82% of consumers consider price an important factor in purchasing products on Amazon. Price is a key factor influencing product choice and consumer engagement. According to Amazon, you can list your product at any price, regardless of Amazon’s price or list price, as long as it’s within the limits set by Amazon and your price meets the equivalent requirements of the selling agreement.
So what aspects do we need to consider when pricing our products, and what aspects do we base the pricing on?
1. Cost
This is one of the first expenses a seller should consider. The production cost of a product includes raw materials, research and development, manufacturing, transportation, and factory profits. If sellers make improvements or micro-innovations to their products in order to ensure quality, costs will also increase. For non-factory sellers, the cost is the daily purchase price.
2. Platform monthly rent and commission
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. Sellers often include this part of the fee in product pricing, and ultimately consumers pay for it.
3. Market supply and demand
Market demand has a significant impact on product prices. When the market is chasing after a new product, causing it to be in short supply, its price will also increase accordingly. However, when products are distributed in large quantities by merchants online and offline, buyers' choices become diversified, sellers' profits are diluted, and prices are also affected.
4. Shipping costs
The transportation cost from the time products leave the factory to the time they are sold online is 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.
5. Brand positioning
Product brand positioning is different, and price positioning is also different. Brands that target the low-end market will have lower prices; brands that target the mid-end market will have moderate prices; and brands that target the high-end market will have higher prices.
6. Promotional festivals
Amazon has Prime Day in mid-July, and “Black Friday” and Christmas sales in the second half of the year. Whenever these holidays come around, Amazon makes massive price adjustments to boost sales.
7. Competitor Prices
When setting your product prices, don’t forget to check your competitors’ product prices and its historical sales prices. It is recommended that the price should not be too different from that of competitors.
This is the end of the knowledge about Amazon pricing in this issue. If you want to get more information about Amazon pricing, please pay attention and we will continue to answer you~
