How to beat Amazon with your Pricing Strategy!

Gepost op 29 January door Andrea Magossi in E-Commerce


Are you an e-commerce owner struggling to beat Amazon's competition with your products’ prices?  

Read the following article and discover how to beat amazon on pricing!

It's not a secret that 80% of e-commerce have to deal with the competition of the biggest marketplace in the world.

As reported by Statista, in 2019 Amazon’s net revenue amounted to 280 billion U.S. dollars, with a NET income of 11.59bn USD obtained predominantly in the retail sector.

Source: https://www.statista.com/statistics/266282/annual-net-revenue-of-amazoncom/ 

Source: https://www.statista.com/statistics/266289/net-revenue-of-amazon-by-region/ 

The advent of Amazon in the retail market has irremediably changed the online prices' landscape. Until 2008, the prices of products for web-shops changed on average 2 to 4 times a year. Today, given the amazon pricing policies, for which is estimated that the items' prices are updated every 10 minutes, there is the need for e-commerce managers to apply recurring changes on the prices of their online offers.

Nowadays, the Bezos's platform sells almost any category of product; In one of the latest news, the American giant revealed their upcoming opening to the US drug market.

As reported by Investopedia: "Amazon Prime members will receive discounts of up to 80% on generic drugs and 40% on brand-name drugs, if they forgo using insurance."

In 2019, Amazon opened up also in the Netherlands, where it could operate an aggressive downward pricing strategy against the two main marketplaces in the Dutch market Bol.com and Coolblue.

On Amazon, the most common products' categories are listed with an average price of 7% to 9% cheaper than the same products on Bol.com and Mediamarkt.

So here the recurrent question, how to win the price competition against the colossus of bargain prices?

Let's see 6 easy ways to beat Amazon on Pricing:

1- Scrap Amazon Products' prices.

2- Import competitors' prices list within a click.

3- Get automated reports on competitors' insights on Amazon.

4- Get a detailed overview of your competitors selling your same products on Amazon.

5- Set-up a Dynamic Pricing Tool for Amazon.

6- Follow Amazon's selling strategies for your e-commerce.

 

1- It is not currently possible to manually export any product data from Amazon to a spreadsheet.

Yes, this concern also prices!

This means that this action must be carried out in the backend through the use of Scraping software. Through PriceTweakers we can scrape any product price from an Amazon Shop and show it in the hour user interface. You can also use the price in your strategy.

 

2- The price fluctuations of online products have grown exponentially in recent years. As previously mentioned, in congruence with the advent of Amazon there has been a real price revolution in the eCommerce market.

Today, webshop owners can no longer afford to keep the prices of their products stable for long periods. It is the task of every e-commerce specialist to regularly monitor the competitors' prices and optimize the offers of their inventory.

True is, that in case you have a long catalog, this can be a real nightmare!

Let's face it, analyze in detail all the price changes, x the number of competitors and products; In the end, managing and executing your pricing strategy would be an enormous job.

Through monitoring software like PriceTweakers, you can automate this awful process making price monitoring and inventory pricing updates an easy joke.

 

3- Data is gold for the digital market.

Having consistently updated insight it's extremely important for an online business.

Within a market in constant mutation, being able to access any kind of competitors' data on Amazon, it's an enormous advantage over your competitors.

Inside the PriceTweakers dashboard, you can quickly get stock availability insights of any Amazon shop.

 

4- One of the main tasks for a webshop consists of constantly monitoring who else is selling the same product online and at which price.

Keeping track of new competitors joining the market, have to be one of the activities in the "to-do list" of any e-commerce specialist.

Throughout the PriceTweakers platform, you will gain full control to analyze any new player with an Amazon's inventory related to yours.

 

5- With the online retail market constantly changing the prices of the products offered, it's important for e-commerce managers to set automated strategies in reaction to competitors' price variations in order to gain a competitive advantage.

As reported by Business Insider Amazon changes product prices 2.5 million times a day, meaning that an average product listed on Amazon changes prices every 10 minutes.

A Dynamic Pricing tool is an essential component of any e-commerce that wants to position its market offers in a winning way.

Webshops can set flexible rules according to the circumstances in the market. The determinants may differ in relation to the needs and goals of the business.

The most common elements characterizing product price variations are:

Product Price in Big Marketplace.

Historical Product Prices.

High demand seasons.

Future demand estimate.

Inventory Stocks amount.

Product value perceptions.

The Pricetweakers Dynamic Pricing (DRS) is an additional module within PriceTweakers that allows you to save time and money, increase the margin, and achieve steady growth.

By making an API connection with your custom-made CMS system or with one of the well-known CMS systems, the prices of all products, categories, or brands can be implemented automatically using extensive price rules. Within DRS you have access to more than 30 different price rules and the associated functionalities, which makes it possible for every webshop to make the right price strategy and implement it automatically in your CMS.

You also have access to a real-time analytics reports that give you immediate insight into whether you have deployed the right strategy or whether you need to make adjustments, so you do not have to wait days to see the direct results. This saves you or the company a lot of time so that you can focus on other important matters within the company.

 

6- Amazon is the big shark in the retail market. Each price movement profoundly affects the stability of the offers in the referred market niche.

For this reason, fighting against this huge player, it's extremely difficult. It's better following its steps.

Let's see which tactics are used on Amazon to sell items at bargain prices while still making a profit.

Is it ever happen to you to go to Amazon for buying a device and you end up buying the device plus the other three connected accessories?

Often Amazon makes the most profit on related accessories, so it can offer the main item at a very low price.

By showing related accessories, during the checkout, you will increase your revenue and profit margin.

Comparing three offers on a price scale for similar products will increase the perceived value in the user's mind towards the intermediate offer, as the offer at too low cost will be seen as low quality.

The FOMO (Fear of Missing Out) it's a widely used marketing tactic; it's been proven that our brain gets stressed when it risks losing a possible offer.

That's why countdown offers can have a strong impact on your eCommerce sales.

These are just some of the most commons strategies applied in the Amazon marketplace that you could successfully follow.

As highlighted in this article, the online price war is now more heated than ever.

More and more web stores are selling the same products; moreover, the product's offer available on Amazon is expanding day by day. The competition is stronger than ever but the price war can still be won by an eCommerce that follows the right pricing strategy!

 

#amazonprices #amazonpricestrategy #amazonmarketplace #amazonshops #amazonpricing 

 

 

SOURCES: 

https://www.statista.com/topics/846/amazon/  

https://www.investopedia.com/the-impact-of-amazon-pharmacy-on-u-s-healthcare-5089736#:~:text=Amazon%20has%20launched%20a%20new,if%20they%20forgo%20using%20insurance. 

https://www.netohq.com/blog/how-to-price-for-amazon-australia 

https://www.bigcommerce.com/blog/amazon-pricing-strategy/ 

https://www.mytotalretail.com/article/4-pricing-strategies-help-you-beat-amazon-this-holiday-season/ 

https://www.businessinsider.com/amazon-price-changes-2018-8#:~:text=might%20just%20change.-,Amazon%20changes%20product%20prices%202.5%20million%20times%20a%20day%2C%20meaning,than%20Walmart%20and%20Best%20Buy!&text=Amazon%20has%20one%20billion%20gigabytes%20of%20data%20on%20their%20items%20and%20users. 


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