Four Types of Amazon Product Pricing strategies

Four Types of Amazon Product Pricing strategies


Do you have any pricing strategy for your amazon products? Many sellers on Amazon are selling the same product, so how sellers can manage to get the Buy Box? Amazon never claimed that product pricing strategy also affects the sellers to get a buy box but it affects.

Along with the pricing strategies, there are different factors that affect the seller’s approach to Buy Box. These factors include rating as a seller, buyer’s satisfaction, frequency of your sales, and many others. In this way, your product pricing can play an important role as it directly affects the number of sales. Products that you are going to sell should also be chosen carefully to manage to go to the Buy Box.

Read this complete guide to choose profitable amazon products.

When your business comes at the phase of product pricing on amazon, you need to consider these four product pricing strategies to increase your profit. Amazon does not always guarantee “Buy Box” to the cheapest sellers, there are so many strategies to drive on the road to success. These 4 product pricing strategies can be effective to sell profitable products on amazon and run a successful business.

1st Strategy- Penetration:

Penetration is a strategy when you offer a product at lower prices than your competitors. It helps you to gain more market share and compete with your competitors. Many new brand owners and experts use this strategy because it is efficient for existing brand owners to clean warehouses from old products and increase sales volume for new products. On the other hand, new brand owners use this strategy to build a reputation and earn market share.

Most of the time, a penetration strategy is adopted to promote their brand and the prices are raised once the brand owner achieves goals. As this strategy focuses to lower product prices, this is not beneficial to be adopted for a long time.

2nd Strategy- Skimming:

Skimming is an easy-going strategy. In this strategy, amazon sellers offer their products at higher prices so that other competitors also raise their prices and match them. At this phase, the price is lowered to stay in the competition. This strategy is effective for vendors who sell unique products and go ahead in the competition.

This strategy helps the vendor to earn more profit within a short time. Sony, Microsoft, XBOX, and Playstation are some brands that use the same strategy to earn profit. The product prices of these brands are higher when they come into the market. Then the price is lowered after sometime to earn profit.

3rd Strategy- Economy:

This strategy has small profit scales. This strategy aims to increase product availability in the markets. This strategy is useful for you if you are dealing with daily life accessories like soaps and detergents.

This strategy has low advertising costs and very little shipping prices.

4th Strategy- Premium:

This strategy is opposite to the economic strategy. The sellers using this strategy will use offer high prices of the products and use the brand name to generate additional interest.

This strategy is more efficient for renown brands such as Lynx and Gillete.

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