Most consumers consider price as an important factor in purchasing products on Amazon. Price is a key factor influencing product choice and consumer engagement, but it is one variable among many that should be monitored regularly to achieve and maintain strong business performance.
How to set pricing on Amazon?
1. New product launch period
When a seller's product is first put on the shelves, there are no good reviews, no star ratings, and the product is not competitive. At this time, in order to quickly enter the market, sellers may wish to set a lower price. Of course, the price cannot be underestimated, and you must ensure that you have a certain profit.
2. Product growth stage
The seller's products have seen certain improvements in sales volume, positive reviews, and star ratings, and sales volume is steadily increasing. At this time, the seller can raise the price slightly. Or keep your price slightly lower than your competitors.
3. Product maturity
When product sales have become stable, and indicators such as ranking, traffic, star rating, and sales volume are all very good, the seller can set the price slightly higher than the market average.
4. Product decline
After a product has become popular in the market, it will slowly enter a period of decline. Market demand will gradually weaken, and sales and profits will be much lower than before. Then there is no need for sellers to continue to push this product. If there is still stock, you can clear it out.
What factors influence seller pricing?
1. Product cost
For sellers who have the ability to develop products under their own brands, product costs include costs of raw materials, research and development, production, labor, etc. The cost of producing high-end, high-quality products is much higher than that of producing low-end, average-quality products. If you just move the goods and put them on the shelves for sale, the product cost only needs to be considered based on the purchase price.
2. Competitors’ prices
There are tens of thousands of sellers on the Amazon platform. As the saying goes, only by knowing yourself and your enemy can you win every battle. Sometimes the prices of competitors will also serve as a reference for the pricing of products of fellow sellers.
3. Monthly rent and commission of the platform
If you sell products on the Amazon platform in the name of a professional seller, in addition to paying monthly rent, Amazon will charge different commissions based on the different categories of products sold by the seller.
4. Freight
The transportation costs from purchasing products domestically to selling them online are not small and will also affect the selling price of the products. If the seller chooses Amazon FBA to ship the goods, FBA first-leg transportation fees and FBA storage fees will also be incurred.
This is the end of the introduction to Amazon pricing in this issue. If you want to get more information about Amazon pricing, please pay attention and we will continue to answer your questions~
