Listen to Audio
Some things last forever. Pricing on Amazon is not one of them. Once you’ve determined what to sell on Amazon, you’ll need to make sure you have a pricing strategy in place as well as a tested Amazon Repricing tool in order to stay competitive with your e-commerce business.
What Is Amazon Repricing?
Product pricing in the normal business world is quite simple. You have a product that is sold at a certain price.
If the wholesale price rises, the prices of your product takes off, or if there is a sharp drop in supply and an increase in demand, you can raise the price a little bit.
If the wholesale price drops, demand drops sharply or your competitors significantly reduce their prices, you can lower the price of the goods to remain competitive.
A strict policy prevents third parties from including branded materials or reselling goods to Amazon customers. In addition, customers themselves are not very interested in learning more about you.
In a market like Amazon, you cannot completely avoid price competition once you have optimized your listing. A repricing strategy implemented in a smart way can give you an added advantage. Dig into what Amazon repricing is here.
Using Repricing Software To Keep Profits High
Repricing used to be a pretty extensive process. You had to manually type prices, analyze competitors, and report new prices to distributors. It took time and money to develop your business. With the addition of new markets and easy-to-use software, vendors no longer face these challenges.
If Amazon is part of your sales strategy, investing in software that helps you stay on top and save you time is not a luxury, it’s a smart move. The right software will give you complete control over your pricing strategy and allow you to set certain rules. Instead of drinking coffee all night to stay awake, to look at competitive prices, you can invest your energy and time in what actually matters.
To do this in e-commerce, you need to learn how to work in your business, not just in it. This means using all the tools you have access to.
Using a great pricing tool is more than just efficiency – it minimizes the level of emotion associated with your products. You know how much you paid for the product and how much profit you need to earn to get a top ranking. When you are responsible for the well-being of the team and have several things on the go, the pressure can increase.
You will never have complete control over the performance of your product, but at least you can to optimize it and prepare it for the best possible chance to win the Amazon buy box. However, after you have done your part, for your emotional health, and the health of your business, it will be better to forget about it.
The repricing tool creates a barrier between you and the product, which reduces stress. By reducing some of these stresses, you can simultaneously increase your own productivity in own your store.
Finding The Right Amazon Repricer Tool
Repricing tools come in different shapes and sizes. Some are ideal for retailers who simply want to see what repricing can do for them. Others are designed for large, enterprise sellers or sellers looking for additional functionality and support.
Each has its own set of advantages and disadvantages – I recommend checking out Sellersnap, though.
The Right Tool For Your Needs
All these tools have the same basic functions. They help you keep track of your competitors and match them, as well as create rules that optimize your prices in order to win the Buy Box. The most important thing is to find what fits your budget and current sales goal.
The Repricing Strategies You Need In Your Business
Set Price Minimums And Maximums
Choose the lowest and highest prices at which you will be happy to sell your product, and set them as a minimum and maximum price. This will keep your prices within a predetermined range, ensuring that you do not suddenly crash.
In order to set the correct minimum and maximum prices, you need to find the right price relevant to the market.
If the price is too high, you will be left with things you don’t want to keep in your sale warehouse, wasting valuable space and money. If you set the price too low, your profit will be affected. It also sets future expectations with buyers, which will only lead to even lower prices.
Take the time to regularly study the performance of your products. If a particular product has been in the bottom bracket for too long, it may be time to reconsider whether the selling price is suitable. Don’t be afraid to look at your inventory and get rid of items that aren’t moving.
Don’t Be Scared To Compete
Avoid falling below the minimum price and below the price of other sellers, underestimating the price by a couple of cents. This is a slippery slope where everyone loses. If some competitors have underestimated your prices in the past, you can set rules that exclude them from consideration. Thus, your repricing tool will not take their products into account when your prices are being set.
Sometimes you are beaten, this happens. Instead of chasing the price, it’s time to rethink your whole list of products. You should make sure that it the best it can be. Optimize your keyword search, evaluate the photos of your products, and make sure that you are doing everything you can to get your ad on the top of the list.
Most of the time you should avoid being the cheapest seller. This affects profitability and is unsustainable in the long run. However, if you have a lot of products that need to be moved, but that is simply not being sold, or you are selling goods that will be stopped after this cycle, a low price offer could be a good option.
Price Based On Condition
If you trade used goods like used books, the condition of the goods should be part of your pricing strategy. The buyer will pay no more for a “Good” book than for a “As New” book.
Establish goals that maintain a competitive price within your category, without exceeding the price of higher quality products.
Make Data Your Best Friend
Let the data and feedback guide your pricing strategy. Gather information about your competitors, the market, and how your own products are sold.
Reliable measurements and analysis of customer behavior play a huge role in Amazon’s success. Long-term success requires the feedback on which it is based. A repricing tool with powerful analytical functionality can help you create a better strategy through a better understanding of your customers.
Win The Buy Box
Remember the little box under the “Add to cart”?
That’s the Buy Box.
By winning this one can put your product in front of more customers as they are about to make that final purchase decision.
Getting into the “Buy Box” can be difficult, but it’s worth it. This is one of the main reasons for applying an effective repricing strategy in the first place. Sellers who use FBAs already have an advantage, as they are automatically eligible to apply for the Buy Box. If you use another method to fulfill your order, you must match the seller’s status.
To qualify for the competition, you must think about the following:
- Final price (base price plus shipping cost)
- Method of execution
- Delivery Time
- Sellers Rating
You should also be a good salesman. This means that you should have a high customer satisfaction rating, a successful sales history, as well as a high level of customer satisfaction. If Amazon is going to take the risk and introduce you to the Buy Box, they want to be sure that you can deliver.
Getting into the Buy Box once really brings you long-term benefits. Once you are logged in, you tend to sell more goods and get more reviews. This increases your eligibility to re-enter the competition. As in most cases, it’s a self-realizing cycle, and using dynamic repricing strategies can help you achieve this first.
You can earn short-term money with a relatively aggressive pricing strategy, but when it comes to winning a long-term game, you need to find the balance.
The Winning Repricing Strategy
There is no repricing strategy that affects every seller in every situation. You have to find the balance between putting the customer first and working with your profit.
When you sell products on Amazon, the way you interact with your customers also affects Amazon’s relationship with them. This giant – all about the customer – is what Amazon’s entire model is built around, offering excellent service at a low price. Don’t be mad at the beast, trying to deceive your customers. It will end badly.
It can be tempting to raise prices too much when the competition is lower or to lower them too far down when it gets a bit too hot. Too often, fluctuating prices can draw your customer’s attention to the price, rather than the benefits they will get from using your product. This could be detrimental to the entire market.
When you simply sell on a market such as Amazon, you cannot compete on things like brand recognition and differentiation. Frequent price changes are a big thing in the market, but that’s no excuse to go crazy.
To sum it up
In order to maximize sales on Amazon, you must consider the best pricing strategies.
Smart sellers don’t put all their eggs in one Amazon basket. If you want to create a brand and sell it on your own website and through other channels, the sequence can pay off. When selling on Amazon it is to your benefit that you take advantage of Amazon repricing strategies to optimize your sales.