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Top 3 Repricing Techniques for Retailers and Brand Owners

  It makes sense to use a tool to modify your product prices to reflect the state of the market. Software is better at setting prices than...


Best Wholesale Strategy for Winning the Buy Box

It makes sense to use a tool to modify your product prices to reflect the state of the market. Software is better at setting prices than humans are, and neither do business owners have the time to monitor and analyze the hundreds of price changes that occur each day for each particular product and alter prices accordingly.


However, if you intend to employ a repricer, you must consider the best method for price adjustment. This primarily depends on the kind of goods that an Amazon marketplace vendor offers:


Items from established brands that are resold by a third party are referred to as wholesale. Success is determined by whether the seller's offer secures the Buy Box on the product detail page.


On the other hand, the owner of a brand sells products when it comes to private labels or brands. Here, the listing's position in the Amazon search results is more significant than the Buy Box.

As a result, different pricing tactics should be used by vendors. Based on specific use scenarios, we will demonstrate which solutions are appropriate in the sections that follow.


The Best Wholesale Strategy for Winning the Buy Box

Buy Box

Only a small minority of customers even know that there is a second "box" that displays additional sellers further down on the product page, which accounts for about 90% of conversions on Amazon's product detail pages. In line with this, there is fierce competition for the little yellow box, especially when selling wholesale.


The product price, along with a few other considerations, is the primary deciding factor for receiving the Buy Box. A dynamic repricer does not only consider the lowest price, in contrast to conventional, static repricing tools.


The price is raised by the clever algorithm as it continuously assesses the state of the market, either until the maximum price is reached or the presumption of holding the Buy Box prevents further price increases.


Example of the Buy Box Strategy in Action

A crucial idea in e-commerce, particularly on sites like Amazon, is the "Buy Box" technique. This tactic allows numerous vendors to list the same goods on a platform, but only one seller's offer will be prominently displayed alongside the "Add to Cart" or "Buy Now" button on the product page. Customers can buy the product straight from that seller without checking other offers after this seller is declared to "win" the Buy Box.


Here is an illustration of how to use the Buy Box tactic:


Scenario: Selling Electronics on Amazon

Consider yourself a retailer who sells expensive headphones on Amazon. The identical brand and style of headphones are also sold by a number of different merchants. Because most buyers choose to click on the seller listed in the Buy Box as their default option, obtaining the Buy Box for this goods is essential. Here is an example of how you could use the Buy Box tactic:


Competitive Pricing: Pricing is one of the most important criteria in obtaining the Buy Box. The algorithm used by Amazon takes into account both the total value provided to customers and the price of the product, including shipping. To effectively compete, you must make sure that your pricing is reasonable compared to that of other retailers selling the same item.


Fulfillment Method: Fulfillment that is dependable and effective is highly valued by Amazon. You're likely to have a better chance of winning the Buy Box if you use Amazon's Fulfillment by Amazon (FBA) service, where Amazon stores, picks, packs, and ships your products. This is so that Amazon can satisfy customer expectations since it believes in its own fulfillment system.


Shipping and Delivery Times: Winning the Buy Box also depends on the promptness and dependability of your shipping. Providing quick and precise delivery alternatives might help business gain an edge.


Product Condition and Quality: It is essential that the item you are selling is of the highest caliber and truthfully described in your description. Your chances of winning the Buy Box can be harmed by unfavorable customer reviews and refunds as a result of misrepresentation.


Seller Performance Metrics: Measures of seller performance that Amazon takes into account include order fault rates, cancellation rates, and late shipment rates. To obtain and keep the Buy Box, sellers must maintain strong seller performance metrics.


Inventory accessibility: It's crucial to keep your merchandise on hand. Your listing for the Buy Box may not be given preference by Amazon's algorithm if your product frequently runs out of stock.


Positive Customer Feedback: Positive customer feedback can increase your chances of winning the Buy Box. Positive reviews show Amazon that you're giving customers a satisfying experience.


In this case, you improve your chances of getting the Buy Box for the headphones you're selling by concentrating on competitive pricing, utilizing Amazon's FBA service, guaranteeing quick shipping, maintaining high-quality products, meeting seller performance metrics, and obtaining positive customer feedback. 

This implies that customers are more likely to discover your offer and make a purchase when looking for particular headphones, resulting in higher sales.


Top Strategies for Brands for Increasing Sales and Ranking

Not all Amazon sellers, meanwhile, provide fiercely priced wholesale goods. Therefore, it would be pointless to push the Buy Box for less well-known companies with only one seller or even private labels since this is typically already achieved without price optimization. Sellers should instead focus on increasing their own sales numbers.


Sales-based Approach

Every day at 0:00, the repricer begins with a predefined beginning value, such as the lowest price. If sales rise, the price might be raised gradually in accordance with the rise, for instance by 3% for every 50 units sold.


Combine diverse tactics for an even better outcome, such as the fact that the price rise is greater in percentage terms the more units of a product have already been sold. The opposite scenario, in which the price lowers by Y percentage points after X units are sold, can also be provided.


Example 1 of Implementing a Sales-Based Strategy

Let's say a vendor sells decorative things under the brand "Roses" on Amazon, with the beginning price for floral vases being 79,99 euros. Some orders typically arrive in the morning, but the majority of the day's business is done in the evening.


After 50 units have been sold, the seller orders the repricer to reduce the price of the vase SKU by five euros. The price decreases by four euros once more following 50 more sales.


