The Simple 5-Phase Process to Find Products for Online Business
Thinking about starting an eCommerce business to introduce and sell products to potential customers? And wonder what online selling products are the best selling? In 2019, online business competition is predicted to be more intense than ever. There are over 12 million products being sold right now on Amazon solely, with 310 million active users (or sellers).
If you immediately jump in and sell an I-think-it-has-potential product or even gather money to open a Shopify store without experiencing any online business, you are leading yourself to certain failure. Choosing a suitable selling product is the first prerequisite you need to do in order to stand out and survive in the eCommerce world.
This article outlines a simple step-by-step process to help you identify opportunities in selecting the best products to sell online, with additional information about trends and suppliers that will help you conquer your entrepreneur road. Let’s get right into it!
- What Makes a Great Product?
- 5-phase Process to Find Products
- Bonus: Some trending products with high profit in 2019
- Final words
What Makes a Great Product?
With millions of choices to choose from, you would want to limit yourself to a few products that truly fit with yourself and have great potential. How would they look like, you may ask? Let’s take a look at these next important attributes to know more.
1. Solve a problem
This is important to give your product a sole purpose, the ultimate “why” that a buyer should spend their money to purchase it. Ask yourself some questions: What are some everyday life problems that you have yet to see a noticeable solution?? What can actually help and make people problems go away? What can you do to bring it to the ones in need? If you can answer these, you have found a product that people would want to buy.
2. Spark feelings
Let’s be real, it is not just about the price or brand that makes you buy something, you purchase because you want the feeling after owning the item. So profitable products are the ones that people have strong emotions about or even passion. This gets people curiosity, talking, and buying, but be careful as hate emotion can do the same but doesn’t have a good lasting effect.
3. Great branding potential
It is important to remember that you always should aim your business for the long run. And the products are the front face that represents why you started in the first place. Your brand name, your logo are all affected by this. So you should choose products with lots of potentials to boost your brand, through images, videos, or social content that can be shared, retweeted or even go viral.
Having a product that can do everything sounds cool, but most of the time, the million-dollar idea comes from something that has a very specific purpose and solves a very well-known problem. This can be called a niche product, which is suitable for a certain group of buyers. This leads to uniqueness, even in just small details like a color pattern or different features from existing competitors. This makes your product stand out and able to hone into customers’ minds.
Further Reading: How To Find A Profitable Niche For Dropshipping
5-phase Process to Find Products
1. Evaluation Phase
You knew what to look at to find products for your eCommerce, now you need to evaluate both internal and external of your business. These two factors co-exist with the pros and cons that require you as an owner to use and solve in order to move on. We are going to use a classic system called SWOT (Strengths - Weaknesses - Opportunities - Threats) to have a full picture of many sides of your online store.
This is the first thing you need to address with yourself or your team, be self-centric and truthful about your competencies:
What are you passionate about? What always comes to your mind all day? What makes your heart excited just by thinking about it? Follow your heart and say it out loud. This can be the energy for you to create the best product ever.
What is your expertise? Things that you have been doing your whole life and can do properly with a blindfold? This brings confidence since it is what you make people remember about. Get this, it is the thing you think you can be the best of them all, not just good at.
What are your advantages? This, in a nutshell, is what makes you unique among the rest of your competitors. Is there something that can not be found anywhere else? In this modern world, that is something hard to find, so make sure you understand what you are talking about and it won’ t be able to be duplicated in the long run.
Now, this is not meant to bring disappointments, it is to gain insights and truths that you should know about your business, and find the way so they can be resolved through time.
What can you improve? The skills, the knowledge, the budget, what would you wish you had acquired earlier and is there an opportunity to breakthrough? Online business is no overnight success, so if you constantly become better, you are ahead of many competitors.
What do you dislike? Strangely, this can bring unexpected ideas about what product you should find. You find a way and start building solutions to the thing that you hate to do. Like if you don’t want to catch a taxi every time cause they are so slow, you invent Uber so strangers nearby can pick you up right the way.
Now we focus on the things outside that you can’t control. No business grows fast without a bit of luck from the market. This will even help you to predict the future and have a more suitable direction. What do people search for? Keyword searches are what will help you find out what your audience is actually looking for. By analyzing and research, you can find product ideas that many are looking for but yet to receive a solution.
