Automation is something we should all be thinking about. In just the past year, 66% of business industries were already piloting solutions to automate at least one business process, and analyst firm Gartner predicts that 69% of all managerial work will be automated by 2024. For business owners worldwide, this means that the daily operations of running a business are changing to become more technology-led solutions that rely on artificial intelligence (AI) to help automate repetitive or redundant tasks.
Thanks to these changes, businesses today understand the power of automation and have implemented it to help transform processes, making operations more efficient and streamlined. For many, particularly in the eCommerce industry, automation isn’t a threat; it’s a benefit. By employing automation, eCommerce businesses can boost productivity by making processes faster and more streamlined. Tasks that once took time to carry out manually can now be automated to increase speed and efficiency.
For eCommerce sellers on the Amazon marketplace, automation has particularly been a game changer. It’s given sellers more power over their inventory, their marketing and has helped provide strategies for increasing overall sales volume. One key area where automation plays an essential role in eCommerce is in repricing. Today’s repricing software does so much more than simply automate the setting of prices; it plays a key role in optimising the overall real-time eCommerce customer experience.
With the availability of intelligent, tailor-made repricing software, such as eDesk’s RepricerExpress, Amazon sellers now have software options that are more ubiquitous and responsive than ever. Today’s repricing software uses sophisticated technology to set your prices to ensure that they keep up with market demand in real-time. This helps keep Amazon sellers competitive and more attractive to potential customers.
To provide an overview of how your eCommerce business can use the AI and automation of repricing software to optimize your eCommerce business for profitability, we’ve gathered five key hacks that your business can implement to get the most out of the software.
Read on to find out how implementing the right repricing tools can be the change your business needs to transform profits in 2022.
Before launching into our hacks for how to maximise the potential of repricing software, let’s take a minute to review what repricing software does and how it helps today’s eCommerce sellers on Amazon.
With many sellers offering similar items, it can be challenging to stand out from the competition on the world’s most popular marketplace. This is where repricing software shines. It allows you to win against your competitors by scouring marketplace prices for similar products and ensuring that your pricing stays competitive against those products in real-time.
For example, imagine you are selling pet products. Your competitors sell similar pet products, perhaps even products made in the same factory overseas. To ensure that customers browsing for pet products choose your products over your competitors, you must ensure that your prices aren’t higher than that of the competition. Rather than investing in the manpower it would take to monitor this manually, repricing software takes the guesswork out by running in the background and adjusting your pricing to meet and compete with the competition in real-time.
Because repricing software is automated, it will automatically adjust for factors that affect market conditions and create scarcity, such as the supply chain issues taking place around the world. For example, should pet products suddenly become scarce due to factories closing overseas, thus affecting the supply of pet products to European markets, this will be reflected in the market. Repricing software will automatically incorporate such changed market conditions into its sophisticated algorithm, ensuring that your pricing rises accordingly, along with that of your competitors.
It’s important to note that repricing software isn’t a race to the bottom. Fears that it exists only to undercut competitors’ prices are unfounded; the software’s algorithm allows control by its user (the eCommerce seller) to set pricing floors and ceilings, and this is set against the market at large. It also allows users to filter by competitor, seller rating, feedback, shipping country and dispatch time - all factors that go into setting a correct price. These ‘checks’ in the system create an environment where your business can remain competitive without compromising its profit margins or brand perception.
As it helps your business stay competitive, repricing software also makes it more likely that your business will win the Amazon Buy Box. For many sellers, that factor is a reason to invest in repricing software.
Now, here are five ways that you can use repricing software to maximize your edge over competitors.
When it comes to repricing, being aware of what the competition is doing and staying one step ahead is the name of the game. However, there’s more to this than just pricing. A competitor’s fulfillment method and seller metrics are also important factors in the repricing recipe, as both are considered by Amazon’s algorithm when it comes to awarding the Buy Box.
The Buy Box is awarded to not just those with the lowest prices but also those with the best customer experience, as determined by reviews, fulfilment method, and overall customer satisfaction. In terms of fulfilment, it’s important to note that FBA (‘fulfilment by Amazon’) sellers get priority for the Buy Box. Therefore, if you’re an FBA seller but your competitor isn’t, you can set your price higher and still capture the Buy Box while gaining a competitive profit advantage over your competitors.
Therefore, it’s essential to pay attention to factors like fulfilment and ratings when setting prices against your competitors. Repricing software helps automate these processes while giving you control over your own parameters so that you can set the most competitive pricing automation against your competitors.
