Amazon Pricing Strategies with Paulina Masson - a podcast by Michael Veazey

Amazon Pricing Strategies with Paulina Masson of Shopkeeper.com 

How does using an app like Shopkeeper.com for Amazon pricing strategies fit into your overall e-commerce strategy?

Amazon Pricing Strategies and managing cashflow - you have to decide strategically, especially cashflow.

Background

Software developer - looking for tools to make life easier.



As entrepreneur it’s nice to stick to creative, best outsource or automate repetitive tasks.



Did lots of online marketing, affiliate marketing etc.



PM Amazon seller from 3 years ago



Interested in profit etc.



Has own app “Shopkeeper” like Fetcher, Helloprofit



But Geared to non-technical users

Tell us about Amazon Pricing Strategies

Paulina has been interested in pricing for a long time.



Pricing is critical for the whole business



You could maximise out of 10 products just on pricing strategies.

Pricing psychology & practical things in Amazon FBA seller central

E.g split testing and add-on items

Practical Amazon pricing strategies in Seller Central

Free Shipping threshold

Every marketplace has a threshold for non-Prime users.



Eg USA $25, UK £20



PM recommends look at product range - products below threshold eg $21 - $25.99

Results



* $4 extra profit (most products $30 sales price, make $10 so $4 is huge)

* Consumer has free shipping but will pay LESS - $21=$26.50; instead, they pay $25.99

* In search results “free shipping” checkbox - highly used feature on Amazon



Most people don’t use coupons as part of Amazon pricing strategies

They’ve been available on .com for a long time



Recently in the UK/Europe. Used to be only Promo codes - 10%



You get a green tag



Most sellers are not doing it, even advanced sellers

Benefits of using Amazon coupons



* Personalisation - buyers only look at it from a personal perspective - me me me



“Coupon sharing box” - 20% off - click - “coupon applied”



“I got something for free” - a little excitement



A little more stickiness to listing



Amounts - why $3 off etc.

How to decide on pricing

We generally charge around what we personally would pay the most, eg $30 for a knife sharpener.



This is the worst way to decide your price.



You are in a box created by your own financial limitations.



There are people who would pay $38 without thinking.



Base your price only on the marketplace



You want to decide your positioning, e.g., be a luxury brand in a cheap market.



Maybe everyone is similar - be different.

Don’t base the decision on a snapshot of today

Eg Jungle Scout - eg $15,16,17 - I’ll charge $14



Look out for promos and season



Look at tools that show the history of the price of the top competitors

Deciding between cheaper and more expensive ones

Eg Paulian’s brother is a methodical buyer - uses tools, compares products on different sites - waits for a week.



Paulina is a spontaneous buyer - if it’s under $200, she just uses the front page of Amazon.



This probably 40% of buyers on Amazon.



It’s not a generalised thing - it’s specific to price point and buying behaviour.



Amazon attracts an audience that is methodical buyers

Further episodes of Amazing FBA Amazon and ECommerce Podcast, for Amazon Private Label Sellers, Shopify, Magento or Woocommerce business owners, and other e-commerce sellers and digital entrepreneurs.

Further podcasts by Michael Veazey

Website of Michael Veazey