Why the old two-number method stopped working
Product selection on Ozon used to come down to two figures: market size and competition level. That was enough a few years ago. Today the same effort in two different products produces completely different results.
Ozon has changed a lot since then. Commissions, logistics and related costs reshaped the economics, competition became multi-factor, and the platform closed some of the data we used to build our analysis on. For example, Ozon no longer shows the number of products and the number of competitors in a category. We found a replacement: the figure is available in category analytics, and it is convenient to work with.
The result: the fate of an Ozon store is largely decided before sales even start, at the product selection stage. Some categories have the same demand and the same money in them, yet earning in one is several times easier than in another.
The baseline metrics we start with
For the first screening we look at around ten metrics. The main ones:
- sales trend: is the category growing or declining;
- sales volume;
- average order value;
- buyout rate (the share of orders customers actually keep);
- how strong the competitors in the category are;
- whether Ozon itself sells in the category: if it does, competing is harder.
We also look at the amount of money in the category. Categories differ enormously: some turn over millions per month, others many times more. But what matters more than total volume is average profitability per seller. Often a highly competitive niche has more money per seller than a quiet one. In that case it makes sense to enter the more competitive category.
What we check before launch
The deeper pre-launch analysis covers 12 to 15 metrics. The main ones:
- conversion rates;
- competition level;
- demand volume;
- money in the category and money per seller;
- potential: how far this product can be developed and pushed into the top;
- expected profit if you trade under market conditions.
The metrics alone do not give a ready answer. Everything after that comes down to the details and nuances of a specific product and store.
The main red flag: markup below 5x
If a product's markup over purchase cost is below 5x, we do not enter it. Even if there is no competition. The cost side on Ozon today is such that at a 2x to 3x markup you are guaranteed to trade at a loss, at 4x to 5x you often break even or make a small profit, and anything above 5x gives a chance at 10 to 20 percent net margin.
Only after this filter, if the product passes, do we look at market volume, demand and money per seller: the more money in the category per seller, the easier it is to grow there.
Example: a product from zero to $13,300 a month
In August we launched a product on a partner's store. Through September, October and November we ramped it up: gained positions, did SEO, built out advertising. From December it started growing well, and the product reached roughly $13,300 a month.
This is the trajectory of someone who entered not just any product but the right category, and applied the full playbook of SEO, advertising and logistics. In the right niche the same effort and money produce growth; in a difficult one you can fight a ceiling for a year.
How to check your own economics
Before buying inventory, calculate your profit including commission and logistics. If the resulting markup is below 5x, look for another product.
Key takeaways
- Market size and competition alone no longer predict success on Ozon.
- Screen on around ten baseline metrics, then go deeper on 12 to 15 before launch.
- Money per seller matters more than total category volume.
- A markup below 5x is an automatic no, even in an empty niche.
- The right category multiplies the same effort; the wrong one caps it.
