Selling Low ASP Products On Amazon: Risks, Rewards, And Strategic Fit

Selling products with a low Average Selling Price (ASP) on Amazon often seems like an easy way to boost traffic and increase sales volume. However, the slim margins and rising operational costs can make achieving profitability difficult. Recent market developments, such as Amazon’s introduction of Amazon Haul in the US, which focuses on items under $20, point to an industry-wide trend toward price-sensitive shoppers. Therefore, this shift raises an important question: are low ASP products a sustainable strategy for businesses?

Ultimately, the answer depends on strategic implementation. At Market Rocket, the firm has helped brands transform the challenges of low ASP into significant growth opportunities by utilising smart strategies tailored to their specific goals.

When Are Low ASP Products Viable?

Low ASP products can be a powerful driver of growth when aligned with the right approach:

• Volume-Driven Margins – Low ASP products can work if your product achieves high sales velocity, enabling you to offset thin margins with volume.

• Traffic Drivers – Use low-priced items to attract customers and increase traffic to your brand. These products can also funnel shoppers toward higher-margin items in your catalogue.

• Customer Acquisition – Affordable products often serve as an entry point for new customers, helping build trust and brand loyalty.

• Key Considerations for Selling Low ASP Products – To make low ASP products profitable, careful planning and optimisation are essential.

1. Factor in Amazon’s Fees

Amazon’s fees can quickly erode slim margins. To mitigate fulfilment expenses, explore using the Low Price FBA Rates for products priced below £10. However, brands must remain vigilant regarding referral fees and advertising costs. Therefore, it is imperative that every expenditure directly contributes to profitability.

2. Choose the Right Model

Seller Central is ideal for gaining control over pricing, bundling lower Average Selling Price (ASP) items, and ultimately boosting Average Order Value (AOV). In contrast, Vendor Central simplifies operations for extremely low priced items, making it the better choice where achieving high volume is crucial.

3. Maximise Advertising Efficiency

Targeted advertising can help shoppers discover and purchase items with a higher value, but running wide-ranging campaigns for products with a low price can quickly deplete an advertising budget. Therefore, focus on precision and a strong return on investment within the advertising strategy.

4. Is Selling Low ASP Products Right for You?

Low ASP products can succeed when integrated into a broader, strategic framework. Here’s how they can benefit your business:

5. Drive Customers to Higher-Value Items

Use low-priced products to create a funnel that leads customers to purchase complementary or premium offerings in your catalogue.

6. Attract New Customers

Affordable entry-level products can introduce new buyers to your brand, encouraging repeat purchases and customer loyalty.

7. Explore New Categories or Regions

Low ASP items can act as a low-risk testing ground for launching in new categories or geographic markets.

Why Choose Market Rocket?

At Market Rocket, the evaluation of whether low Average Selling Price (ASP) products align with a brand’s business goals is a key service. From optimising costs to developing effective advertising strategies, the company provides essential tools and insights. This enables businesses to make informed decisions and achieve sustainable growth within the Amazon marketplace.

Let Us Help:

• Assess the profitability of low ASP products.
• Optimise your pricing, fulfilment, and advertising strategies.
• Create a roadmap for maximising ROI with affordable products.

Want to see your Amazon performance skyrocket?  Book a call with our team or email us at amazon@marketrocket.co.uk to take your brand to the next level.