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A New Sellers Guide to Interpreting Amazon Sales Rank and Forecasting Demand

By Nate McCallister / a few months ago

"War is ninety percent information."

-Napoleon Bonaparte


Understanding Amazon sales rank will make or break your business. Too many sellers “think” they understand sales rank, but really only learn that they don’t after they stare at the same products that have been sitting in their inventory since the day they sent in their first shipment.

Failure to understand sales rank means:

  • You will tie up money in products that won’t sell.
  • You will lose money by pricing products incorrectly.
  • You will miss out on opportunities to buy the right amounts of products.
  • You will waste time on products you should have passed.

Failure to understand sales rank = Failure to run an efficient Amazon business.

The original title of this article was “The Ultimate Guide to Amazon Sales Rank.” I revised the title and the content accordingly, because frankly, you could write an entire book on sales rank. I want to give you the most important pieces of information now (my goal after all is max value, minimum time commitment on your end).

This article will go over the most important aspects of sales rank and will save you money, make you more money and save you a lot of headaches. And yes, that is a promise. These principles are that important.

If you want to earn EVERYTHING about sales rank, pricing strategy and demand forecasting, I highly recommend Stephen Smotherman’s book/web course “How to Keepa Camel."

DISCLAIMER

I am going to say a lot of things here that are based on “all things being equal.” In my economics courses throughout college, this was widely used, although they made it a bit more confusing by using the Latin phrase Ceteris paribus.

What this means: My statements are going to be made to simplify the description of outcomes. When I share this, you should assume that all other variables except those under immediate consideration are held constant.

There are so many different factors at play for each product and sale and to make my points, I can’t touch on each one. So, I isolate the concepts and discuss them under the assumption that only the factors I mention have changed.

For example, if I say something will sell less at $29.99 versus at $19.99, that is based on the basic assumption of supply and demand. Now, if there is a shortage or some sort of change in demand, this may not be true.

Understanding this will help not just in following this article, but also in your understanding of sales rank. There are always more factors that must be considered. I mention this in concept #1, Amazon sales rank is not “complete” information, but rather a part of a bigger picture. It can be used, but not in a vacuum.

What Is Sales Rank?

Sales rank is a reflection of “recency,” of sales, NOT a reflection of overall popularity.

For example, The Easy Bake Oven has sold over 30 million units since it’s release in 1963, but you won’t find it in the top 10 sales ranks in the Amazon toys and games category.

At the time of this post, Cards Against Humanity owns the #1 spot. It has certainly not sold 30 million units but it holds the #1 spot though because it is selling more recently.

Not everything that can be counted counts, and not everything that counts can be counted.
-ALBERT EINSTEIN,

How to read keepa graph

CamelCamelCamel (website and extension)

Similar to Keepa, CamelCamelCamel (just “camel” or “CCC” for short) is another free web based and chrome tool that lets your track price and sales history.

CCC Amazon

Jungle Scout Estimator (web tool)

To use this you need to enter an email address, but it is well worth it.

It is not a perfect tool (like I said, sales rank is not perfect and is relevant to many factors) but it does provide the most accurate estimates I have found.

Sales per category Amazon

FBAtoolkit.com (web tool)

When I started selling, I used this a lot.

Word started to spread that it was garbage and couldn’t be trusted. You can be the judge. I found it helpful, but like the estimator, it is not perfect.

Amazon Sales Rank Calculator

Flippin.It Pro (Chrome Extension) $9.99/month.

Flippin.It is a Google Chrome extension that puts the most critical sales history information right on the Amazon page.

You can see lowest, average and highest sales ranks and prices. Essentially, what you need to make a good buying decision is presented in this extension for you. Worth every penny.

Flippin.It Pro

Jungle Scout (web app and extension)

The extension is going to allow you to see estimated sales per month, average price and other valuable data from the Amazon website.

2016-12-16_16-59-19

The web app doesn’t require you to run from within the Amazon website and can provide you with valuable insight into products and estimated sales.

Tactical Arbitrage Variation Analyzer (paid web tool)

Tactical Arbitrage is a premium tool ($99/month, get a free 10 day trial with code ER10 at checkout) and all uses get access to the product variation analyzer.

This is great because it lets you analyze sales for products with variations (which can be more difficult to understand). The tool uses the number of reviews left for different sizes to show you what sizes and colors people are actually buying of certain items.

While this was once a standalone extension, the feature has been added directly to Tactical Arbitrage. You can now paste an ASIN and see which variations are actually ​selling. The data isn't perfect since it is based on product reviews, but it is still very helpful. On products with hundreds of reviews, the data is very reliable. 

Amazon product variations

In the example above, the size 11D(M) US shoes are selling the most (according to reviews) and 38.9% of all shoes sold under this ASIN are Black/Onyx/Charcoal.

You must approach products with variations carefully!​

Further Reading

As I said, theory on pricing and demand on Amazon can be discussed endlessly. Here are some additional articles I recommend for continued learning.

About the author

Nate McCallister

Nate is the founder and main contributor of EntreResource.com. He is a lifestyle entrepreneur who spends his time building businesses and raising his two kids Sawyer and Brooks with his beautiful wife Emily. His main interests include copywriting, economics and piano.

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