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The first algorithmic repricing solution 2012


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The first algorithmic repricing solution 2012

  1. 1. The First Algorithmic Repricing Solution
  2. 2. What is the Amazon ‘BuyBox’?• Amazon Buy Box is the box on a product detail page where a customer starts the purchase process by adding an item to shopping cart• Winning the ‘BuyBox’ is essential to capture sales for products that are listed on Amazon
  3. 3. Amazon ‘BuyBox’ Algorithm• Amazon algorithm assigns BuyBox based on number of key parameters of the seller: – Customer Rating, Reviews, Feedback, refunds – Fulfillment Channel, Delivery time – Item Price – Sales Volume, availability – Seller performance indicators – Etc..
  4. 4. What does it takes to win the ‘BuyBox’?• Amazon gives ‘BuyBox’ to seller that has the optimal price-performance• Performance is usually given• Appropriate pricing is the primary factor for winning the ‘BuyBox’• BUT, seller does not have to offer the lowest price to win the ‘BuyBox’, if their performance is good
  5. 5. Amazon Repricing• Repricing is a periodic revision of item price to win the Amazon ‘BuyBox’• Repricing Techniques: – Manual Repricing – Repricing Rules – Algorithmic Repricing
  6. 6. Manual Repricing• Advantages: – Complete control over pricing – Works well for low competitive items• Disadvantages: – Takes a lot of time to update prices, again and again.. – Hard to compete against automated repricers
  7. 7. Repricing Rules• Advantages: – Computer automates part of the re-pricing process• Disadvantages: – Seller is solely responsible for manually setting and continuously adjusting rules – Too complicated: many different rules required – Error prone: rules often interfere with each other – Very risky: a mistake in rules definition often leads to unprofitable sales
  8. 8. Algorithmic Repricing• Pricing is driven automatically by computer algorithms• No pricing rules required• Frequent and fully automated price updates• Allows to win ‘BuyBox’ consistently• Does not drive prices low, avoids price wars• Maximizes sales without compromising profit margins
  9. 9. Feedvisor: Algorithmic Repricing Solution• Fully automated• No pricing rules required• Web Based• Easy to use & Quick to setup• Increases sales volume dramatically• Protects profit margins
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