Everyday, I hear from Profit Bandit users who are confused by Sales Rank. Today is the first in a series of posts on Sales Rank and we’re going to start with the 5 most important things that you need to know about Amazon Sales Rank.

 

1. Sales Rank Changes Over Time

We’ve talked about this before, but in the absence of sales, an item’s Sales Rank gets worse. Take a look at this screenshot from CamelCamelCamel.

Note how the sales rank slowly degrades until a sale is made and the rank shoots back up! You can also see that the slope of the line is not constant. Sales Rank degrades quickly at first and then the rate of decay slows.

 

2. Current Sales Rank CAN’T Tell You How Well an Item is Selling

Because of the huge swings that sales rank can undergo (see the previous graph), looking at a single data point can’t tell you how well an item is selling. A low sales rank (one that is close to 1), can trick you into thinking an item is a longtime popular seller, when actually, that item was just sold.

To make accurate guesses about how fast an item is selling, you need to look at multiple data points and see how an item’s sales rank trends over time.

 

3.  Don’t Ignore Items with Poor Sales Ranks

Long tail items can be great opportunities for big profits! The biggest caveat, however, is to avoid items with many competing offers. If an item sells once every few months, or even once a year, if you don’t have the Buy Box at the right time, you could be out of luck and stuck holding a long tail item even longer than you expected.

 

4. Consider Product Reviews in Conjunction with Sales Rank

When you’re not sure about the accuracy of a single sales rank, look at the product’s reviews. The more product reviews an item has, the more likely the sales rank is to be accurate. If an item has a good sales rank but no product reviews, it’s likely that the sales rank is the temporary result of a sale. You can also check in-stock quantity. If sellers have many items in stock, it’s more likely that the item is not a long-tail item with infrequent sales.

 

5. Use Sponsored Product Ads

Amazon’s Sponsored Product ads are advertisements for your products that appear on Amazon on product pages of similar items that are more popular than your items. If your items have a poor sales rank, these ads can be a good opportunity to improve your sales on products that have been stagnating.