Repricing: Beating the Giants at Their Own Game
It’s a new year, and a new chance to evaluate your strategies as an ecommerce player. Maybe you’ve noticed the proliferation of ecommerce giant Amazon.com, which is quickly becoming the Microsoft of the computer sector. Amazon CEO Jeff Bezos is determined to dominate the online sales market by expanding offerings and by snatching up ancillary entities such as delivery services.
What does this mean for you? More opportunities. And approaching the Amazon sales model is always a wise choice; by all accounts, they are the venue of choice, surpassing even eBay for vendors of new merchandise. Ecommerce experts estimate that 2 million sellers sold more than 1 billion items on Amazon in 2015. That number is expected to escalate quickly.
Amazon’s sea of opportunity is competitive. There’s no getting around that. If you’re peddling goods that are not custom-made, it’s likely you’re going up against other sellers who may be larger and selling at volume, or smaller and willing to accept a lower profit margin.
All of this means you’ll want to keep an eye on your bottom line—your pricing. The most customer-friendly policies and business model in the universe won’t lure pure price-shoppers away in many cases. This doesn’t mean you should be forced to undersell yourself, but just to make sure you’re offering a deal you can live with.
Enter Amazon “repricing,” or a tool Amazon uses to push their own branded and sponsored merchandise above yours. They scan pricing for like items by using automated analytics software, and reduce their pricing accordingly. Does this put you at a disadvantage? Yes. Is it insurmountable? No. Why? Because you also have access to that strategy.
There are several apps and programs out there that allow you to track pricing of the goods you sell on Amazon. You may adjust pricing the minute Amazon does, and also monitor your third-party competitors.
Here’s a visual example that will drive the point home. Five sellers are in contention for offering this Camelbak water bottle, and one of them is Amazon itself. Amazon may use its own repricing tool to automatically slot in with the best price, adding its “Prime” designation as the carrot on the stick to entice with free shipping for members.
If you were running a repricing program, you would be alerted to price shifts, and even a position that makes you non-competitive. Then you decide whether to adjust your pricing.
Are you sufficiently enticed? Give it a try. Many developers of repricing apps offer free trials, and here are some of the top-rated products:
bqool claims to offer five-minute accelerated repricing, and delivers useful statistics in the process.
appeagle is a favorite among reviewers.
RePrice It offers a volume-based fee for service.
ChannelMAX has a nifty feature that imports your product list directly to its program for faster response time.
Take your time and research each for a good fit. Your business is unique to you, and may have components that work better with some vendors than others. But considering the ecommerce universe is often based as heavily on price as it is on convenience, you may be sabotaging your own success if you fail to keep up.