidental mouse pad seller.
For my Amazon business, I mostly re-sell products I buy wholesale. However, one of my goals last year was to experiment with selling a “private label” product. For those who may not know, selling a “private label” product means having a product manufactured by someone else, and then selling it under your own brand name.
The Experimental Purchase of an FBA Business
After doing some research, I decided I would rather purchase someone else’s existing product and brand, rather than starting from scratch, because it seemed less risky, as I’ve never designed a product before.
I poked around the Interwebs a bit, and I found an Amazon FBA listing on Flippa for a gaming mouse pad business for sale. I made a test buy of the pad from Amazon, and used it myself for a few days, and it seemed like a good product. Most importantly, there had clearly been a lot of work put into the design. The Amazon listing was also well presented, with good description and images.
However, there was no advertising being done at all, which meant the product had no reviews. This translated into only 1 sale a month for the original owner, which is a very slow rate of sell-through for Amazon FBA.
They were also getting killed on FBA storage costs, because they had sent 500 units into FBA all at once, which is a common mistake for someone just starting out.
I decided to take a chance and buy the business, partly because of the quality of the product, and also because I got a good deal, paying less than $1k for almost 500 mouse pads. That’s about 50% of the cost of having them produced by a manufacturer on Alibaba, so I was already starting out in a good place.
After the sale closed, I had all the mouse pads shipped directly to my house (to avoid long-term storage fees), then I sent 30 of them to FBA, and started running automatically-targeted ads. Automatically-targeted ads are expensive, because they target a large range of keywords. However, once you generate some data from running auto-targeted ads, you can use that data to create a manually-targeted campaign to focus only on keywords that have a high conversion rate, and greatly reduce your ad spending.
The Result: Buying a Mouse Pad FBA Business was Worth It
The ads were an investment that paid off, because after about 10 months, there are 17 total reviews, with an average of 4.9 out of 5 star rating. Important to mention is I didn’t ask any anyone to review the product, so these reviews are all “organic”.
Because of those 17 positive reviews, I now have a product selling once per day, rather than selling once per month. That may not sound like a big deal, but from my initial investment of less than $1k, I have a product that is making around $100 to $120 per month, every month, and rising.
Here are the points that are important to learn from my experience:
- Knowledge: The guy I bought this product from obviously did his homework on the product design (see organic 4.9 average rating), but didn’t know how important advertising was for generating reviews. He was 90% of the way to success, but didn’t have all the knowledge necessary to successfully sell a product on Amazon.
- Cost Control: When first starting to sell a product with Amazon FBA, cost control is key. Getting killed on long-term storage fees because you sent in too many units, or paying for sky-high auto-targeted Amazon ads month after month, are rookie mistakes. Amazon FBA is a volume game, and you need to capture every bit of margin you can get.
- Limited Risk: By getting such a good deal for the mouse pads up-front, I limited my downside risk to my initial $1k investment. In other words, by purposefully purchasing a product at a big discount, this experiment was low-risk to begin with.
Leave a comment and let me know what you think of my experience.