Breakdown of the Amazon Tools and Home Improvement Market

According to Amazon, by 2025, the home improvement products and tools category is expected to exceed $620 billion in the US alone, growing at an annual rate of 4%. This segment of the online shopping giant offers a lot of potential for brands selling these items as it the customer is quite

Some of the popular categories within this are:

• Power tools
• Hand tools
• Hardware
• Electrical equipment
• Safety gear

Competitive landscape and challenges faced by brands

It’s true that larger brands do hold a lot of market share within this space – like HomeDepot and Lowe for certain products – but that doesn’t mean there isn’t opportunity for brands who have created memorable services, products and have built a loyal brand following to stand out from the bigger companies.

Niching down to the less saturated categories could be one strategy for a brand, there may be less traffic but with less competition you stand to make more sales than you would with the highly competitive segments where the price competition alone would cause you headaches.

It’s therefore important that provide the best customer service possible, maintain positive reviews and ratings and create a memorable brand to stand out from the bigger, more well-known companies.

DIY 101: The basics of creating a good Tools & Home Improvement brand on Amazon.

To get set up for success on Amazon there are a few foundational must-haves to build a brand. Here are our top tips for doing this, let’s drill into them.

1. Optimise Product Listings for a boost

Amazon’s A10 algorithm powers the Amazon Search Result Page and decides which products to recommend. It uses data such as listing keyword placement, conversion rate, consumer purchase behaviour, sponsored ads and others.

While a lot of factors determine placement, you should ensure your product listings are optimised as best as they can be to encourage conversion rates etc. Here’s how to do it:

Conduct Amazon Keyword-research

Without keyword research on Amazon, you are listing your product blindly. You may know how you would search for your product, but you don’t know how your customers will search for it. And that can make a big difference.

So, say you’re a brand selling “too kits” and are looking to create a product listing that stands out, here’s how we would conduct some keyword research;

We use platforms such as Helium10 to search for a specific search term, i.e. “tool kit”. The platform allows us to see the search volumes of “ tool kit” and its related keywords. Then you may want to add more words to this like “small home tool kit ” to see search results.

2. Add Keywords to Your Product Title and product description

Once you have conducted your keyword research, we recommend including the most important, high-search volume keywords in your product listing title.

Think about it from your potential customer’s perspective – they’re going to search for exactly what they are looking for, so these words should be included in the title. You have a character limit of 80-200, depending on your product category, so check what this is with Amazon’s Style Guides.

Include the main keywords in the title, keeping it concise and direct. Extra keywords can be transferred to backend search terms, bullet points and descriptions.

Keep the most important keywords/message in the first 70 – 100 characters

• Unicorn layout “Brand – Product Name (with KWs) – Colour – Size/Quantity”.
• Hyphens should be used to separate topics and commas to separate words.
• There is no need for extra information in the title, it can be expanded in the bullets.

For your product description, you want to elaborate on the bullet points above and give the customer a reason to buy your product. You can add HTML to this description to make it more readable and appealing to consumers. Include details about your brand, the benefits of the product and any “extras” you may offer, such as a warranty. We have an Amazon product listing optimisation guide which you can use to set up your create discoverable product descriptions.

3. Add Images & Videos

Adding visuals will make your product listing stand out and a good image and/or video can sell faster than any piece of text can. You can add up to nine images within a product listing, including a main image and potentially a video.
Well-photographed, professional images are an absolute must for your listing. Ensure that your main image is on a white background, and include a mix of product and lifestyle images that clearly show what your product is.

Amazon Video is becoming predominantly more important. With the rise of TikTok over the past few years, all social media platforms & advertising platforms have been prioritising this feature as statistically, people prefer to obtain information through short videos than reading text.

Video is the easiest way to develop that emotional connection, to help the customer picture the product in real life and how it will benefit them.

Here are some best practices for videos on Amazon product listings:

• Stay consistent
• If using voice-over, use subtitles
• Include quick introduction
• Ensure it is short yet informative
• Have a key takeaway

4. Optimise your product descriptions

For your product description, you want to elaborate on the bullet points above, and give the customer a reason to buy your product. Utilise A+ or Premium A+ content.

Include details about your brand, the benefits of the product and any “extras” you may offer, such as a warranty. We have an Amazon product listing optimisation guide which you can use to set up your create discoverable product descriptions.

Next step: Leverage Amazon’s fulfilment options

A seamless shipping experience for your customer is a big plus, and will help encourage the customer to shop with you again. And, Amazon is definitely known for its reliability when it comes to that department!

Amazon has a few fulfilment options available to you – here’s a handy guide explaining the ins and outs of the different Amazon fulfilment options.

For this article, we will talk about the two main fulfilment options you might consider: Fulfilment by Merchant (FBM) and Fulfillment by Amazon (FBA).

What is Fulfilment by Merchant?

With the Fulfilment by Merchant (FBM) option, the brand is responsible for storing products in its warehouse or with a 3rd party fulfilment provider (3PL).

