The key strategies for product selection can be summed up to commodity products and unique or special products. The product selection strength depends on sourcing, new products, and price control.
Product Selection has 3 important steps namely sourcing, new products, and price control.
This question is on every businessman’s mind, who wants to start an E-Commerce business.
If your product selection is not good, then your E-Commerce business can never become big.
Through this video, you will learn how to do product selection as well as how the customers choose these products. In some cases, to choose the right products to sell, there are some very complex tools, but these are very expensive and may not be valuable to you.
Key Note #1: Product Selection — Key Strategies
- Categorise Products in Two Parts:
Commodity: These products are often bought by people and they know about other similar products as well. For example, a water bottle. Everyone buys this and they know what kind of quality is available.
Unique/Special: These are unique and special products.
Biodegradable products. Utensils can be made out of these like plates, spoons, bowls, etc. These are special products and people know very little about them.
Commodity products have a very high demand because people already know about all these products and you just have to fulfill people’s demands for this. These kinds of products have a lot of competition because many companies are competing here and the price war is also very high.
Special Products have very few price wars. There are fewer brands and fewer customers as well, but the profit in these is very high.
So first, you must decide whether your product is a commodity or a special product.
- Online Purchase of Product:
The second thing that you must see is whether your customers buy your products online or not. If he buys them online, then how does he do it? Let’s take the above examples of the water bottle and bio-degradable products.
What do the customers buy? To research this, you can go to Amazon, Flipkart, and other big websites.
On the Amazon.in website, the moment you write a water bottle, Amazon gives you as much as 10 options to choose from. These options that you see are the ones that people are looking for. Amazon’s intelligent search engine, using data from people all over the world gives you the closest possible option.
This is for their benefit because they want you to get the right product that you want and to buy it immediately. These recommendations tell you that people are not just buying water bottles, but are also looking at all the possible options.
For example, a 1-liter Milton water bottle, Set of 6, and for kids.
All of this reveals that the customer wants to buy 6 sets of bottles.
Now, let’s search for bio-degradable plates. As soon as you enter this, you will get to know that people want to buy a pack of 100 bio-degradable plates, 10-inch and 12-inch plates as well. They want to buy a pack of plates and spoons along with this as well.
Through this example, you got to know that both these products are in demand and that the customer buys them online.
Key Note #2: Product Selection — Strength
This has 3 important steps:
Sourcing: Strength of sourcing.
New Products: Which means which category you can make them in.
Price Control: This is the most important.
It is not recommended for any businessman to sell a product in which your sourcing or development strength is not there. Sell only those products in which your strength lies.
If you don’t have a product, then you should see which product you know, or in which product you can do the sourcing. Your interest lies in developing which product?
Key Note #3: Product Selection — Interest
Let’s take an example of your interests:
You have developed these categories very well and made profits online as well. You started selling jewelry products, which took some time to master. So when you source your own products newly, it takes some time to develop them. It can take 4 years.
So, sell those products which you understand and put all your efforts into that. You can develop them and source them as well. Then only, will it give you a good and high profit?
Let’s revise all these learnings again:
- Identify your product category
- Identify purchasing platform and consumer buying behavior
- Identify the product’s strength and interest
Implement all these learnings to ensure a profitable E-commerce business.