6 Ways to Make Passive Income on Amazon

Introduction

Many people dream of making money without having to lift a finger. While this might seem too good to be true, passive income is one way for individuals to earn money without putting in a lot of effort. Passive income—which is different than having an Amazon side hustle—is defined as earnings that require little or no effort on behalf of the earner. Passive income may take the form of earnings from a rental property, a limited partnership, or a separate venture where the earner has limited involvement. 

One great avenue when it comes to earning passive income is Amazon, which itself makes $1.29 billion per day. Passive income through Amazon can be a great way to develop a new revenue stream or supplement your current salary. 

As far as how to make passive income on Amazon, it will require some upfront work. Before you can start making passive income on Amazon, you’ll have to lay the groundwork for your venture. However, once you get started, you can sit back and earn income without having to do much at all. Check out the article below to learn more about how to make passive income on Amazon.

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What is Passive Income?

Passive income is defined as revenue earned with hardly any active involvement.

As you might expect, unlike active income—which requires constant hard work to earn a profit on Amazon—passive income lets you easily make tons of money even when you’re not working. In short, you can make your money work for you.

Although, it should be noted that, to truly earn passive income without doing anything, you’ll need to invest a huge amount of work upfront to get the entire process effectively automated.

By investing many hours of hard work in the beginning, literally anyone no matter their background can create a passive income stream that will allow them to break the 9-5 work cycle.

How to Make Passive Income on Amazon

While selling products on Amazon is a popular way for people to earn money, it is not always completely passive. There are certain products that you can sell—not to mention failed Amazon products you should avoid—which, after some initial work, can start generating passive income. Here are 6 good examples to study:

1. Amazon Associates Program

The Amazon Associates Program is an affiliate marketing program offered by Amazon. Amazon Affiliates sign up and receive unique affiliate links for the products they choose to promote. When someone clicks on a generated link and makes a purchase on Amazon within a specified timeframe, the affiliate earns a commission on that sale. Amazon tracks the sales and calculates the earnings for each affiliate, who can then receive payouts once a certain threshold is reached.

Affiliates opt to use their social media accounts or personal blogs to talk about the newest products they’ve fallen in love with. You may be surprised at just how effective promoting your Amazon products on social media or a blog may be.

Affiliate marketing is a great way to make passive income as you don’t need to create and sell a product yourself, allowing you to focus on marketing and promoting the product. The initial work needed is in the realm of creating content and other promotional materials, but once those have been made you can use them to continuously attract customers and make sales (which you earn commission on)!

The 5 steps you’ll need to succeed with the Amazon Associates Program are:

• Select your niche: Pick a good niche that closely aligns with your specific interests and that has an excellent range of related Amazon products.
• Create content: Design and post to a blog, website, or social media platform where you can then create content for your followers.
• Promote your products: Work to promote your affiliate links in natural ways within your content. This could be in your product reviews, tutorials, and recommendations.
• Engage with your audience: Cultivate an audience that loves your brand by creating content and recommendations they’ll love.
• Find winning SEO keywords: Ensure your content is optimized for search engines by adding relevant SEO keywords in a natural way to your content.

2. Amazon Influencer Program

The Amazon Influencer Program allows influencers to curate their own custom Amazon storefronts, featuring products they test out, review, and then recommend to their followers. Through the Amazon Influencer Program, influencers receive a unique URL that leads to their curated storefront. This URL is shareable across their social media accounts, allowing their followers to easily access and shop for Amazon-specific products they endorse.

Even though Amazon does not specifically say how many followers you’ll need to have to join the program, the actual number isn’t very high and is easily reached. There have been many cases where new influencers have been approved with only a few hundred followers.

Furthermore, when followers make purchases through the influencer’s storefront, the influencer earns a commission from each sale, incentivizing them to promote products they genuinely believe in. It is a great way for influencers to earn an Amazon passive income because anytime anyone uses their unique URL link to purchase a product, they earn a commission!

The 4 steps you’ll need to succeed with the Amazon Associates Program are:

• Select your niche: Be sure to focus on a particular niche that your audience will love.
• Recommend products: Discover a variety of quality products that are related to your chosen niche and then recommend them to your audience.
• Engage with your audience: Always remember to engage with your audience through Q&A sessions, posts, and Amazon Live.
• Create an Amazon storefront: Design your own Amazon storefront and then share your personal URL with your audience.

