A Google search for the most profitable products to sell online will overwhelm you with a plethora of choices because virtually any product has the potential to yield profits.
But if you’re looking to cut right to the chase and identify products that can provide instant return on investment, you’re in the right place.
In this article, we will provide insight into what makes a product profitable and how to determine a product’s profitability. We will also list the 9 most profitable products to sell online in 2024.
Outline
- What Makes a Profitable Product?
- The 9 Most Profitable Products to Sell Online in 2024
- How to Determine a Product’s Profitability
- Conclusion
What Makes a Profitable Product?
Before you start selling online or even searching for profitable products to sell online, you should know what makes a product profitable.
For starters, you should know that profitability isn’t measured solely by how much you’ll earn selling a product. Any product can sell for big bucks.
For example, Jack Dorsey sold a screenshot of his first tweet as a non-fungible token (NFT) for a staggering $2.9 million. Even seemingly unconventional items like a cat butt tissue holder have become a hot commodity on popular ecommerce platforms like Amazon.
However, if you’re looking to start a sustainable business selling profitable products online, you must look beyond the “market hype” to find products that would yield both short and long-term profits.
Profitable products are defined by their high-profit margins, how often they can be sold and turned over, how many prospective buyers are in the market for that product, and how many sellers are offering the same or closely similar products.
Let’s explore these in more detail.
High Margins
Profit margin is the difference between the sales price and the cost of producing or acquiring the product. A high-profit margin means a significant portion of each sale contributes to your business profit.
This allows you to recover your initial financial commitment and provides room for covering any unforeseen, direct, or indirect additional costs that may arise while selling the product.
Repeatable Sales
While one-time purchases contribute to short-term profitability, it is the ability to secure a consistent stream of customers and recurring sales that truly drives long-term success.
Products that fulfill ongoing needs or have a subscription-based model have a higher potential for repeatable sales. Thus, you can cultivate a loyal customer base by building customer loyalty and creating a positive user experience, leading to a steady revenue stream.
Large Target Market
A profitable product should have a broad customer base with many potential buyers. The larger the market, the more opportunities there are for sales and revenue generation.
Conducting market research and identifying the demand for a product is crucial in determining its profitability potential.
By understanding your potential customers’ needs, preferences, and purchasing power, you can tailor your products and marketing strategies to maximize profitability.
Low Competition
High competition often leads to price wars, diminishing profit margins, and market shares. Contrarily, a product that faces minimal competition or offers unique differentiators has a greater chance of capturing a significant market share and, thus, higher profits.
Essentially, low competition allows businesses to position their products as distinctive and desirable, often enabling them to command higher prices they need to maintain healthier profit margins.
The 9 Most Profitable Products to Sell Online in 2024
These products have yielded the highest profits for businesses in 2023 and are still selling very fast and at a high-profit margin in 2024.
Beauty Products
Beauty products to sell online can range from inclusive makeup shades to haircare products, skincare products, facial tools and devices, beauty supplements, and natural and organic skincare. These products usually have high profit margins.
The good thing about selling beauty products online is that there is a range of products for you to choose from, and you can easily replace one product for another or one brand for another without significantly affecting your market position.
The profit margin is so high that you can set your markup (the amount added to the cost of an item to determine the price at which it is sold) at 700% on cost if you’re a named brand like “Fur” or have your own line.
Computer Accessories
As more people work from their homes and on their personal computers, they invest in the look and feel of these computers, creating a buzzing market for computer accessories sellers.
These accessories include ergonomic keyboards, ultrawide monitors, surge protectors, SSDs, docking stations, and webcams. You can also stock smartphone accessories as a computer accessories seller, as both niches are related.
Depending on your brand positioning and target audience, you could have up to 50% profit margin from selling computer accessories.
Pet Care Items
The market for pet care products increased by almost 50% between 2022 and 2023, with most sellers making at least £2 on every customer visit. Hot-selling products in this niche include grooming supplies, pet toys, dog houses or beds, and pet food.
Sellers who stay long enough in this niche have the opportunity to recoup their capital in no time, as the profit margins from pet products can reach up to 40%.
Phone Accessories
Smartphone accessories typically go hand in hand with smartphone sales. But even better, they move a lot faster due to their relatively shorter lifespan and customisation appeal. These accessories include protective cases, screen protectors, chargers, cables, wireless earbuds, car mounts, power banks, and pop sockets.
With every new generation of smartphones, there’s a constant demand for accessories that are compatible with the latest devices. Likewise, with increasing mobile phone penetration, this demand is always shooting upwards.
Phone accessories often have a higher profit margin than the mobile phones they’re made for. As a phone accessories seller, you can make between 50% to 75% profit on each sale which mostly depends on your supplier and the products you choose to stock.
Athleisure Wear
Athleisure wears are a hybrid of casual clothes and athletic clothes. They can be worn to work out and also to a cafe or grocery shopping. These clothes have been in high demand due to more people opting for comfort as well as style.
For context, there was a 60% drop in the orders for dresses while the demand for athleisure wear has been rising by 84% percent.
