The REAL reason you can’t see all competing offers in scanning apps & repricers: The “Bundle Blindspot.”
#2 in a two-part series going deep into blindspots affecting Amazon scouting apps & automated repricing tools, and the pricing data Amazon is hiding from you.
Video: Blindspot #2 – The “Bundle Blindspot”
Wait, scanning apps & repricers have blindspots???
Fact: There are two major blindspots affecting Amazon scanning apps & repricers. The blindspots results in crucial data you need to make sourcing and pricing decisions being hidden from scanning apps, and made invisible to repricing tools.
You think your scanning app is showing you all the data. You think your repricer is comparing your offer to all your competition. They’re not.
These blindspots have two serious impacts on your Amazon business:
- Missing out on profitable inventory (because your scanning app isn’t showing you everything).
- Repricing items incorrectly (either too low, or not at all).
This subject is so big, I gave each blindspot it’s own article. Quick recap on what we already covered…
Recap: Blindspot #1 – The FBA Blindspot
The first blindspot (covered extensively in my last article – must read) specifically impacts FBA sellers. If you’re an FBA seller, and you’re using any sourcing apps or repricers, this blindspot mandatory to understand. Here it is (again):
Any item that is not priced among the lowest 20 offers is invisible to your current scanning app or repricing software.
Since FBA prices are usually priced higher than non-FBA (and often outside the lowest 20), this means a HUGE number of FBA offers are invisible to all scanning apps & repricing tools.
If you were unaware of this, and aren’t terrified right now, read the last two sentences again, very slowly.
That’s just Blindspot #1. Unfortunately, it gets worse…
Blindspot #2: Introducing “The Bundle Blindspot”
This is the other blindspot that (once again) affects all Amazon sourcing apps and repricing tools, covered here for the first time.
The Bundle Blindspot can be explained like this:
Your current scanning app or repricer is unable to see a continuous list of lowest competing offers. Instead, it shows a collection of “bundles” comprised of several offers, and shows you the lowest price from each bundle.
In other words: Apps & repricers only display a partial, broken list of competing listings for every product.
These “bundles” consist of similar priced offers grouped together by six different attributes, so they appear to be one single offer. But they’re not.
You think when you scan an item, your app is showing you all prices, from lowest to highest. It’s not. You think when you using your automated repricer, it can review all your competitors and reprice accordingly. It can’t.
The reason this is called “The Bundle Blindspot” is that Amazon bundles “similar” offers together into what they call “groups.” More on this in a second, but it’s important to understand two things:
- Every price you see in your scanning app represents a bundle of offers – not one single offer).
- You are never seeing a true ordered list of all competing offers, from lowest to highest. Not at all.
(The real reason it’s called this is that I’m the first one to talk about it publicly, so kind of like discovering a new planet, I get to name it whatever I want and this is the dumb name I chose).
Technical explanation in a moment, but first…
How is this different than the FBA blindspot?
It’s very different.
One, the Bundle Blindspot impacts both merchant fulfilled and FBA sellers equally. The Bundle Blindspot impacts every seller. This blindspot spares no one.
Two, the Bundle Blindspot impacts all inventory. Remember the FBA blindspot only has the potential to impact products with more than 20 offers. The Bundle Blindspot impacts every product.
“This sounds like a conspiracy!!!”
So right now you’re thinking: “Hold on Peter Valley – I’ve been told that the prices on my app represent the live prices on Amazon.”
My first question would be: Have you ever clicked over to Amazon and confirmed the prices match? You can confirm this blindspot with almost any product in just a few seconds. A lot will match. Many won’t. Almost no one bothers to check.
But among those who remain in denial, it always gnaws at them: Why are the prices often different from what they saw on the app vs when they get home and list? And why do repricers only let you compete against the lowest priced offers? It makes no sense.
So while the Bundle Blindspot is easy to confirm with your own eyes, we can prove this in an even more conclusive way: From Amazon itself…
Not a conspiracy theory: Here’s the proof
First, here’s the admission from Amazon. Note this is written for software developers, but you should get the idea.
The GetLowestOfferListingsForSKU operation returns the lowest price offer listings for a specific product by item condition. The listings for the specified product and ItemCondition are placed in offer listing groups, each group representing a different combination of… six qualifiers
“Some (but not necessarily all) of the active offer listings for the specified product and ItemCondition, initially sorted by the lowest landed price, are placed into their corresponding offer listing groups, and the listing with the lowest landed price from each group is returned. If multiple sellers have listings that share the lowest landed price for a group, the listing from the seller with the highest feedback count is returned. Groups without any listings are not returned.”
