Amazon Seller Solutions: Pricing
If you are a seasoned seller on Amazon or a retailer, you’ll know the prices of products don’t always remain the same. Amazon sellers are known to shift their prices, leading to a highly competitive and reactive marketplace.
WXY takes a look at what Amazon sellers must do to remain price competitive online and beat their competitors to guarantee sales.
Main factors that affect pricing:
Sellers getting rid of old stock
Last season stock
Just take a look at the below example of a popular kitchen appliance and the change of price over a one-year period.
Lowest price £21.99
Highest price £39.99
It’s interesting to note that analysing historical data shows this product sold in 2015 for a whopping £69 ($88), during a popular time for blender sales off the back of the Nutribullet craze.
Is your product elastic?
This is a question that everyone should ask, and it doesn’t mean if there’s elastic in your product but that it’s price elastic.
Time for a mini economics lesson; the basic law of supply and demand is the lower the price, the more people will demand it but changing the price on some products can have significant impacts on sales and others, not so much.
If your product is elastic, it means changing the price can have dramatic effects on the demand. For example, a Gucci handbag selling for 40% under the retail price could see it sell out, also desired products, such as luxury cars with high price tags attract a certain customer, more so than if the price was low.
Elastic products are products that when the price changes the demand might not necessarily be different; this includes products such as milk and bread and certain seasonal essentials, such as sun cream, for example.
So, it’s worth running a test to see if changing your price affects sales. A good A/B test across a certain period, reducing slightly and reducing a lot can help see where your product’s price point should be.
Top three questions Amazon sellers need to ask:
1) What are my competitors selling at?
This isn’t just looking at current prices but working out what is the maximum/minimum they have charged and when. How often do they change their price and what is the average price they sell their product for.
2) What is it selling for across the internet?
Many retailers sell on their own dedicated shops, and huge retailers such as Firebox, Not on the High Street and Argos have huge marketing and digital teams analysing the price points of their product. Find similar products across the internet, not just on Amazon.
3) How many views are your products getting?
Many factors can affect the views of your product, but one of them could be price. Changing price accordingly and seeing the change of views can help achieve the sales you need.
WXY offers competitor reports with our SEO Plus package on prices of the same or similar products that could be affecting your sales. We provide an array of solutions to help improve your product discovery on Amazon and increase your revenue. See below and enjoy more sales on Amazon with WXY.