As every eCommerce seller knows, holiday shopping times are peak sales times. Big holidays like Christmas, Mother’s Day, and Father’s Day are all key times in the calendar year when sellers can add special promotions to their repricing formulas to stay ahead of the competition.
However, many sellers fail to offer similar deals during more minor holidays to help increase conversion. This is a missed opportunity; smaller holidays that pop up throughout the calendar year, such as Valentine’s Day, Bonfire Night or St Patrick’s Day, can be reason enough to offer special deals into your repricing software. Doing so will help in uplifting sales velocity.
Factors that affect your Amazon sales volume include:
● Number of leads
● Average sales size
● Conversion rate
● Sales cycle length
Keeping these factors in mind, running promotions can be advantageous to businesses looking to uplift their sales while remaining competitive and on the right side of Amazon’s seller rules. Updating your repricing formulas and rules to incorporate deals and promotions throughout the calendar year is a good use of repricing software’s smart automation and makes the most of the technology at your fingertips.
While it’s true that repricing software takes the guesswork out of price competition, its AI-driven solution is only as useful as the strategy of the human putting it to work. Simply stated, to get the best results from repricing, you must know how to implement it well.
It can be tempting to add all the products in your catalogue into your repricing software on Amazon marketplace at once. However, this is not the right approach when starting out with repricing software. While that might sound controversial, here’s why: to hedge your bets against margin loss when starting out, Amazon product pricing should be limited to a particular set of products.
Before you deploy repricing across the entirety of your product catalogue, start by limiting it only to a specific product line. Set up your parameters, and then let the software do its automated magic. You will then be able to see exactly how the line is performing compared to other product lines you are selling and can use the insights you gain from this ‘test line’ to support your strategy for other product lines.
By starting with a test line and tweaking the software as you go along, the insights you collect will empower you to apply best practices to your other products over time. You’ll become an expert at using repricing software while minimising any potential loss incurred during the onboarding process.
It can be easy to have a ‘set it and forget it’ attitude when using automated products, but at the end of the day, the seller is the mastermind in control of the sophisticated AI technology. Understanding your own sales volume and using this understanding to optimize how you program your repricing software to price your products will give you a strategic edge over the competition.
Understanding your sales volume is crucial to this process because knowing which items are hot sellers (and at which times) will help you set the correct prices on those products against those of competitors. Hot selling items at key buying periods (e.g., holidays) should be inflated to maximise profit, whereas items moving slowly should be discounted accordingly to move them through the pipeline more effectively. Using repricing software, you can set specific pricing actions to happen automatically when specific volume thresholds are met. This will allow you to get the edge on profitability in real-time.
Taking an eagle-eyed look at your sales volume allows you not only to understand your business better but also gives you the knowledge to be able to get the most out of your repricing software so that you can be the mastermind behind your own profit opportunities with regards to pricing. Once you know how you want to price your products for the most advantageous potential outcome, the repricing software will automate the rest.
Repricing happens in real-time, meaning you need to act swiftly on insights gained from activities that take place dynamically within the marketplace. New Amazon sellers crop up daily, and new products are constantly added. The Buy Box rotates frequently, and Amazon often introduces new rules to meet new demands and solve new problems. The only constant in selling on Amazon is that change is inevitable. That’s why, as a seller, you must comprehend and be able to respond without hesitation to remain competitive.
Amazon sellers must maintain the greatest flexibility - especially when it comes to repricing. Rolling with the punches and learning from mistakes is invaluable, as is applying lessons learned. There will be times when revenue is lost due to undercutting pricing, but also times when the gain is significant. Margins will hopefully balance themselves out at the end of the day; however, by paying attention to the different outcomes, you can start to observe patterns and hone your repricing skills, which enable mastery of your repricing software.
As you can see, repricing is not just about setting values and sitting back passively, letting the AI do the rest of the work. A comprehensive amount of strategy behind the scenes goes into getting the formula right. When you go into repricing on Amazon with a strategy and some know-how, your software will be your perfect partner for getting ahead of the competition every time.
We’ve been helping eCommerce brands with anything from 200 to 6 million SKUs to sell more at higher profits for over a decade.
With around 70 million active SKUs, our serverless solution can process limitless amounts of automated repricing events every second, so your business can scale in line growth and at peak times with confidence. Last month, we processed 8 billion repricing events - that’s 2,663 events per second!
As proud members of the Amazon Developer Council, we seamlessly integrate with over 50 marketplaces, webstores, and inventory platforms so you can automatically replicate consistent pricing in real-time everywhere you sell.
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