Sales are typically increased by the price reduction, which raises the product detail page's rating. The product's visibility and discoverability are noticeably better in the late afternoon when the majority of customers in this category are exploring Amazon, and sales increase. The price is once more increased at midnight, avoiding a price decrease.


Example 2 of Implementing a Sales-Based Strategy

A shrewd seller manages a standout item in the pet supplies category on Amazon: a 10-kilo bag of premium dry dog chow known for its unique protein source and organic makeup, which appeals to owners of allergic pets. The product, which had a starting price of 50 euros, has built up a solid reputation and is quite visible in Amazon's search results. The seller expertly orchestrates a rhythmic dance of pricing adjustments using a clever sales-based pricing strategy to maximize profits while preserving the product's market position. The price is purposefully increased by 10% after every 20 units sold, providing for increased profit margins during times of high demand.


However, once the 20-unit mark is again reached, the vendor carefully lowers the price by 10% to maintain competition during slower periods. This deliberate ebb and flow masterfully balances profit maximization with maintaining competitive allure. This clever tactic demonstrates the skill of a well-executed sales-based strategy as the seller skillfully increases revenue without jeopardizing the product's search visibility or customer attraction.


Time-based Approach

It is also possible to optimize the price depending on periods of high selling activity using a strategy based on day of the week, for example. However, unlike the sales-based plan, this technique can be prolonged to a time specified by the customer rather than being executed in a 24-hour rhythm. Additionally, optimization that is based on time intervals and unit counts can be coupled.

Particularly private label/brand vendors profit from having more time to manage their sales prices and affect the product's demand. When demand has been very strong over the past X days, for instance, the repricer may boost the price by a specified amount Y. He once more optimizes the price downward when demand declines.


Of course, using this tactic also makes it feasible to keep the Buy Box from disappearing by placing the checkmark in the right spot. This implies that sellers of less popular goods can also benefit from this type of optimization.


Time-based Strategy Example 1 of Application

In a different situation, our seller's product line grows to include a fresh variation of the popular mono protein dog food—this time it comes in wet canned form. However, the seller suffers a typical problem with the launch of this new listing on Amazon: initially poor visibility and findability. In order to tactically address this, the vendor adopts a time-based pricing plan that boosts profit margins while also steadily raising the status of the product.


The seller orchestrates a precisely timed repricing strategy using their preferred repricing technology when the new wet food listing takes traction. The initial plan calls for a 0.10 euro price bump after five sales, modestly boosting margins while taking into account the product's emerging position. This calculated change aids the vendor in striking a balance between the requirement to attract early adopters and profitability.


After ten sales, when the product starts to take off, the repricing mechanism initiates a 0.50 euro rise that is more noticeable. The pricing is kept within a range that appeals to potential buyers researching this new service while also taking advantage of the increased interest.


After 15 sales, the approach makes a qualitative turn and starts raising prices by 3%. This strategic action takes advantage of the product's rising market popularity and visibility to increase margins more significantly without scaring away potential customers.


The repricer orchestrates a final incremental change, raising the price by 5% after the milestone of 20 sales is reached. This daring yet strategic change recognizes the product's successful market entry, higher rating, and increased customer recognition.


The seller successfully navigates the difficulties of releasing a new product listing by using this skillfully timed time-based method. The seller maximizes profitability and the placement of the product in Amazon's search hierarchy by applying deliberate and incremental price increases based on sales milestones. This method, which skillfully employs a time-based pricing strategy, not only strengthens the bottom line but also guarantees that the product constantly develops momentum and visibility.



Time-based Strategy Example 2 of Application

In a different setting, our vendor adds a distinctive flower vase to their assortment of decorative objects. The seller, however, is unsure about the product's potential popularity due to its unique appearance. As a result, the seller adopts a strategic time-based pricing strategy, relying on the repricer's skills to negotiate these risks and achieve the best results.


The vendor uses a subtle price strategy while keeping a close eye on the performance of this new product. If sales of the flower vase don't reach ten units in a week, the repricer starts to cut the price by one euro. This quick move aims to pique curiosity and promote early adoption, realizing that a more reasonable price point might act as the ignition for early client engagement.


On the other hand, the plan calls for a price increase of one euro if more than 20 units of the product are sold. This increase reflects the product's popularity and increased demand while simultaneously boosting the margin to reflect the perceived value of the product.


The present pricing, meantime, will not change for sales of between 10 and twenty units. This tactical "hold" keeps things stable while we wait for feedback from customers and market reaction to guide future pricing decisions.


The seller skillfully handles the challenge of launching a novel product with a shaky market reception by skilfully arranging this time-based pricing approach. Due to the flexibility of the method, the seller can adjust prices in response to current sales information, creating a dynamic balance between accessibility and profitability.

When a product's appeal to clients wanes, the technique enables a prompt sell-off, freeing up resources for new interesting projects. On the other hand, if demand increases, the plan increases margins, producing a result that showcases the strategic prowess of a well applied time-based pricing method.


Final Thoughts

You don't need much more than a product to sell on Amazon. You need solid concepts, a strong work ethic, and some shrewd tools to sell well on Amazon. To change product pricing to the state of the market without sacrificing margin or profit, one needs a clever and dynamic repricer.


The proposed approaches must, however, work for the seller's own company. Brand owners should adopt sales- and time-based techniques even though buy box optimization is good for wholesale.


Read More:

By Following our Best Advice, You can Win the Amazon Buy Box in 2023.

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The Top 7 Ways to Reduce Returns on Amazon

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