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Should I start selling on amazon.com or .co.uk?

A lot of EU-based potential sellers always start out with this question, as since I work on both, I thought I would share my thoughts.

 

Pros of amazon.co.uk

 

Pro 1: Feels 'safer'

 

If you are EU-based, the obvious perk of starting on UK Amazon is that it just feels simpler and a bit less daunting, after all, you are on home turf, literally. You know how taxes work, at least on a basic level, and you are getting paid in pounds or Euros.

 

The thought of starting on .com can seem more complex as you might not have a USD account, US address  or understand your tax obligations (FYI most US sellers and tax specialists are divided on the whole multiple nexus and sales tax issue – legislation just hasn’t caught up with this model). Each will proclaim they are right with equal force.

 

When learning about FBA and starting from scratch, this is another layer of learning that makes most people think, ‘I’ll start with UK and expand to the US’. That’s what I did myself.

 

Pro 2: Less competition

 

The UK and EU marketplaces are much, much less competitive than the US. You can still launch unbranded products in categories like mobile accessories and still be successful. You can potentially make an impact with the kind of products that have long been over saturated on the US market.

 

It also makes it easier as the barrier to entry is just lower in general which is important when you just start selling and are learning the ropes, refining your strategy.  

 

Pro 3: You get access to all the other EU marketplaces

 

Your Amazon UK account lets you sync your FBA items to all the EU market places at no extra cost. There’s also an option that makes your items eligible for delivery in literally 20+ EU countries.

So for example, someone in Bulgaria, looking at amazon.co.uk can order any of my items and Amazon will take care of the rest.

 

Just make sure you have good translation of your listings ready

 

 

Pro 4: PPC and ACOS are much lower

 

For 90% of items, your ppc costs will be a fraction of what they would be in the US because there is less competition driving up costs. You probably won’t even be able to max out your daily spend, unless you’re selling supplements or something.


Cons of amazon.co.uk

 

Con 1: Less competition but less money

 

Depth is a huge problem on the EU marketplaces.

The US market us so deep that you can find ‘good’ depth in almost any market niece - you could probably make decent money of selling special baseball caps for micro pigs or something ridiculous.

 With the UK market and EU in general, you have to do a lot more digging to find something with a number spread that looks good enough – and even then, it’s hit and miss.

 

I touched on this aspect a little in this article

 

Long story short, getting a 20+ per day product out of the gate is just much harder. A better strategy for the UK is multiple products doing 5+ sales per day. But diversifying to multiple products is a good idea, whatever the marketplace.

 

Con 2: The other EU markets are mostly terrible

 

Sure, it’s all one big EU love fest, but in reality, apart from Germany, the other EU marketplaces are way, way behind for the most part.

 

For me recently in fact, de has actually been better than UK, pulling in 10+ most days, but, that has more to do with a hijacker and a supplier undercutting my price on amazon.co.uk by £3 – ouch. This has tanked sales for my main item and its variations, so I have to account for that.

 

In the meantime, here’s a quick comparison between Germany and France

 

 

 

And Italy and Spain are about the same – damn you Spain!

 

So yes, while there is opportunity there, don’t expect huge influxes of Euros.

 

For most US sellers looking to expand, please also keep in mind that you probably won’t be getting half of your US volume AND you’ll have to pay 20% VAT AND the tax side of trading in the UK and EU will be a lot so it may not be worth it.

 

Con 3: Your EU PPC may be terrible

 

As you may know, getting good impressions for your PPC depends on you having good, relevant keywords, properly seeded and implemented. This can be a problem when you translate your listings.

 

With the EU listings, most people have bad translations and, missing potential keywords and as a result, the impressions are very low. To combat this, you need a localised translation meaning the text should read so that a native can’t tell it’s a translation.

Your translator also needs to include all the different possibilities for your main seed keyword that you may otherwise miss. There may be a weird colloquialism for your product that only native speakers know about (and search for when buying).

 

I used to work as a professional translator so I’m kind of anal on this stuff. Still, in any case, please never use Google translate for your EU listings, it will suck and you will be the Borat of private label!

 

Pros of amazon.com

 

Pro 1: Crazy depth

 

As I mentioned above, the depth to the US market is insane and ordering stuff from Amazon is so ingrained in US buyers that South Park even did a hilarious episode on it.

 

Not only that, any seller tool or service that comes out is always geared to the US, at least initially. A whole cottage industry has arisen around selling on amazon.com. I even (SHAMELESS PLUG ALERT) wrote a 30+ page Ebook reviewing all the current software and tools available.

 

With so much depth, finding potential products in all kinds of niches is a piece of cake.

 

Pro 2: PPC can be a money hose

 

For most products, turning on PPC can be like turning on the money hose. You can spend tons, drive mad impressions and, hopefully, get a good acos. It all depends on products of course and proper listing setup but here’s one image from a campaign I did and this was the result after 3 days:

 

 

Pro 3: It’s quite easy to start selling on .com, even if you aren’t from the US

The endless debate back and forth on nexuses and sales tax aside, it’s super easy to sign up and start selling on amazon.com.

 

If you’re from the UK, you can start selling with just your UK bank account and address and contact details. If you’re from a country that makes it a bit harder, like Brazil or Russia, you can just get a virtual address and use Payoneer of WorldFirst for a USD account.      

 

Cons of amazon.com

 

Con 1: Hardcore competition

 

As FBA selling has spiralled into a huge gold rush, people from all over the world are starting to sell similar PL items on amazon.com using the same research techniques, software, criteria and supplier platforms.

 

So not only is there a lot more competition for similar items, the completion is also much more ruthless using dirty hijacking tricks, 1 star review up voting and click fraud and more.

 

 

With more money to be made, people are becoming more cutthroat.

 

Con 2: You have to have a higher level of sophistication right off the bat

 

While there is still a wealth of opportunity out there, I feel that, especially as of 2016, you need to bring a more unique package to the table – more creative, better, differentiated branding, bundling of products and more.

 

If you are selling a salt shaker, you better have some kind of USP to stand out in the images or the PPC, or you’re asking for trouble. I worked on some PPC for a nice couple selling a pepper grinder and it wasn’t pretty!

 

So don’t just try and sell a yoga mat, sell a yoga starter set- even if it’s more work and involves multiple suppliers. The harder you are to copy, the easier life will be later on.

 

Why I list this as a con is because, when starting, you probably already feel swamped enough with so much new info to synthesize and now you need to start thinking about advanced bundling, branding and hijacker protection! It’s a lot to take in.

 

Con 3: PPC can spiral out of control

 

 

Dirty competition tricks aside like PPC click fraud, when a listing isn’t set up properly, PPC spends can go wild with terrible conversions and really bad ACOS.

Also, with more and more sellers with similar items driving up the cost per click, for some items, PPC is almost unprofitable.

 

 

 

It’s like Google ads – they used to cheap and super effective but now, when the cost per click is $2, the guys with the deeper pockets win and smaller players get shut out.

Sure, facebook ads and Pinterest are still underutilised right now by PL sellers, but it’s just a matter of time.  

 

My Verdict

 

If I were doing things again, I think I would start out with amazon.com because, despite the vast competition, the potential there is so huge.

 

The low volume on Amazon UK quite often proves frustrating as getting a real 20+ per day product is, I feel, a lot harder. It’s safer and less brutal and can be a goldmine for some, but generally, safer isn’t always better.

 

It’s still a good sales channel and I’ll continue to launch products there, but a focus on interesting offers in the US will be getting more of my attention going forward.

Finally, even if you do start on UK, you can always expand to .com and vice versa, you’re not locked in forever!

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