How Effective Pricing Changed My Story as an Amazon Reseller
And Why Price Positioning is the Most Important Thing
The definition of insanity is doing the same thing over and over again, but expecting different results. – Albert Einstein
How it All Started
I started selling things on Amazon back in 2010. After a few products without any sale at all, I started to watch tutorials about finding niches and writing cool copy for the products.
Sales started lightly at first. By lightly, I mean really lightly, like once in a month or two. Even though I did my research very well, and I spent my precious bucks on copywriting, nothing changes the numbers in my bank account in positive manner.
I tried anything I can do from taking cool photos, writing good copy, finding good niches, and everything else the “make money online” tutorials say. Nothing changed for almost a year.
I’m not telling they lie, but I think they have some optimistic thought in order to make money out of tutorials.
So I gave up. I’ve closed my merchant account and wrote some articles about how bad the experience was for a newcomer. The articles didn’t have an exact target, and no one read them either.
How Everything Changed
One day in 2016, after five years without any Amazon selling effort, I decided to do it again. But as Einstein stated, I shouldn’t have done the same thing and expect different results. So I try to change my mind.
I took a look at new blog posts, new tutorials, new copywriting skills etc.
They were still the same. Same thoughts, same methods, same “genius ideas” everywhere.
Then I started to search for more penetrated niches. There were tons of alternatives for any product in Amazon, so the competition is really high in almost any niche.
I needed to find a pattern from the best sellers. So I changed my research focus from niches to top sellers. I analyzed their products, copy, photos etc. Nothing different from the whole competition.
Then it came to pricing. I listed all the prices of the markets I wanted to enter, and found a pattern there!
The best-selling prices were low! Not significantly, but in pennies. For example a product in competition was $19.99, someone was selling it to $19.49 and guess what: The $19.49 one was in the best sellers list!
The Second Fail
I just realized it was about pricing more than anything else. The same products everywhere, but with different pricing. So I thought I can lower the prices and voila!
Of course it wasn’t the story. I did set my prices lower than everyone, but nothing happened! That was really frustrating.
Then I analyzed the top sellers again. This time, I noticed something: The prices of competition changed frequently. It’s even daily in some niches!
The Educated Decision
I tried to find some software to do the competition analysis. There were plenty, but they were inspired by those tutorials, not my sales!
So as a developer, I decided to code something to track the competition and create real value out of it.
I created a web app on my local machine. I called it “Babydoll”. Since it was my local machine, I didn’t need any domain names for that.
Started from scratch, automatically analyzed the pricing data daily, notified myself about any change in the prices.
Guess what: I sold something! And Again! And Again!
My sales didn’t go up 20%, they went up like 2000%, as I had almost no sales back in 2010 :)
Then PriceCute was Born
I really get something from my precious little product, and I decided to share it with the world.
I added graphs, price history tracking, effective mailing, COGS, position prediction and more!
Then I named it PriceCute.
It started small in the beginning, and I noticed that was the product all Amazon Sellers and Resellers need! Then I scaled it up really fast.
First 100 users was really hard to convince, because I was a really poor marketer. Then it skyrocketed!
Now, PriceCute has more than 1000 users who I personally contacted with, and I’m constantly improving it with their awesome ideas!
COGS and Position Prediction features are still in closed beta, but we’re planning to open them to everyone in no time. So it’s possible for them to be live while you’re reading this!
Also, we’re planning to develop a buyer version for it! So everyone could have benefits out of it.
Here comes the end. It’s as happy as it can be for me, so I decided to name the ending out of my favorite cartoon character: Snoopy.
Mr. Schultz, rest in peace. You inspired us all.
What Are Your Thoughts?
So, what do you think about price positioning? I wonder how you track your competition, and how to position your products. Let’s discuss them in comments!