Wristwatches
Wristwatches remain a timeless accessory that appeals to a wide range of customers. Whether it’s classic, minimalist designs or modern smartwatches with advanced features, online sellers have various options.
This category includes analog, digital, luxury timepieces, smartwatches, and fitness trackers. The profit margin for online stores in the wristwatch niche can be as high as 25%, which could also be higher depending on whether the watch is from a luxury brand.
Read More: Start a Watch Business by Following These 09 Steps
Jewelry
Starting a jewelry ecommerce business is one of the most profitable things you can do, as jewelry usually has a very low cost and high selling price. People often attach sentiments to jewelry, so it’s less about monetary worth and more about how the jewelry makes them feel.
Because of this intrinsic value placed on jewelry, you could make as much as a 100% profit by attractively positioning your products. For example, instead of “chain necklaces,” you could sell “couples chain necklaces.”
However, as an average jewelry seller, you can earn up to 47% gross profit. Also, you can even start selling jewelry without money; this article shows you how.
Electronic Gadgets
There is a vast market and great potential for success in selling electronic gadgets on your online store. The demand for innovative and cutting-edge gadgets continuously grows, presenting an opportunity for entrepreneurs in the ecommerce space.
To tap into this lucrative market, offering unique and high-quality electronic gadgets that stand out is crucial. By emphasizing the features and benefits of your products, you can attract tech-savvy customers and drive sales. Selling general electronics could earn you a profit of almost 30%.
Kids Toys
The market for kids’ toys is always in demand, making it a profitable category for online sellers. This category includes various toys for different age groups and interests, such as plush toys, building blocks, puzzles, board games, dolls, and action figures.
By offering a variety of toys that promote creativity, learning, and imaginative play, you can cater to the needs of parents and gift-givers who are always seeking engaging and educational toys that provide both entertainment and developmental benefits for children.
You can make up to 40% profit selling children’s toys in the first 7 months of starting your business.
How to Determine a Product’s Profitability
Buying a product for $45 and selling it for $55 may indicate a profit of $10, but this analysis may not reflect profitability in reality. Here are better ways to evaluate your product’s profitability:
Cost Benefit Analysis
In a cost-benefit analysis, you would compare the cost of a product (including the shipping costs, storage, and sales cost) against the benefit you’ll gain from selling it (money earned from a sale).
A cost-benefit analysis provides a holistic view of the financial implications of buying and selling a product. With this analysis, you not only consider cash returns, but also the purchase and selling price alongside other associated costs like production, packaging, marketing, and distribution.
Say, for instance, you choose to sell a product that costs $10 per unit. Don’t assume that’s all you have to spend on each unit. You may need to spend an additional $5 per unit on overhead costs like marketing and labor. Compute all the costs to arrive at your total cost then compare this against your preferred profit margin.
By comparing the costs against the expected benefits, you can determine if the product is truly profitable or if adjustments need to be made. Examples of adjustments you can make include an upward review of price or a change of supplier or storage facility.
Break-Even Analysis
Break-even is when your cost is the same as your earnings. At this point, you neither make a profit nor loss. Instead, break-even analysis helps you identify the point at which your product’s sales cover all costs and begin generating profit.
By considering fixed costs (such as rent, salaries, and electricity) and variable costs (like raw materials and shipping), you can calculate your break-even point in terms of units sold or revenue generated.
Here’s how this works in practice. If you buy a product for $5 and the variable and fixed costs associated with buying and selling that product are $2, you break even at $7. This means that if you sell the product at $7, you’re neither in a profit or loss position. But if you sell higher than $7, you will make a profit — and if you sell for less than $7, you will certainly make a loss.
Understanding this critical threshold enables you to set realistic sales targets and pricing strategies to achieve profitability.
Margin Analysis
Margin or profit margin is the difference between your break-even and selling prices. Your goal should be to ensure that your profit margin is as high as possible.
Analyzing margins allows you to continuously evaluate your product’s pricing strategy and cost structure, ensuring that you maintain healthy profit margins and make informed decisions to improve profitability.
Return on Investment (ROI) Analysis
As an ecommerce business owner, you need to know your ROI as it’s what helps you tell whether to buy more or less of a particular product, switch to a different line of products, or stop selling altogether.
Basically, an ROI analysis helps you assess the financial performance of an investment relative to its cost. When applied to a product, it helps you evaluate the return generated from selling the product as against the initial investment made to develop, produce, or buy it.
Market Share Analysis
Market share analysis provides a broader perspective on product profitability by assessing your product’s performance within its competitive landscape.
If you plan to sell on a particular ecommerce store, your market research should also be platform-specific.
By analyzing your market share relative to competitors, you can gain insights into customer preferences, pricing dynamics, and overall market trends.
This analysis helps you understand how your product’s profitability compares to others and identify strategies to increase your market share and profitability.
Conclusion
Starting an online business can be lucrative once you know the profitable products to sell based on your location, preference, and capital. You can also check Google Trends to see the products that are trending in your niche.
However, it’s important to note that success in your online business goes beyond product selection. To maximize your earning potential, you must also harness the power of an effective e-commerce platform like Shopify and PageFly makes this easy.
PageFly can help you build the perfect Shopify website, giving you your own online store in no time.
