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Selling on Amazon.com

June 21st, 2011

For most software developers, Amazon.com represents an untapped marketplace. Is your software sold there? Your software can be listed on Amazon, but most software developers do not know how to list a product there. This marketing channel is totally separate from your normal internet driven sales so it should not compete with your current sales.

Amazon.com only sells physical products. They do not sell software downloads. To sell a product on Amazon you need to have a physical version of that product. A physical product can be as simply as a CD in a case, or more likely, a CD or DVD in a standard DVD case, with a printed insert surround the DVD case. (You can print this insert on any inkjet or laser printer.)

Basic Amazon requirements include:

  • A physical product that will be shipped to a customer
  • A unique UPC or EAN bar code number for each product
  • A “sell-a-lot” developer contract with Amazon
  • Credit card and a bank account capable of receiving ACH deposits

Every product sold on Amazon needs a UPC code assigned to it. You can not make this UPC code number up, it must be an authentic code assigned by gs1.org, or another legal assignment agency like My Bar Code Store. GS1.org charges a yearly fee of at least $750 for a minimum of 100 UPC codes. Other firms like My Bar Code Store charge a one time fee of from $20 – $50 depending on the number of UPC codes you need. Unique UPC codes are required to list all products not currently found on Amazon.

Amazon charges a monthly fee of about $40 to host your merchant account. You must sign a contact for a minimum of 3 months. For software Amazon takes a 15% commission on the purchase price (not including shipping). From an economic point of view- if you can sell at least $50 of your software each month on Amazon, you will break even. If you sell more than $50 a month, the extra sales are extra income.

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  1. June 22nd, 2011 at 05:43 | #1

    Interesting article, Gary, thanks. I can see that you sell on Amazon. Is it good business or just barely worth the bother?

    And: I heard that you don’t get the customer’s real e-mail address. True? That would be a problem when the customer looses his registration code…

  2. June 22nd, 2011 at 09:43 | #2

    Selling on Amazon makes us money.

    You do not get the customer’s email address, but that is not a problem. You are selling *physical* products. The customer bought your product on CD. If there is a code is is printed on something associated with that CD. If they lose it, they are out of luck- just like if you lose your code for your Microsoft Windows XP CD.

  3. September 6th, 2011 at 03:59 | #3

    Good article Gary, exactly the information I was looking for!

    I’m based in the UK, so self-duplicating and posting to customers in US/Canada wouldn’t be practical. What’s your thoughts on using a fullfilment service such as CDSwift? I can’t see any problems but I may have overlooked something 🙂

  4. September 6th, 2011 at 14:22 | #4

    @John King

    I would be careful about which fulfillment service you use. Amazon has *strict* requirements that mandate your product images must match the shipped product. In addition, many fulfilment sevices ship plain CDs, without any sleeve, in a flimsy paper mailer. A significant percentage of these CDs get damaged in the mail. Your Amazon customers will post negative reviews when this happens.

    One of my companies offers a competing service. Check out CD-Ship.com ( http://www.cd-ship.com ) All of our priducts are shipped in sleeves, and inside padded envelopes. Our failure rate is less than 1 in 2,000.

  5. June 4th, 2012 at 09:06 | #5

    Apparently, there is way to sell software for download only on Amazon.

    http://www.amazon.com/pc-mac-software-downloads/b?ie=UTF8&node=1233514011

    But it may not be open to every software vendor.

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