I’m not a tech person either, so this kind of language is hard for me to follow as well. Fortunately we not only do we have a simple way to prove ourselves this blindspot exists, and Amazon’s own words, but also words from other software tools that depend on Amazon’s API. For those who need even more evidence to be swayed, here you go…
Even more proof: Amazon scanning apps address the Bundle Blindspot
Here’s a few excerpts from various statements that Scoutly, the Amazon sourcing app, have made about the Bundle Blindspot:
Repricers aren’t talking about this blindspot (they don’t have to)
Unlike Scoutly, repricing tool companies aren’t making any statements about the Bundle Blindspot. They don’t have to. The blindspot is revealed in what’s missing from their features. They don’t have to say anything for the Bundle Blindspot to be as glaring as a neon sign.
No automated Amazon repricing tools (except this one) allows you to price against anything other than the lowest offer. Not the 2nd lowest offer. Not the 3rd lowest offer. Only the lowest.
It would be impossible for this to merely be an “overlooked feature,” since its in high demand by nearly every seller. No Amazon seller wants to only have the option of chasing the lowest offer (except, maybe, drug addicts).
The absence of this feature from every Amazon repricer (again, except one) tells the whole story. Repricers want to offer this feature, but their Amazon API-dependent architecture prevents it.
We’ve established we have a problem. Not only do we have to deal with The FBA Blindspot, we now have to admit that apps and repricing tools have another blindspot that impacts our profits. But what specifically are these tools hiding from us?
Boring technical explanation
Let’s cover why this blindspot exists, and specifically what data is being kept from you. Understanding this blindspot comes in two parts: Understanding what an “API” is, and understanding exactly what data is hidden.
Understanding Amazon’s pricing API
As explained in the FBA Blindspot article, third party apps and repricing tools rely on what’s called an “API.” Think of it like a tube that software tools can connect to Amazon to get data like prices, sales rank, etc.
It’s in Amazon’s interests to offer an API, because it allows developers to build tools that encourage more people to sell on Amazon, which furthers Amazon’s agenda to grow their company. API’s are very common.
The thing to understand is that Amazon is in control of what data they share through this API “tube.” They control what gets shared, and how it gets shared.
Which brings us to pricing data and The Bundle Blindspot…
Understanding what pricing data Amazon hides
This is going to be challenging to explain in layperson terms (as a non-developer, it’s hard for me to fully understand myself), but here are the bullet points:
- Amazon bundles pricing data into what they call “groups.”
- Prices are bundled or “grouped” based on six attributes, such as Condition, Sub-Condition, Shipping Time, Seller Feedback Rating, etc
- After analyzing all six attributes, Amazon applies a secret logic to “group” multiple offers together.
- This gets delivered to scanning apps and repricing software in the form of a list of prices.
- Visually speaking, this list looks like a list of individual prices. In fact, each price represents a bundle of prices (aka a “group”) containing one or more multiple offers.
Again, this explains why you can see a list of prices in a scanning app, then click over to Amazon and see multiple prices that aren’t shown in the app.
This also explains why no repricing tool let’s you price against the 2nd or 3rd lowest offer. Amazon’s API gives them a list of prices, but they aren’t the continuous lowest offers, just the lowest price from each “group.” It’s simply impossible for them to promise they can “see” anything other than the lowest-price offer.
How the Bundle Blindspot ruins scanning apps
Here’s an example of how this blindspot might be impacting your profits when it comes to apps and your sourcing.
Say you scan a book. The Amazon sales rank is really strong. Say, 30,000, indicating the book is selling several copies a day. So you can be a little liberal with how you price.
Now let’s say the lowest price is $12. After considering cost of goods, selling at that price gives you 50 cents profit. Definitely not worth your time.
These are the lowest offers visible on your app:
- $12
- $15
- $15.75
- $16.90
- $18
You notice the 2nd lowest price is $15. That gets the profit above your minimum $3 threshold. Since the book is in such high demand, it’s totally reasonable to expect a sale around the $15 price.
So you buy the book. Get home. Go to list it. And click over from your listing program (which also has the same blindspots) to the Amazon page. On Amazon, the prices look VERY different than what your scanning app showed. Here’s what you see now:
- $12
- 12.05
- $12.33
- $12.49
- $15
- $15.75
- etc.
