introduction
Are you an Amazon seller facing intense competition and intense price wars? Many sellers are adopting pricing strategies to drive more sales and to beat their competitors. We are keenly aware that lowering prices is a losing game. In this blog post we will discuss:
What is price competition and why is it a bad thing?
Maintain your Amazon buy box.
How to avoid price competition.
3 proven strategies to avoid Amazon price wars.
Examples of Amazon products and sellers that avoid price competition. Examples of Amazon products and sellers avoiding price wars.
How to escape from price competition!
What is price competition and why is it a bad thing?
Amazon is a competitive marketplace. Even if you sell a great product, over time your competitors will start to eclipse you. So one of the easiest ways to take a big bite out of sales is to lower your prices.
It’s easy to see why this is one of the easiest Amazon repricing strategies your competitors employ. But there are some dire consequences.
None of these results are good. Therefore, the best strategy is to maintain the buy box and avoid price competition.
Maintain Amazon Buy Box
One of the most frustrating things that can happen in a price war is the possibility of losing a coveted Amazon Buy Box position. So, not only are your competitors eating away at your profit margins, but you may also start losing sales due to lower price offers.
When you win a Buy Box on Amazon, other sellers can take over your products. If your Amazon products have been compromised, you need to act quickly to prevent further damage.read our article Amazon listing hijack Check out this article to learn how to resolve this issue.
Can improving Amazon BSR help avoid price competition?
If you want to build a sustainable Amazon business, my advice is to be customer-centric.
Additionally, Amazon recognizes outstanding sellers. customer service You’ll be rewarded with positive customer reviews and an improved Amazon Bestseller Ranking (BSR). A better Amazon BSR improves the status of your product and naturally protects you from price competition.
There are many ways Improving Amazon BSR Including using the Helium 10 Review Insights tool.
My 3 Strategies to Avoid Amazon Price Competition
It may sound counterintuitive, but Amazon FBA’s pricing strategy is to charge more.
By creatively increasing the value of your product, you can attract buyers who are willing to spend a few dollars more.
In my Amazon FBA business, I use three different strategies to create value and stay ahead of the competition.
1.
Create your own branded products that solve problems and needs. This increases customer value.
2.
Gather bulk items together. Add accessories to your main product to differentiate it from the competition.
3.
Sourcing locally made products Because products made in China still have a negative reputation. Additionally, buying locally can be a good choice for individuals as it protects local jobs.
I choose the strategy I use depending on the product, what else is sold on Amazon, and the density of competition.
pro tips: Strategies like private label sales, branded products, and unique product offers can also help protect against Amazon listing hijacking.
Makes it difficult for other Amazon sellers
Choosing one of the three strategies (listed above) automatically separates you from the pack. But more importantly, it makes it much harder for other Amazon sellers to copy my products and offers.
Other tactics I use to make it difficult for other sellers are:
When products are packaged together, all accessories are typically sent to one factory where they are assembled and packaged into a complete product. Creating this packaged offer takes time, but it slows down competitors who try to replicate what I’m doing.
We choose to sell only high-quality products with luxurious packaging.
Commission lifestyle images that highlight and highlight the main benefits of your product.
Below is an image example that shows how informative images that describe your product can help you generate more sales compared to your competitors.
Examples of branded products and sellers who avoid price competition on Amazon
I’ve put together some examples to help illustrate my point. brand Selling on Amazon continues to beat the competition by remaining customer-centric, adding value, and selling quality products.
1. Tweezers Man
A niche beauty brand focused on the highest standards of quality. Their products aren’t all that different from other sellers, but their look and feel all suggest quality that’s worth your money. Their tweezers sell for about $20, compared to other tweezers that sell for about $4.
2. BLK and bold
This is a private label coffee supplier with a strong philosophy and community mission. They have penetrated the coffee market and are growing stronger in the consumables and subscription and savings markets.
They create branded products that include great founder stories, so you can set your own pace when it comes to pricing. Instead of paying about $20 for one box of capsules, the customer agrees to pay his 50% more.
3. Nina Woof
Nina Woof sells pet accessories. They offer eco-friendly dog poop bags and target customers who are willing to pay more for eco-friendly products.
Customers who are now consciously looking for impactful products are often willing to pay more. Similar dog poop bags that don’t claim to be eco-friendly cost a few dollars less per box.
What to do to get out of a price competition situation
If you’re reading this article and thinking, “Great information, but we’re already in a price war, how can we get out of it?” So let me share a story that I heard through this site. serious seller podcast.
Bradley Sutton (host of the Serious Seller’s Podcast) launched a coffin shelf product about four years ago as part of a training series called Project X.
He successfully launched his product, but after four years of sales, he now faces intense competition and price wars. This coffin shelf previously sold for over $30, making a good profit. However, other sellers systematically lowered prices to about $20, creating a price war.
Bradley’s solution?
He decided to differentiate his product. Using the Helium 10 Reviews Insights tool, I was able to find ideas for accessories to bundle and create interesting offers.
How to use review insights to find bundle opportunities:
1.
Open your listing on Amazon. Open Review Insights using Helium 10 Xray.
2.
Go to filters and choose to only see reviews with photos.
3.
Please take a look at the images of actual lifestyles submitted by our customers through photos. Looking at the products in your home will give you a good idea of how people use your products.
Using this process, Bradley was able to understand that customers purchasing his coffin shelves would also be interested in accessories such as miniature pumpkins, skulls, and other spooky decorations. It’s done.
By sourcing inexpensive add-ons at an additional cost of 25 to 30 cents, we were able to assemble a complete package product that created enough additional value and differentiation from other similar products. This simple strategy can set you apart from others and give you enough of an edge to sell at a higher price.
In our podcast, you can hear more about how we use creative packaging and how customers perceive it as a value-add.
pro tips: If you change your product or add accessories, you can choose to launch it as a new variant or as an entirely new product. Releasing as a new variation of an existing list leverages existing reviews.
Learn how to become a better Amazon seller
If you’ve been paying attention to my other posts, you know that I’m a big proponent of investing time into learning the ropes and doing the hard work. It takes time, but you’ll likely become a better seller and have a better chance of success with Amazon Business.
Here are some related articles that will help you improve your skills.
The last word
Competing on price on Amazon is part of sellers’ efforts, and it’s normal in the product lifecycle to expect competitors to emerge to take a piece of the pie.
But don’t panic. Just because the competition is fierce doesn’t mean you have to run away with your tail between your legs. You can also stand your ground and be creative to outsmart the competition.
So if you want a sustainable Amazon business, think about strategies that create more value for your customers and differentiate you from your competitors.
In this article, we have introduced some actionable strategies to ensure a sustainable Amazon business. We also provided examples of branded products and sellers that have secured customer loyalty. At the end of the day, there is no right or wrong strategy. And that’s the joy of being an entrepreneur. It’s your business and you get to decide.
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Jessica Clark is passionate about all things e-commerce. She is constantly learning and adapting to find efficiencies and stay competitive in a fast-paced field.