The Most Successful Amazon Repricing Strategies for Wholesale and Brands
(Last updated on October 31, 2022) The automated adjustment of product prices has become common among Amazon sellers. Especially sought-after wholesale products can hardly be successfully sold on various marketplaces without a repricing tool. However, the performance of Private Label products is also increasingly supported by a repricer. This raises the question of whether sellers can use their repricing tool for Private Labels in the same way they do for their wholesale products.
No, of course not.
This is primarily due to how Amazon sorts products on its marketplaces. Instead of creating a separate product detail page for each offer, Amazon consolidates offers from different sellers of the same product onto a single product detail page. When a customer makes a purchase, only the seller with the best offer at that moment receives the sale and wins the Buy Box.
Who wins the Buy Box is calculated by the algorithm in the background repeatedly. Key factors include shipping time and price. Since the latter can be influenced quite effectively, price adjustment has become an established practice that sellers use to try to win the Buy Box and thus capture as many sales as possible.
The Small but Significant Difference
This all applies particularly to wholesale products, which are characterized by multiple sellers offering the same product. Typically, these are goods from larger brands, such as electric toothbrushes from Oral-B. However, the situation is somewhat different for Private Labels. These are usually offered by only one seller, who is typically the brand owner. As long as this seller does not sell any of the products to other retailers, they are the only offer on the product’s listing and therefore automatically have the Buy Box in most cases.
Well, no competition = no benefit for a repricer. Right? Not quite. While the competition may no longer take place on the listing, it does occur between different listings of similar products, such as leather dog leashes from the brand HältGut and from the brand LäuftGut. Both receive a separate listing but compete for the purchasing willingness of Amazon customers as well as for a good ranking within the search results in Amazon search. In addition to search engine optimization, price is again an important factor in whether a product listing appears at the top of the search results or sinks quietly into the depths of Amazon.
How can a repricer effectively support price adjustments for both wholesale products and private labels?
Strategies Compared: Optimization for the Buy Box, Cross-Product, Sales, and Time-Based Strategies
In the following, we would like to introduce you to three strategies that the SELLERLOGIC Repricer offers, which are available to every customer at no additional cost. These can be applied to both individual products and product groups.
#1: Buy Box Optimization
The fact is: 90 percent of all sales occur through the Buy Box. Whoever owns the Buy Box captures the majority of sales, making the Buy Box strategy the cornerstone for all sellers of wholesale products. However, the unique aspect of the SELLERLOGIC Repricer is that it does not solely rely on the lowest price to win the Buy Box. Once this goal is achieved, the tool does not stop optimizing; instead, it works to raise the price again to maintain the Buy Box at the highest possible price. This way, sellers not only sell more but also at higher prices and with higher margins.
By the way: Through the approach of the SELLERLOGIC Repricer, even the Amazon-internal price range assigned to each product based on the set offer prices can increase. This price range regulates, for example, how high or low an offer can be priced to qualify for the Buy Box. This means that using a repricer can help raise the price of a product overall.
#2: Cross-Product Strategy
The purchasing decisions of Amazon customers are heavily influenced by the product price. When similar products are offered by other sellers – which is usually the case – it makes sense for manufacturers and private label sellers to conduct a price comparison and make corresponding price adjustments. This ensures that the product price remains attractive, leading to higher sales and better ranking in Amazon search.
With the cross-product strategy from SELLERLOGIC, a selected product can be compared with up to 20 similar competitive products, and the price can be adjusted accordingly. Sellers specify which products to compare based on the ASIN and set the price margins to the referenced products. The repricer then regularly checks the competitive prices and makes price adjustments if necessary.
The application of the cross-product strategy not only ensures attractive pricing but also prevents excessively low pricing and the associated margin losses.
#3: Sales and Time-Based Strategies
Through push optimization, sellers can adjust their prices based on the number of units sold. Especially private label sellers need to be able to manage their selling prices over a longer period to influence the demand for a product.
For example: If sales figures increase, the price can be gradually raised based on this increase, such as by five percent for every 30 units sold. Different rules can also be combined, such that the price increase is proportionally higher the more items of a product have already been sold. Conversely, the opposite case can also be established: after X units sold, the price decreases by Y percentage points.
The Daily Push Optimization is also based on sales figures; however, the product price is reset to a predetermined starting price daily at midnight or at a desired time. This allows sellers, for example, to offer the desired minimum quantity at a reduced price at the start of the day and then raise the price afterward.
#4: Manual Strategy
Every Amazon business is different, and a good repricing tool should be flexible enough to accommodate this individuality. Private label sellers and wholesalers alike benefit from such optimization. With the SELLERLOGIC Repricer, users can target the lowest-priced competitors, those defined in the “whitelist,” or any other competitors not excluded by the “blacklist.”
Many different factors can be included:
Conclusion: Repricing for Wholesale and Private Labels
Repricing is not a matter of product type; it works for both wholesale and private labels (manufacturers). However, there are some differences to consider, as it is of little use to optimize for the Buy Box when selling your own private label product.
Wholesale sellers, on the other hand, are well-advised to optimize for the Buy Box, either fully automated or individually set. Cross-product, time-based, and quantity-based strategies are more suitable for products offered by only one seller.
In any case, marketplace sellers should ensure that they use a dynamic repricer that also raises prices instead of just lowering them, to prevent a price decline.
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