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There are many ways to make money on Amazon. You can join the Mechanical Turk marketplace and get paid to do virtual tasks, publish an e-book or a printed book through Kindle Direct Publishing. Or you may be able to deliver items through Amazon Flex, if the program is available where you live.
But Amazon's status as the top-selling online retailer makes two money-making opportunities stand out from the rest:
Joining Amazon Associates, the company’s affiliate marketing program.
Selling stuff through the company's e-commerce platform.
Here’s what you need to know about both options.
Participants link to Amazon products on their blog or social media channel and get a commission based on subsequent sales. Amazon Associates is best for influencers who already promote products.
Affiliates earn a commission when a visitor to their website clicks a link to an Amazon product and buys it. The visitor must purchase an item within 24 hours or add an item to their cart and purchase it within 89 days. Commissions are typically 1% to 10% of the purchase price, minus shipping, taxes and fees.
» MORE: How to make money on Instagram
To get started in the Amazon Associates program, you’ll need to have a website that meets Amazon’s site requirements. Next, submit an application. If it's accepted, Amazon requires you to place its affiliate disclosure on your site. The Federal Trade Commission also requires affiliate marketers to clearly disclose their relationship with retailers in posts containing affiliate links. That means affiliates should make all disclaimers easy for readers to find.
Affiliate marketing is usually the best way to make money on Amazon. That's because you’ll have a built-in pool of potential customers who trust your judgment and will be more likely to buy products you recommend.
Your success as an affiliate depends on tailoring products to your audience. Start by thinking about your audience’s needs and why people follow you. Or go straight to the source by sending a poll or email asking what kinds of products to include on your site. Then spell out the relevant details in your posts.
Say you run a nature-photography blog for beginners. If you’re linking to a $65 aluminum tripod, you might add, “It’s lightweight and compact, so it’s a good option for hikers. I brought it on my three-day trek through Yosemite and it held up well in rough weather.”
» MORE: How to make money blogging
Once you get affiliate links up on your site, focus on getting more traffic to those links to increase your chances of earning money. Frequently publishing content, such as blog or Instagram posts, can help engage existing followers. And it may help your site show up in search engine results, thereby attracting new readers.
To add more affiliate links to your site, consider building a product page that lets you list multiple links. That also gives readers easy access to the items you recommend.
Or you might start a series of weekly or seasonal posts in which you review products. It’s also good to experiment with Amazon’s link, button and banner options, which can help highlight the products you recommend.
Track your site’s traffic with a tool like Google Analytics and use Amazon’s affiliate reports. They will help determine if your tactics work or if it’s time to change your approach.
Those looking to start an online business can make money selling on Amazon. It takes an entrepreneurial mind and significant effort to get off the ground. But with the right product, the potential payoff can outweigh the risks.
Before you start selling on Amazon, pick a profitable product. To do that, you’ll need to consider the selling costs, such as manufacturing and site fees.
First, check if you’re eligible to sell in your chosen category. Some products, such as auto parts and watches, require Amazon’s approval before you can list them. Then determine how much it will cost to get your product in customers’ hands. That includes everything from materials and labor to packing, labeling and shipping.
You may outsource the shipping, storage and customer service by participating in the Fulfillment by Amazon program. But that will cost you, so weigh the options carefully.
» MORE: Where to sell stuff online
Amazon’s fee structure depends on the type of seller: individual or professional.
Individuals pay 99 cents, plus a referral fee based on the product category, for each item sold. Those selling media goods, such as books, DVDs and video games, also pay variable closing fees for each item sold. Amazon’s shipping rates apply to all individuals’ sales.
Professionals pay a $39.99 monthly subscription, a per-item referral fee — which varies by product — and closing fees on media items. For these sellers, the site’s shipping rates apply only to media items.
They also have access to more product categories than individuals, can offer special promotions, and are eligible for top placement on product detail pages. Amazon recommends the subscription program for those planning to sell more than 40 items a month.
As an individual or professional seller, you’ll likely have to satisfy Amazon’s so-called A-to-z Guarantee. That means you could be on the hook for refunds, including shipping charges, if a customer isn’t satisfied.
So build some financial breathing room into your business plan. Another important consideration is taxes. As a seller, you’re considered self-employed. So even though Amazon generally calculates the sales tax on items, you’ll likely have to set aside more money to pay estimated quarterly taxes on your income.
Once you know all the costs involved, research prices for similar items. That will help you price items competitively.
To maximize your earnings, consider finding a cheaper supplier to save on production costs or using search-engine optimization tactics, such as using relevant search terms throughout your posts, to reach new customers.
If Amazon isn’t a fit, consider these other sites for some extra income:
Learn about making money on Etsy.
Look into how to make money on Ebay.
Explore how to make money on YouTube.
Or discover how to sell clothes online.
About the author: Devon Delfino is a former personal finance writer for NerdWallet. Her work has been featured by the Los Angeles Times, MarketWatch and Business Insider. Read more
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