3. Amazon Merch on Demand

Merch on Demand is an Amazon-operated print-on-demand (POD) platform. Through Amazon’s online marketplace, it allows designers and content creators to sell custom-designed merchandise, such as t-shirts and hoodies.

Sellers upload their designs to the platform, and Amazon handles printing, packing, and shipping to customers. Sellers then earn royalties for each item sold, without the need for upfront costs or inventory management. This is considered passive income because once you have submitted your design, customers can view different clothing items featuring your design and purchase them, earning you money. To learn more about Amazon Merch, check out our dedicated guide here!

The 5 steps you’ll need to succeed with the Amazon Associates Program are:

• Create your designs: Create unique designs that speak to your audience and help define your brand.
• Select your products: Carefully choose the products you’d like your designs to appear on. We recommend researching competitors and examining their products using our FREE Helium 10 Chrome Extension.
• Create your Amazon listing: Design an incredible listing by adding the appropriate number of images and ensuring your copy is informative, yet brief.
• Optimize your keywords: Add relevant SEO keywords to your product titles, bullets, and descriptions to ensure search engines show your product to more potential customers.
• Promote your products: Effectively market your products on social media sites—such as YouTube, TikTok, and Instagram—to heighten your product’s chances of being seen.

4. Amazon KDP + Audible

Amazon Kindle Direct Publishing (KDP) is a self-publishing platform offered by Amazon that allows authors and publishers to publish and distribute their books in digital format for Kindle devices and applications, as well as print books (paperback and hardcover). Authors upload their manuscript and cover design while setting the book’s pricing, making it available for sale on the Amazon Kindle Store. Whether you’re a novice writer, an established author, or simply pursuing writing as a hobby, KDP offers you the chance to reach a broad readership.

Once you have submitted your book to Amazon KDP, you will be able to start earning money on any sales made. Now that you are earning Amazon passive income from your book, you will have the time to start on your next novel!

In addition to selling on Amazon KDP, you can also create an audiobook version of your new novel through the Audiobook Creation Exchange on Audible. With the possibility of an audiobook being both lucrative and a way to generate Amazon passive income, you should definitely consider creating one if you have a voice others would want to listen to.

The 6 steps you’ll need to succeed with the Amazon Associates Program are:

• Create a KDP account: Head to https://kdp.amazon.com/en_US/ to create an account.
• Pick a book title: Keep in mind that your book title should capture the attention of the reader. This will help make your eBook stand out from the rest.
• Write a description of your book: Let readers know what your book is about in a short, concise manner that makes them want to purchase/read your book.
• Find your keywords: Find relevant keywords and input them into the book’s description using Helium 10’s powerful Magnet. This will help it show up in search engines, enabling more potential readers to see it.
• Upload your manuscript: The most important step is to upload your finished manuscript! However, be sure that it is in a format that Amazon can use. While there are many to choose from, doc/docx files (Microsoft Word formats) are always good to use.
• Create your book cover: The first thing your potential readers will see is the book cover, so make sure it is appealing to your target audience by conducting competitor research.

5. Digital Products

After learning how to sell digital products on Amazon, you can help earn some extra, passive income on the side. A key benefit of this method is that you can begin selling these digital products extremely quickly and with a minimal upfront investment.

After uploading your choice of digital product to Amazon, it’ll be sold automatically on the platform, giving you an avenue to earn truly passive income. What’s more, this method can even be infinitely scaled up—leading to high profit margins—by adding more products that, thanks to Amazon’s massive global reach, will ensure that they’re seen by millions of potential customers.

However, simply uploading and selling a digital product on Amazon won’t be enough; you’ll have to also know how to effectively generate sales on Amazon in order to succeed and beat out the ever-growing competition.

The 4 steps you’ll need to succeed with the Amazon Associates Program are:

• Identify in-demand products: Taking a close look at the top 25 best selling Amazon products will help you know whether the products you’re offering will generate sales.
• Gauge audience interest: Perform research and analytics regarding your audience to help gauge their potential interest in your product.
• Sign up for selling platforms: Sign up for Amazon KDP, Amazon Merch, and TuneCore. These and other platforms will help you reach as wide an audience as possible.
• Promote your products: Work to maximize both visibility and engagement when promoting your products on a blog, website, or social media.