This includes storage, picking, packing and labelling, which can be taken care of in-house or with the assistance of a third-party logistics partner. You will record your products on Amazon, where buyers can purchase, but that’s the end of Amazon’s involvement.

Sellers that use this method without having prime eligibility, won’t show the Prime badge on product pages. If you want Prime Access, you can choose the Seller Fulfilled Prime (SFP) method, which we will talk about in the next section.

Great for:

• Customisable products as they cannot be sold through FBA
• Low sales volume as FBM can be a cost-effective option
• Large or Bulky Items: as they may incur higher storage fees in FBA
• Brands that want to provide a personalised customer experience as this option allows brands to send personalised packaging, branded cards and a more tailored experience.

What is Fulfilment by Amazon?

In the Fulfilment by Amazon (FBA) option, Amazon manages the complete customer delivery experience. FBA allows products to be shipped to an Amazon fulfilment centre, where Amazon takes care of the rest – from storage to shipping and delivering to buyers.

Great for

• Brands that have high sales volume as Amazon can streamline the fulfilment process, this is especially important during peak seasons or busy periods.
• Brands looking to tap into the Prime customer base as FBA products are eligible for Amazon Prime
• Brands looking to expand their reach to international markets, allowing efficient international shipping and handling of orders.
• Brands with limited warehouse space or those seeking to minimise their fulfilment logistics and expenses.
• Brands fighting for the buy box

Best practices for your inventory planning:

• Build and maintain relationships with suppliers
• Monitor your sell-through rate
• Restock popular products quickly
• Run promotions to reduce ageing inventory
• Keep an eye on your margins
• Reduce excess inventory to increase your profitability
• Choose the right inventory management system
• Maintain four weeks of inventory cover

Advanced DIY level: Implement effective marketing strategies

1. Get in front of customers with Amazon Advertising for Tools and Home Improvement

A key strategy for competing and succeeding in a saturated category is to utilise Amazon Advertising. Granted, one major consideration is budget as this category has big competition which means higher bids are needed for Cost-per-clicks (CPC) and competing with bigger brands.

Amazon advertising for electronics requires a full article to talk about (see a complete Amazon Advertising Guide for Brands: From Sponsored Products to DSP here) but we have spotlighted some of the Pay-per-click (PPC) ads you can utilise:

Self-Service Amazon PPC includes:

• Sponsored Product Ads: Crafted to elevate the visibility of individual products, these ads are tailored to appear alongside organic search results.
• Sponsored Brand Ads: Designed to enhance brand recognition, these ads showcase a brand’s logo, a curated selection of products, and a captivating tagline.
• Sponsored Display Ads: Capitalising on the power of product targeting, these ads extend beyond Amazon’s confines, reaching potential customers even as they explore the broader web.

Searching for a robust advertising strategy that will power up your PPC campaigns for your electrical products? Download our Amazon Advertising Plan Template.

2. Focus on building customer reviews

Word-of-mouth is a powerhouse when it comes to brand promotion, but it’s relatively out of your control. The next best thing is customer reviews.

The more reviews you have the higher your trustability is. This is powerful in swaying purchasing decisions for customers in a very crowded electronics segment. Building reviews is a long-term strategy that’s mixed with a focus on customer service and experience, but if you get it right this has the power to set you apart from the competition.

In addition to converting customers, more reviews spell out some nice benefits; they affect keyword ranking, buy box eligibility and the ability to qualify for Amazon’s Choice Badge.

Reviews are crucial as they build trust in a product, with customers relying on positive reviews to guide their purchasing decisions. These reviews offer valuable insights into a product’s quality, usefulness, and potential issues, empowering potential customers to make informed choices.

How to do this:

1. Focusing on building a seamless customer experience. Invest in great customer service, purchasing experience and shipping process. All of this helps to foster positive sentiment that will encourage customers to leave a great review.
2. Enrolling in Amazon Vine is one of the best ways to get Amazon reviews fast and is great for new products to obtain reviews. The programme is open to sellers who use Fulfilment by Amazon (FBA), have fewer than 30 reviews and have an eligible Amazon Standard Identification Number (ASIN).
3. Implementing post-purchase follow-up emails to gather feedback. You are allowed to request reviews, either via Amazon Seller Central or third-party tools that do it automatically while respecting Amazon’s policies such as FeedbackFive. Once an order has been delivered to your customer, you can request a view from customers inside Order Reports. This feature allows you to send one follow-up email to shoppers within 4 to 30 days of the purchase, and you cannot send two requests.
4. Leveraging social media and other channels to drive initial reviews. A key selling strategy that can lead to organic Amazon reviews is to encourage your social media audiences to leave reviews. Building a robust social media strategy that focuses on brand awareness and conversion can lead to boosting your sales on Amazon.

To effectively manage your reviews, set up daily check-ins via Amazon Seller Central where you have a comprehensive dashboard that displays your reviews.