What is trending now? Now you may have to ask your little brother for this, but keep an open mind. Trends are super exploitable if you want to make your product more eye-catching, and trend fades fast too. You can have some improvement ideas from them as well.
What are the gaps in the market? At this stage, try to evaluate the unavailability of a product. It can be the lack of quantity or certain features that you think why are they not there yet. This gives you a picture of what the market needs to be filled up.
Another thing that you can not control is the potential risk that your business may have to face. This sounds hopeless, but if you can manage your own resources and talent, you may actually find a positive way to fight back.
Is there a lack of supplements? This presents when the supply of a product is limited but the demand for the product is still high. Because of the scarcity, you may find new options for customers or your own business, and the competition in the filed may be easier.
Is the craze wave about to crash? You’ve seen it before, some product becomes worldwide famous overnight, make billions of dollars, then vanish quickly when nobody wants them anymore. This can give you a head-up in the future, and studying why they caused such a buzz can bring more ideas for your own product.
How big is the slice of the cake? Big corporations usually take a big bite on the market, leaving small and medium businesses with little to work on and compete. However, this again presents an opportunity since you can ask yourself: Why they didn’t buy products from those big companies? Evaluate the reasons and make a product that can solve the issues.
2. Strategy Phase
Now that you have finished the evaluation phase with the SWOT technique, it is time to have some strategy on how to get from not having anything to sell to have the best product in the world. This phase gives you some right ideas about knowing what you want to sell, and inspiration to keep going on.
Find Product Ideas
List down all the highlights of your evaluation phase: Strength - Weakness - Opportunity - Threats. These can give you an environmental feel on what you are looking for at a product. Keep that in mind since on the next step, you are going through hundreds of online items and only a few can meet your criteria. You should make a file to keep all the info you are going to get as well.
Where to Look for Profitable Products
Having a brief evaluation in hand, it is time to find your most profitable products. They can come from anywhere, but the importance is to give them actionable data that will help you decide on later. You should make a list of noticeable products of about 10 - 20 items.
A. Online Stores Sales Data:
One of the ways to find profitable products is by analyzing the sales data of some of the biggest global eCommerce sites. The idea here is you can gain product ideas based on these sites’ best-sellers, trending items, and the least selling products to understand your final selection of product ideas.
Amazon: Amazon is easily the biggest eCommerce market in the world. It has also become a standard for global online stores, having some of the most profitable products online. Therefore, Amazon’s sales data can bring a realistic view of the demands on online market.
eBay: Like Amazon, eBay is a multinational eCommerce company for online sellers worldwide. Therefore, it is a great start to find products to sell online, especially if you are thinking global.
Etsy: Etsy is an eCommerce website for handmade and vintage merchandises, as well as suppliers. This is where you find one-of-a-kind or uncommon items.
Alibaba: Alibaba is a giant Chinese eCommerce business that serves as a sales service portal for many sellers worldwide. With 674 million active customers each month (2019), there is a lot of information for you here.
B. Online Trendspotting Sites:
Trendspotting is a marketing intelligence tool used to analyze the interest of online consumers by closely tracking their activities like the number of times some keywords have been searched, tweeted, blogged or shared.
Trend Hunter: They claim to be the number one in trendspotting and has a large collection of fresh ideas from 195,000 influencers worldwide. You will find trend reports and product innovation ideas from many companies around the world.
Trends-spotting Market Research: The company offers customized trend research reports and innovation consultations through selected key industry trends and current market analysis.
Springwise: They are a worldwide source for business intelligence and deliver the most up to date trends and insights. The technology trends that they can cover are awesome.
TrendWatching: This is a famous trendspotting site has a global network of 950+ professionals in around 50 countries. They can help many companies understand new customers and find innovative products
C. Business and Product Review Sites:
Consumer and product review sites are also helpful to find inspiration for a new product. Depending on what industry you want to have idea, there are many sites that collect reviews from a variety of online consumers, and their opinions are really insightful.
Yelp: Yelp collects consumer reviews for restaurants, services, shopping and mostly all business establishments worldwide.
Tripadvisor: They are a travel companion site that allows people to book hotels and flights online. The site has been famous globally and also has a massive collection of customer reviews on restaurants, hotels, and other business establishments.
