One of the most effective strategies for increasing profit is repricing. This simply means adjusting the prices of your products—but if it’s done correctly, it can have powerful effects on the success and profitability of your business.
In this guide, we break down how to implement a repricing strategy.
We’ll help you understand why you should create an Amazon repricing strategy and how you can manage repricing your products. Plus, we’ll show you the five best repricing strategies for sellers.
Why you should create an Amazon repricing strategy
Selling in any market is a competitive game, but the Amazon Marketplace is one of the most fierce environments out there. To not only stay afloat but thrive in this competitive environment, sellers need to be constantly changing the prices of their products.
By anticipating fluctuating customer demand, changes in competitors’ prices, and other evolving variables, you can learn how to stay ahead of the curve to increase your sales potential and, ultimately, maximize profits.
And repricing doesn’t just help you outpace your competitors. Even if you’re the only seller of a certain product, you should still maintain repricing as an integral part of your Amazon sales strategy.
But how do you know what factors to consider when repricing your products?
Before we dive in, let’s first review two different repricing strategies: manual and AI automation.
How to manage repricing: manual vs AI automation
When it comes to figuring out how to manage your repricing strategy, there’s a lot to consider—but it all starts with deciding whether you want to reprice items manually or use an automated solution.
While managing your repricing strategy manually via Amazon Seller Central is definitely doable, it does come with some setbacks.
For one, doing all the calculations and executing the changes manually is time-consuming—and these calculations are never guaranteed to yield the best results. In most cases, by the time you finish the manual calculations and come up with your new price, the market landscape has already changed, leaving your “new” price outdated and useless.
Let’s suppose you want to figure out the new optimal price for a product. Using a manual approach, you would have to go through each of your competitors’ listings and review their product prices one by one. But even after finishing this tedious work, there’s still no way to know for sure if the new price you’ve picked is actually the right one that can best compete in the market at that precise moment.
An automated AI solution, on the other hand, can analyze millions of factors (e.g., your competitors’ prices) in real-time and find the best price for your product in seconds. And it doesn’t matter how many competitors you have. With manual calculations, at some point, there’s only so much you can manage on your own—but an AI solution can handle any number of listings and give you results in just seconds.
5 best repricing strategies for Amazon sellers
To keep their prices competitive and to best position themselves to improve their profit margins, savvy Amazon sellers turn to repricing tactics.
Check out the top five repricing strategies Amazon sellers use to ensure their product prices are primed to capture the most profits possible.
1. Compete on the search page
With most traditional repricing strategies, the focus is all about the Amazon Buy Box, i.e., the white box on the right of the page where customers click to add products to their cart.
But this doesn’t work when trying to target the modern customer.
Today, the real sales battle takes place even before you reach the product page. It starts with the search results—and winning the search results battle is key to ultimately winning the sale.
By using an automation tool to find the price that’s primed to sell, you can ensure that you’ll always win a coveted spot on the search results page. It works by optimizing important factors that you need to compete on the search page, such as:
- Optimized titles and descriptions that include the right primary and secondary keywords
- Continuous collection of new, detailed product reviews
- An optimized price that beats out all the others
2. Continue to optimize for the Buy Box
While learning how to stand out on the search results page is a big part of a successful repricing strategy, you don’t want to completely forget about the Buy Box.
If you’re an Amazon seller, the Amazon Buy Box is still a great place to be. This tells customers they can trust that your product will arrive to them on time and in good condition. For many Amazon sellers, most of their sales come from the Buy Box.
But getting the Amazon Buy Box isn’t a given—you have to put in the hard work for it.
In order to be eligible for the Buy Box, Amazon sellers must prove that they are up to the Buy Box requirements. Some of the most important ones are:
- A landed price (i.e., the base price of your product plus shipping fees) that’s competitive with other sellers in your category
- A shipping time that meets customers’ expectations
- A fulfillment method that your past customers have rated highly (e.g., Fulfilled By Amazon (FBA) is typically preferred over “merchant fulfilled”)
- A high seller rating that builds trust in potential customers
3. Move from a rule-based strategy to AI
Rule-based pricing is one of the most popular repricing strategies—but that doesn’t necessarily mean it’s one of the best.
With rule-based pricing, you manually set up a set formula of repricing rules based on different factors like competitor prices or time of day. The problem with basing your repricing strategy on rules is that you leave a lot of room for human error—and once you set these rules in place, they rarely change.
But a repricing strategy that’s founded on an AI automation tool eliminates the risks of a manual repricing process.
Because an AI automation tool pulls in billions of data points to determine optimal prices for your products, it can actually learn over time from its own experience. And as it continues to learn more about your products and the competition, it will only get better at strategizing and making optimal pricing decisions.
4. Make incremental shifts in price
While adjusting your prices at strategic times can definitely help you improve sales, make sure you don’t get too carried away looking for the minimum price or maximum prices because Amazon can actually penalize sellers who make massive shifts in their pricing.
So as you work on repricing your products, pay careful attention to the changes you’re making—and only make incremental price adjustments.
The beauty of using an AI automation tool is that it takes the worry out of the equation.
An AI automation tool is designed to optimize prices that are specifically Amazon-friendly. So if you’re an FBA seller, you don’t need to worry about whether or not your price change is too extreme.
Compared to manual repricing, this is another win for the AI automation tool; it lets you confidently maximize your profits without having to worry about hurting your rank.
5. Leverage pre-configured pricing models
AI automation tools like Profasee come with built-in preconfigured pricing models that sellers can leverage for different use cases. These models can be applied to your entire product catalog at once or individually on each SKU.
What makes these models so powerful is that they are designed based on real-time data points that are collected from your store to help you hit your unique business targets. This means you can always have confidence that the product prices determined by Profasee are custom-fit for the now and are never based on old data that’s no longer relevant.
How’s that for working smarter not harder?
Why use Profasee for your repricing strategy
Profasee’s Amazon repricing software enables FBA sellers to predict the perfect price for each of their products at each precise moment.
Our intelligent pricing algorithm analyzes millions of data points to surface real-time insights and dynamic pricing recommendations. We take into account every variable that can impact sales velocity to give you the guaranteed best prices for your products.
And the best part? You can integrate our repricing tools with your storefront’s products in just a few clicks. If you’re ready to set up your repricing strategy, request a demo to see what Profasee can do for you and your sales.