So instead of your $15 listing prices (which you need to be profitable) being the 2nd lowest price, you now realize it’s the 5th lowest. Big difference. And you never would have bough that book had you known.
You just got hit by the Bundle Blindspot.
(And this is just one example of how it manifests. Consider all the ways having prices invisible to your app can impact your sourcing).
How the Bundle Blindspot ruins Amazon repricers
The impact of the Bundle Blindspot is vastly more severe with repricers than scanning apps.
The inability to price against anything other than the lowest priced competitor is perhaps the most costly limitation that could be imposed on your repricing.
The impact on your profits that comes from being forced to only compete against the lowest priced offer is a devastating act of coercion from repricing tools, tethering you to a single price (the lowest one) – which may or may not be an intelligent price (it usually isn’t).
Here are the three ways the Bundle Blindspot ruins repricers:
#1: You’re forced to chase lowest price downward.
I call this the “Tyranny of the lowest price” – how one insane or sloppy seller setting a lowball price can drag every other seller down with them. One desperate (or reckless) seller dropping their price causes every repricer to drop the prices for every other offer (due to the blindspot), which tanks the entire product.
There is nothing special or sacred about the lowest price for any product about this specific moment in time. Prices go up and down all the time. Yet the Bundle Blindspot forces repricers to treat the lowest price like some kind of edict from God and forces all sellers to chase that price down (often to unprofitability).
Consider how costly it is that no API-depdendent repricer can price against anything other than the lowest price offer. Much (if not most) of the time, you could get more for your product if you priced higher than the lowest competitor. But your current repricer simply won’t allow it. (Or it will, but in a way that makes that feature totally useless. Read on…)
#2: If you want to price above lowest price, it’s meaningless since you’re unable to see the 2nd lowest
Any repricer is going to offer you the ability to price above the lowest price, but this is entirely meaningless. How can you price above the lowest offer if you don’t know what the 2nd (or 3rd, etc) priced offer is? You’re pricing totally blind.
Example: The lowest priced offer is $15. You set your repricer to price $1 above the lowest offer (e.g. $16). But your repricer can’t “see” that the 2nd lowest offer is $15.20. And the 3rd lowest is $15.49. And the 4th lowest is $15.77. And the the lowest is $15.95.
So you think you’re pricing 2nd in line, but you’re actually 7th. Pricing above the lowest priced offer is 100% meaningless if you don’t know what the other competing offers are. It’s actually insane.
#3: You’re unable to ignore the lowest price, and price solely against 2nd or 3rd lowest (or beyond)
This is literally impossible with your current repricer. It’s kind of staggering to think about.
This brings us back to the “tyranny of the lowest price.” There’s nothing special or inherently “correct” about the lowest price at any particular moment (to the contrary, the lowest price is often completely insane and should be aggressively ignored).
Or maybe there’s nothing crazy about the lowest price, but the item is in high demand so you can safely ignore the lowest price, since high-demand items see frequent price fluctuations on a minute-by-minute or hour-by-hour basis (and will sell no matter what).
In these instances (or any instances), it is impossible to say to your current repricer: “I want to ignore the lowest price.” Literally impossible.
How to beat the blindspot with your Amazon scanning app
This isn’t an elegant solution, but it does work:
When you scan anything, and it makes sense to price that item above the lowest offer (you should be doing this a significant percentage of the time) – click over to Amazon to see the full range of competing offers.
Since you’re only seeing groups of random offers in your app, you just have to click over to Amazon to get the whole story.
How to beat the blindspot with your Amazon repricer
Two ways to not be victimized by the Bundle Blindspot when repricing:
Reprice manually: Get your pricing data directly from the only source you can trust (the Amazon page), and set prices manually. This requires significant time and manual labor, but it is the single most precise way to reprice your inventory.
Use NeuroPrice: It is the only repricer that is not API-dependent and can price against the 2nd or 3rd lowest offer (both MF or FBA), as well as the Buy Box (used or new).
Or,
Recap: What did we learn?
- Amazon bundles pricing data into “groups” before sharing it with 3rd party software
- This limitation prevents scanning apps and repricers from “seeing” anything other than the lowest-price offer
- This means you’re not seeing all pricing data in your Amazon scouting app
- This means your repricer is forced to only compare your offer to the lowest-priced offer.
- The Bundle Blindspot can be beaten, with a little extra work.
This concludes my massive two part series on the data blindspots impacting apps and repricers (and your profits).
-Peter Valley
PS: If you missed my in-depth article on Blindspot #1 (“The FBA Blindspot”) – read this immediately.
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