ConsumerReports: ConsumerReports showcases all the new tests of products. They are an independent testing company that can provide product recommendations and product ratings.
D. Social Media Sites:
Social media sites are the most convenient place to understand relevant behavior, different interests, opinions, and reviews that can provide a creative and innovative product idea to sell online.
Instagram: In recent years, Instagram has become famous for many entrepreneurs (Kydall Jenner for such) to engage with their potential customers.This is the place to get a dose of creative business globally, then Instagram is the site with fresh content and gorgeous images. You can find those global products and turn them into a potential local offering too.
Pinterest: Pinterest’s tagline is “The world’s catalog of ideas”. And with that, it is rightful for you to check the site for inspiration that could turn into a million-dollar idea.
Facebook: With Facebook Communities more and more thriving, you sure can find mind-alike on Facebook to search for new product ideas together, and even find places to promote your business later.
E. Local Communities:
Look far, look close, look right around your backyard. Traditional stores around your local neighborhood could be having an online store success thanks to their originality. Find what your local community is raving about. Go to the parks or visit the community to find the products that could be best-seller worthy.
3. Selection Phase
This is where your decision takes place. From the data you have gathered, you are now ready to shortlist product ideas and choose the most suitable ones for your eCommerce business.
Choosing Key Areas
What are the things that you absolutely need your products to be in the first place? The affordable cost, the quick revenue, the storage easiness, anything you think they are vital to your business through the result of the evaluation phase. Write these down, and keep it by your side when you go to the next step of comparing all the ideas.
Compare Your Product Ideas
Remember the 10 - 20 items that you wrote down in the second phase, this is where you can trim them down, based on key areas and possibility. We will walk you through the most useful tool to use and efficiently filter your list: Google Trend.
Google Trend is a platform to display the frequency of a certain search term relative to the search volumes. It gives you a visual presentation of search volume through time in each specific location. You can select up to 5 products to compare at a time.
Here we will provide you an example of a comparison between some famous shoe brands. Firstly, customize your selection based on Country, Time Range, Category, Source to meet your demand. Then, focus on analyzing these factors:
Interest Over Time
Just like the definition below, this graph shows the popularity of searches. As you can see, Nike Shoes take the top spot with the highest point.
Interest by Region
Here you can see the interest in each search in each region. We are looking at the USA map, and when you hover your mouse at a state, you can see how well each search phrase is doing there.
Each search term has an in-depth analytics for you to narrow down your product ideas, and see some related keywords that can be really helpful.
And when you choose Rising instead of Top, you can see which search terms are getting more interested these days, that is your trend right there.
Click on each related keyword, you can see more information about them. Like here, I can see Adidas game of thrones running shoes made an outbreak of search when the show was about to end. This way you can predict some events in the future to make actions.
Select Your Top Products and Evaluate
This is where you are finally ready to evaluate your top products and shortlist them into profitable ones. You will go through varies of different questions to answer which suit you the most.
Answer these questions:
How much demand is there in my target community? If there is none, is there any nearby region that has demand?
How big is my potential market size? You can use Google Trends to evaluate this.
Now, you need to understand how your competitors look like:
Search your potential products, what online companies are offering them?
How many of them are eCommerce? How many are traditional stores?
How long have they been in business?
Do they have other product offerings?
Are they a big corporation, partnership or small and medium business?
Do they have other locations to sell?
Your expenses will decide how you start your business very much, so try to get it right down to numbers. This affects your selling price, profit, and return on investment.
Based on your cost, you need to determine how much you want to sell your products online.
Make a submission form to ask people how much they are willing to pay for your products.
Check your competitor prices, how well they are selling them with the price compared to the business size.
Determine what your products should look like and have what advantages:
What can make your product stand out from the competition?
Is your product durable, perishable or consumable?
How about the size, weight or shape?
What is your primary and secondary packaging?
How will your product benefits customers?
After all these questions, you should be able to see which products have the highest potential and suit your internal as well as external abilities. From this, we can start making real actions on developing products for your business.
4. Implementation Phase
Having product ideas is just a small step in actually deploying your online business. In this phase, you will make your decisions come true by a concrete plan.
How to acquire your product
This is actually a not so easy task, especially if you don’t have a lot of budgets. You need to make a lot of decisions like what to buy, when to buy, how much, what materials, should you buy in retail or wholesale. Below are 4 most common methods to acquire your products and you should see which suits you the most.