6. Amazon Dropshipping

This can be a great way to get a large amount of products in a relatively short amount of time. With Amazon dropshipping, you’ll never have to touch your products, instead relying on sellers to do the heavy lifting for you.

It’s no surprise that dropshipping is highly popular with Amazon sellers since it easily allows you to start an Amazon business straight from home. However, this method is not completely passive; you’ll have to check the status of your operations on a daily basis.

While dropshipping may seem like the ticket to an infinite amount of Amazon passive income, it comes with some downsides, too. One such is that your customers will likely not want to overpay for products they can find cheaper from other sellers. This can make it challenging to find enough customers to make this method worthwhile.

The 4 steps you’ll need to succeed with the Amazon Associates Program are:

• Choose your product: Carefully research and identify profitable products you can potentially sell on Amazon.
• Create your Amazon listing: Create winning product listings by checking out our Amazon listing optimization guide. Here, we’ll tell you how to optimize every part of your listing for lasting success.
• Forward the order to the supplier: For every product order you receive, forward it to the supplier, who will take care of packaging, shipping, and other necessary tracking details.
• Optimize customer service: Maintain great customer service (including product concerns or issues) to avoid disastrous issues that may cut into your profits.

How Realistic Is It to Make Passive Income on Amazon?

It is very possible to make a huge amount of passive income from Amazon. The eCommerce platform in particular is excellent for generating passive income because it makes it easy to fulfill orders and has systems in place that allow the seller to be more passive in the process. 

Keep in mind, though, that setting up an eCommerce store on Amazon will require some work at the start. You’ll have to find a unique product to sell, reach out to a supplier, and take steps to make sure your product listings rank highly for desired keywords. 

After the initial setup, you can use the Fulfillment by Amazon (FBA) program to fulfill your orders with minimal effort. Unlike Amazon FBM, when you use Amazon FBA, the e-commerce giant will handle the bulk of shipping logistics, thus minimizing the time and effort you have to put into your business. Using Amazon FBA doesn’t entirely mean you will be earning passive income, though. Getting started selling Amazon products requires sellers to check in on how their products are performing, and when products sell out you need to restock them! So, in that sense, Amazon FBA can be considered semi-passive income.

If you’re interested in making passive income on Amazon with FBA, check out this Amazon FBA for beginners guide.

Conclusion

Making passive income on Amazon can be a great way for many people to earn money, but it requires strategic pricing and other important planning and some hard work upfront. You can choose to utilize Amazon’s FBA service, the Merch on Demand or Kindle Direct Publishing programs, or you can be an influencer or an affiliate marketer. Regardless of what avenue you choose to pursue, it is important to understand how each method works, and you must be able to adapt to Amazon’s ever-changing landscape.

You can help yourself stay afloat on Amazon and push through any barriers with Helium 10’s tools that are built to help you experience win after win on the platform.

Check out our pricing plan options to see how our digital selling tools can help you go from making $0 on Amazon to thousands per month today!

It’s important to note that initial effort and dedication are often required to set up these income sources effectively, but they can lead to sustainable and relatively hands-free income over time.

FAQs

Frequently Asked Questions

How Do I Make Passive Income on Amazon?

First, you have to identify and source a unique product. Second, you have to set up an Amazon storefront that attracts customers and promotes your brand. Third, you have to sign up for Amazon’s FBA program. Lastly, you should use Helium 10 to monitor and optimize your eCommerce store.

Does Amazon Passive Income Work?

Yes, many sellers earn passive income using Amazon. This is due to Amazon’s FBA program, which allows sellers to defer shipping logistics and customer service to Amazon rather than themselves. If you have a product people are willing to buy, you can successfully make passive income as an Amazon seller.

Is Selling on Amazon FBA Profitable?

Yes, selling products through Amazon’s FBA program can be profitable. However, the level of profitability depends on the amount of money you’re paying your supplier and your pricing model. You should also consider how much you’ll have to pay your supplier, Amazon FBA, and any analytics services you may use.