Why is it Important to Track Amazon’s Prices?
July 12, 2018
Brands and retailers now look for many different channels to sell their products. Online, you can sell from your own website, your reseller websites, and through common marketplaces like Amazon and EBay. Watching prices on Amazon and reacting quickly to competitor moves is vital to stay ahead in the field.
The Amazon Marketplace
Amazon is now a global marketplace, with millions of retailers selling their products through it. Selling on Amazon enables you to access a huge customer base already in place and growing each day.
Why Do You Need To Watch Amazon Prices?
Amazon is a customer-centric business. They attract and grow their customer base by offering more benefits to them – wider product choices, best prices, fast delivery, purchase protection and so on. So while brands and retailers reach a large marketplace through Amazon, they also face a lot of competition.
Map Monitoring for Brands
Product manufacturers invest a lot in building their brand and offer unique value to their customers and also to their retail network. One of the ways they ensure fair competition among retailers is by issuing a Minimum Advertised Price (MAP) for each of their products. While special discount prices might be exempt from this recommended minimum, resellers have to stay MAP compliant in their regular pricing.
However, on Amazon, many sellers – authorized resellers or otherwise – undercut prices to stay competitive. Constant lowering of pricing much below MAP undermines the brand image. Customers then begin to feel that the MAP compliant prices are too inflated and look for very low prices or switch brands.
Map monitoring enables brands to track down MAP violators and take appropriate actions against them. This may not completely eliminate price undercutting, but it can bring it under control. This also helps improve brand-reseller relationship, showing that the brand is committed to ensuring a level playing field for all their resellers.
Map Monitoring for Retailers
To stay ahead on Amazon, resellers are always trying to capture the coveted Buy Box.
The Buy Box
The Buy Box on Amazon is the Add to Cart button on product pages. When you click this, the sale automatically goes to the seller who has won the BuyBox of the product for that time. Amazon has a complex algorithm to choose resellers as the default sellers for the Add to Cart buttons. Amazon regularly rotates the Buy Box sellers, so there is always fierce competition for the slot.
Price is a vital element considered in the Amazon Buy Box algorithm. So, you have to constantly watch the competitor prices and keep making frequent changes to stay visible.
Amazon Repricers are software components that track competitor prices for same and similar products.
Intelligence Node Amazon Repricer
Good Amazon Repricers like Intelligence Node’s 360°Pricing Amazon repricer solution offers more than just price tracking. It also tracks other vital elements that influence Amazon’s Buy Box selection. These include factors like fast delivery, time of day, brand value, product reviews, number of sellers for the same or similar products and so on.
While price tracking for exact product matches can help, tracking for similar products provides more data to work with and much better information for good price decisions. For instance, exact matching may look for the exact same color or material, but similar product tracking also follows prices for different shades, different materials etc.
Increased Chances of Winning the Buy Box Race
Taking into account many factors like pricing for same and similar products, number of competitors, customer service and delivery options etc., enables you to balance pricing with quality of service. For instance, you may have a higher price tag than another reseller for the same product, but your delivery system – speed, cost, safe delivery, product replacement for in-transit damages etc. – might increase your chances of winning the Buy Box race.
If you win the Buy Box once, you have increased your chances of winning it again as long as you maintain your pricing and quality of customer service. Buy Box increases your visibility and in retail, whether online or offline, being seen and being considered trustworthy by customers is going to put you ahead in the race for sales.
Map monitoring can also help you limit your repricing to stay compliant with the MAP recommendations of the brands you sell. This ensures that the brand perceives you as a good partner and offers the best support for you. This includes putting you in front for selling their bestsellers, for trying out new products, and taking back products that do not perform well in the market.