This means you will make the product yourself. This requires much time and effort, but the result can be really unique and self-praising. There are many one-of-a-kinds store on Etsy so you can get inspiration. You will need a way to get raw materials though.
If you choose this method, you need to get a business partner who will produce the product exclusively for you. This can mean more budget and you usually need to have a minimum quantity to start working with your manufacturer.
This means you will purchase the product from another vendor and resell it. This reduces your originality, but famous brands can help build more trust from customers at first.
Quite famous these days, when you dropship, you don’t keep goods in stock but transfers customer orders and shipment details to third party vendors that ship the orders directly to buyers. Alibaba is a really famous platform to start with dropshipping.
How to locate a supplier
By making this far, you are really close. Now you need to locate a supplier who can provide what you need: your products.
Domestic vs. Overseas Sourcing:
Domestic Sourcing means the delivery or manufacturing of products is contracted within the buyer’s physical location.
Benefits of Domestic Sourcing
Faster delivery times and also lower costs.
Easier for you to quality check, inspection, management, and planning as well.
Make brand’s image better by investing in the local community.
Disadvantages of Domestic Sourcing
- Easier to encourage potential local competition
Overseas Sourcing happens when your delivery or manufacturing happens abroad from your country.
Benefits of Domestic Sourcing
Using resources that are not present in the local country.
Finding more alternative choices for suppliers.
Taking advantage of a more cost-effective supply chain.
Disadvantages of Domestic Sourcing
The difference between time zones and languages can make an increase in costs
Political and financial risks threaten by political differences.
Where to search for suppliers:
Online Searches: The internet can provide a wide range of suppliers just at your fingertips. Plus, a supplier good online presence is a good sign for your online store..
Local Business: Local business information including business phone numbers and addresses can be easily found online or through a telecom company.
Newspaper: Some business suppliers can be found in your local newspapers.
Referrals, Social and Local Networking: Ask your family, friends, and office mates for some referrals. Join social media groups and attend local trade events is also good means to find legit suppliers.
Closing deals with suppliers
You should always ask for a Request for Quotation, often called RFQ, which is a typical business procedure that serves as an invitation so suppliers can bid on particular products or services. The RFQ has to contain all relevant elements of the intended purchase, such as:
Price per item or per unit of service
Quantities/Volumes/Minimum Order Values
Terms and condition
Based on mutual understanding and goals of both sides, this RFQ should represent the relationship between parties and prevent the possibility of fraud or dishonesty.
Further Reading: A Comprehensive Guide on How to Find a Supplier on Alibaba
5. Choose Wisely
Starting an eCommerce business is not an easy task, and finding the right product isn’t either. Everyone must go through the 5 phases above to decide which suit best for them before eventually start the store. But the good news is you have a vast sea of products to choose and with the right strategy, you can find the opportunity with the most suitable ones.
To help you some more, we have gathered some interesting items with a high profit for you to consider.
Bonus: Some trending products with high profit in 2019
In 2019, smartwatches continue trending upward with more features rolling in, and prices keep getting better for customers. There are now more options to choose than ever, and you have more opportunities to sell than ever. From high-end to low prices, you can get providers on any level. And with exercising still being a high priority in human life, this trend is not going to fade away soon.
The posture corrector helps the users able to stand tall and straight while correcting their spinal cord. The product is widely recommended by many physiotherapists. People have really started to care more about their posture recently. This has given the product a higher possible profit because more people are now searching for it on search engines.
Car Phone Holder
Technology has made people live a lot easier. Before we had to ask others for directions, now our smartphone can tell us. But how to use a smartphone while in a car to look for directions? That’s where car phone holders come in. These have become an important car accessory and been in the market for a few years now. Whether you are a general store or a car-centric store, the car phone holder can easily get more orders.
Your eCommerce journey starts here, with the great products that you are willing to provide for prospects. They will not only suit your ability but fit into a buyer’s life and needs. You can find them as long as you follow the 5-phase process in this article, and of course, have the courage to begin the online journey.
This is just the first step, but it can take you a thousand miles. Leave us comments below on which product you have chosen, and how well they have been doing. We will always be ready to answer any questions.