Amazon – Taking the Low Ticket or High Ticket Route?

It is widely accepted that Amazon know what they are doing when it comes to turning traffic that you refer to them into sales. It is also the advice given by many highly respected and experienced Amazon affiliates, that you should concentrate your efforts on high ticket items with a selling price of $100 or more.

Whilst this is generally very sound advice, and should certainly form the foundation of your Amazon affiliate strategy, are there any reasons for targeting low ticket items? I definitely think there are. Read on to find out why.

The Amazon Commission Structure

To understand my overall reasoning here, we first need to take a look at the Amazon commission structure. This varies for certain product types, but in general terms Amazon pay a layered commission percentage based on how many items your referrals have purchased that month.

Amazon Referral Rates

As you can see from the table above, for general products, this ranges from 4% up to 8.5% depending on how many sales you refer. The other very important thing to remember, is that once you pass any of the thresholds, the new rate applies for all of the sales you made that month.

So High Ticket Or Low Ticket?

Seems like a no-brainer doesn’t it? But which is easier getting someone to part with $10 or getting someone to part with $100. You might choose to disagree, but in most cases I would say that selling a $10 item is easier.

So let’s take a hypothetical scenario where I have a site promoting a $100 product. It is a fairly new site and at present I’m quite happy that it is getting a couple of sales per month. That brings me in $8 per month in commission at 4%.

Now what if I had another site that I ran alongside, selling items around the $10 mark? These are popular items and customers in this niche often purchase multiple items at one time. Through this site I find I can sell 150 items on average per month. This takes me into the 7% bracket, and even though I’m only making $0.70 per sale, this adds up to $105.

But the other site is now also making 7% instead of 4% and has now earned $14.

As I say, the above example is only hypothetical, but you can certainly see the potential. It is also probably more valid and useful for beginners than for those with established high traffic Amazon sites. When you start to achieve the levels of traffic to your high ticket site to push sales upwards, you may feel that the return on investment of time for the low ticket site is not worth it.

It is a strategy that I’m currently working with myself, and in my case it works in terms of the effort I put in, simply because the low ticket site in question is one that I have wanted to build purely for my own interest anyway.

Do you agree with my premise that making low ticket sales is actually easier? Please feel free to leave a comment and let me know your thoughts.

15 thoughts on “Amazon – Taking the Low Ticket or High Ticket Route?

  1. Hey Des,

    Nice Post.

    People usually take low ticket route, but i think it’s depends on the niche of the blog :).

    Thanks for sharing this great Post.

    ~Dev
    Dev – Technshare.com´s last blog post ..Technshare Monthly Report 5- July 2010

    • Thanks Dev. I agree it depends on the niche, but I’m hoping a strategy of working both high and low ticket niches in combination will work well.

      I’ll let you know how it goes!

  2. Des,
    Very interesting post here. I’d have to actually test the various options. I mean, wouldn’t it also depend on how well your site ranks in Google? Or how “easy” you can make it rank for certain things?

    But yes, most people will buy the cheaper options, but if you have good traffic flowing through, why not go for the expensive item? If you review a high tix item and a low one, maybe more people in general will end up buying the low tix one.

    AAAAh! I’d have to test this though!
    Moon Hussain´s last blog post ..Tools of the Trade- Do You Choose to Spend or Not

    • Hi Moon,
      you are right, my hypothetical example would have to assume both sites are receiving equal traffic levels. My main point is really that the “easy” low ticket sales will potentially gain me a higher percentage payout from more difficult high ticket sales because of the way Amazon works.

      I will let you know how I get on with my theory!

  3. I think having a mixed strategy might be best. I have a lot of sites that sell items in the $20 range, and they help boost me into at least the 6% bracket each month, but I don’t think it’s too hard to convince people to part with $200 or $300 for a vacuum cleaner (or whatever) if they are in the market for one. I’m definitely moving toward bigger ticket items myself in general, but the small ticket ones do help me inch up in the commission brackets! :)
    Michelle´s last blog post ..CB Journal Day 8- Building My Backlinks

    • Hi Michelle,
      that’s great to hear. More or less in line with what I’m trying to prove myself. Although it’s also interesting that you get good conversions with higher priced items too.

      Thanks for commenting.

  4. I agree with Michelle – as long as you pick your product carefully, and your pages/ sites are very specific, your audience would probably still be targeted buyers. If it’s a more general niche that’s not centred around specific products, I imagine it’s a lot easier to sell the lower priced items. Most of my sales are low priced items but they come off my generic hubs that just showcase random products related to the keyword. They are definitely useful for getting the %% up, though hopefully I’ll get better at more targeted reviews for expensive items.
    Ruth – Web Career Girl´s last blog post ..Other Backlinking Strategies- Guest Blogging and Press Releases

    • Hi Ruth,
      the pages/products are pretty specific, so I’m hoping with a bit more ageing and promotion I can pick up direct long tail traffic to individual reviews.

      Should be interesting to see how well I can develop it. It certainly is an enjoyable niche for me to work in, both on the blog and on Twitter. I can’t see it making too much money in its own right, but I’m hoping it complements some of my other Amazon sites in the way I describe above.

  5. I definitely that in the beginning having a mix of low ticket items as well as high ticket items is the way to go. Even if you sell one high ticket item for $400, you can still get that commission up to 7% if you are selling hundreds of lower ticket items. I really think it all depends on what exact items you are promoting and the market for them, because you could always pick lower priced items that no one is buying and this theory wouldn’t work then!
    Tiffany´s last blog post ..Online Passive Income Earnings Report for July

    • Hi Tiffany,
      it is early days for me as yet with Amazon, which is one of the reasons I decided to try this strategy. Good to hear you think it has potential.

  6. Its Amazon good idea to attract more and more professional to use Amazon store for selling products,Moreover its a old strategy that big or successful Affiliates always demanding higher omission then others
    Tej Kohli´s last blog post ..History of Animation by Tej Kohli

  7. It is a cool idea to sell high ticket items. What you can do is also sell a few low priced items first to get to higher commission on the high ticket items. Makes sense? I know it does :)
    Interview questions´s last blog post ..Learn the secrets of success in job search

    • Hi there, sorry for the slow reply. I am seeing good results so far from this high ticket/low ticket strategy. For the low ticket site, a single sale can sometimes contain several items, so it’s a great way of boosting your Amazon affiliate payment percentage.

  8. Do you think it is a good idea to list your Amazon prices on you affiliate website or should you just provide a link and let Amazon do the selling?

    • Hi Joey, sorry for the slow reply (been away for two weeks).
      I know some people maintain that Amazon text links have the best click through rates, but I really think it depends on the individual site and who your audience is. For most of my Amazon sites so far I have actually used a mixture of text links and picture links with prices.

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