When discovering product, we can quickly determine the market condition through some shortcuts and we also can conduct the first round of market screening. One of the most effective dimensions is “New Product Proportion”.
In general, the market with a large amount of new products is mainly divided into two types:
1. Markets like “Electronics” and “Clothing” that are iteratively updated
2. Emerging markets. Generally speaking, these two kinds of markets are relatively more open, and new sellers or brands can enter to occupy markets.
On the contrary, if there are few new products in the market, two possibilities exist: 1. Such a market is either aging or declining, with no new product willing to enter. 2. The product structure of the market is very stable, with long product life cycle and low update rate. In the recession market, sellers can indirectly search for new market potentials through studying the changing trends, and gaining insight into the transfer direction of consumer demand; However, if the stable market structure leads to fewer new products, such a market entry barrier is relatively higher.
The number of new products in a market is directly quantified through “New Product Proportion”: the proportion of new products can be divided into "new product quantity proportion" and "new product sales proportion".
“
First of all, we define the new product proportion as TOP100 (top 100 in sales) listings which were launched within 6 months of the subdivided category,
"New product quantity proportion" refers to the ratio of new products to the total number of products; "New product sales proportion" refers to the ratio of new products sales to the total monthly sales.
Why is the “New Product Proportion” decomposed into two concepts for analysis?
Because a market may have a large number of new products but a small sales of new products, or a small number of new products but a large sales of new products. Such market opportunities are different.
Why do we study the TOP100 data of the subdivided category?
In general, the top 100 data of the subdivided category reflects the most concentrated consumption data in this market, representing the epitome of a subdivided market. The epitome comparison of different markets will make our judgment of the key dimensions in different markets the most efficient. It is also a powerful tool for us to quickly find the most suitable category for operations.
Why do we define the new product as launched within 6 months?
The launch time of new products can be set by the seller according to your own target, which can be defined as 1 month or 3 months.
How to count “New Product Proportion”
Find new product launch time
For Amazon sellers, it is not possible to view the product launch time directly at “Product details”. If there is no market data analysis tool of Amazon, you can judge it by two methods: 1. Check the product's first review time to infer the launch time, as shown in the red box of the picture. But it is not accurate to predict the launch time from review, because there are many variables in it. 2. Check it directly through some paid extensions, such as Keepa.
Manual statistics: establish two EXCEL forms. The first one counts the launch time and sales of each product; the second one calculates the launch time by interval and counts corresponding proportion; and finally the column + line compound chart is generated for intuitively judge .
How to analyze “New Product Proportion”
When researching the proportion of new products, we should pay more attention to analyzing and comparing the new products proportion in different markets. The manual statistics are very time-consuming, because one dimension of a market needs to be counted for several hours. It assumes that we also want to analyze multiple dimensions of multiple markets, the statistical work will be very large. Many sellers now choose big data tools to help improve the efficiency of product selection.
For example, in SellerSprite - Market Research, it takes only one minute to sort descending with “New Product Proportion (refers to new product quantity)” of all categories in Amazon, and quickly find the market with high new product proportion in Amazon. As shown below, we found a market with 29621 market capacity, new products which were launched in the past six months accounted for 45.83%, and new products sales accounted for 33.75%.
Market Research:
BSR Page:
Launch Time:
From the launch time, we can see that there 11 products which were launched in the last 6 months, accounting for 46.8% of sales. New products in the market perform well. For new sellers, although we want to enter a market with a relatively high proportion of new products, the higher the proportion, the more opportunities for new products in the market; It may also mean that the product update iteration is too fast and the life cycle is not long. As shown above, electronic products or some seasonal products.
At this time, we need to judge more market data according to our own conditions. For example, we continue to check the average reviews of the new products in SellerSprite, and judge whether we have the same resources to create the same number of reviews. Of course, for a market, SellerSprite has more than 20 data dimensions to help sellers fully understand and analyze the market situation.
The picture below shows the subdivided market “Aquarium Sands” with low new products proportion, which was screened in SellerSprite - Market Research with “New Product Proportion”.
It can be seen that sales histogram is mainly distributed on the right side, and the number of new products and sales of [1-6 months] on the left side are few. Products like “aquarium sands” have less innovation, long life cycle, and stable market. There are only 3 new products which were launched in the past six months, with sales accounting for 1.15%. Such a market has few entry opportunities for sellers.