Pricing is a critical element in selling on Amazon. It’s one of the main factors customers consider when choosing which seller to buy from. It also greatly affects the chances of winning the Buy Box.
First, you must understand the difference between item price and total price. Item price is the cost of a product only – this does not include shipping costs or any other factors that may affect the total price.
Total price, or landed price, is what the customer pays at the end of the purchasing process. The total price includes shipping and handling charges, discounts, rebates or special sales/promotions, low-price guarantees, and any other order-related fees or expenses.
- Repricing Ideal for undercutting the competition. Commonly used by retailers to match up to competitors. However, this is not a sustainable strategy in most cases.
- Buy Box Getting to the Buy Box takes time and patience. Price is not the only consideration; it requires a good sales rating, too.
- Value-based pricing Recommended for private labels. The product’s price is determined by what customers might expect to pay. Conduct thorough market research prior to launching any product to fully understand what the ideal price could be.
Need help with Amazon pricing strategies? Book a call with us today.