3. Pricing strategies that beat the competition

Developing a pricing strategy that finds the right balance between profitability and competitive pricing will be key for the tools and home improvement segment on Amazon.

Developing a smart pricing strategy that is flexible is key to success on Amazon:

• View Amazon Pricing History: This provides crucial information about pricing trends, market competitiveness, and consumer buying habits. By understanding how prices have changed historically, you can more effectively predict future price trends.
• Leverage Technology: Automated repricing tools can help to implement smart and dynamic pricing.
• Utilise competitive pricing: You can monitor your competitors’ prices and adjust yours to beat prices to remain competitive.
• Implement value-based pricing: It’s not always about being the lowest price to beat the competition. Too cheap can raise red flags about the quality of your product. Highlight the value of your products and consider customer feedback when creating your pricing strategy.

4. Collab with an Amazon Live creator

As customers turn to the online realm to tune in to home improvement tutorials, so consider working with a relevant creator on Amazon Live. Amazon Live is basically like the shopping channels you get on TV, with presenters showcasing different products on a live video.

Say you sell drills, and you want your target market to be women, you may work with a female creator who is known for DIY and home interiors, to give a tutorial on how to use the tool and all the things they could use it for in the home.

Showcasing how easily you can use the drill and what home improvement projects it could be used for could help to sway customers make a purchase!

5. Run Promotions, Discounts, and Deals to drive sales

Beginning to sell your products on Amazon is one thing, but do you know how to utilise the numerous deals and promotion options available to attract new customers, help your products sell faster and stand out from the competition?

For brands using Amazon Seller Central, the three main ways to try to earn more conversions are deals, promotions, and vouchers (if you’re in the UK, coupons if you’re in the US). To help you decide which is the right choice for your brand, we’ll simplify how each promotion works and how they differ from one another.

To get more in-depth tactics for these, read our guide on how to use Amazon deals, promotions and discounts.

Amazon deals

Amazon deals are much like any other retail deals – they offer a certain % discount across a specific time period.

This is great if your objective is to increase sales velocity in a small time window and sell through overstock.

There are a few types of deals you can do:

1. Lightning Deals: Limited-time promotions offering significant discounts on specific products, usually for a few hours.
2. Deals of the Day: Daily offers featuring major discounts on selected items for a 24-hour period.
3. Best Deals: Extended promotions offering significant discounts over several days or weeks.
4. 7 day deals: Deal that runs for 7 days instead of a 4-hour window, it’s great for those looking for a long-term conversion boost.
5. Top deal: Customers recognise Top Deals as Amazon’s most exciting products offered at spectacular discounts during Prime Day.

Amazon Promotions

Similar to how you see in shops where there are promotions that entice customers to spend some more to get a deal on products.

This is great if your objective is to drive upsell & cross-sell your products. These types of promotions won’t particularly drive significant quantities of sales, but they are definitely still worth setting up.

They will help you to drive upsell & cross-sell activities across your product range which is great for increasing your average order value, enticing customers to try a complimentary product or introducing a new product to your range. They may also be particularly useful when launching a new product.

Amazon Discounts

1. Sale price Discount
This is a discount set up in the backend of a product and is the easiest way to set up a % discount. You can set the price lower than your sale price for a certain time period.

2. Prime Exclusive Discounts:
These are discounts exclusive to Prime Members. They don’t have any fees like the deals and still have a lot of visibility during seasonal events, so they work really well during Prime Day and Black Friday!

They typically display strike-through-pricing, and on Prime Day, they display the Prime Day Deals badge.

To be eligible to set up Prime Exclusive Discounts, your products must meet the following criteria:

• Must be in new condition
• You need to use Fulfilled by Amazon
• Discount must beat the lowest price in the past 30 days
• The discount must be 10% – 80% off of your listed price. For a Prime Day discount, it must be 20% – 80% off your listed price
• Have 3-star ratings or above
• Not a restricted or offensive product

Again, to get more in-depth tactics for these, read our guide on how to use Amazon deals, promotions and discounts.

Our thoughts

We really must stress that winning off of Amazon will also help you on Amazon. Building a recognizable brand to a certain customer base will help you in the smaller segments beat out the bigger competition.

However, your action plan for success is to ensure you follow the steps above for creating a good brand profile, product descriptions, and utilising some of the key marketing strategies to get your products seen by customers.

As Amazon continues to evolve, staying informed and adaptable will be key to your brand’s success. Keep experimenting with new strategies, monitor your performance, and remain committed to delivering exceptional value to your customers.

Who we are

We aren’t your typical agency. We truly partner with the brands we work with; your success is ours. We bring creativity, enthusiasm, and innovation to every brand we partner with. We aren’t afraid to tell you what’s wrong, and we will always share what can be done better. We strategise together: We are consultants, advisors and Amazon experts here to help you on your journey. Our expertise is an extension of your team; we are your Amazon partner.

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