How do you know if you’re repricing too often? Or not often enough? A look at the best repricing schedule for Amazon sellers.
Is there such a thing as repricing too often?
One of the top questions I get is: “How often should I reprice?”
Pretty much every Amazon seller agrees: You have to reprice your inventory. Unless you’re only selling very high-demand items in a category where “replens” are uncommon (like Books), there’s no scenario where you can stay in business without regular repricing.
To answer the question of “how often should you reprice?” it’s important to understand the balance you’re trying to strike.
On one hand, you should reprice as often as you can to keep your prices competitive.
On the other, there is such a thing as over-optimizing your prices, and repricing too much.
Striking the balance between repricing too much, and not enough
Generally speaking, repricing more than 3 times a day is probably excessive. I’ll get into more specific numbers in a second, but that’s a good starting point. This is purely opinion, so keep that in mind.
The balance you’re always trying to strike with repricing is: getting sales, while dropping your prices as little as possible.
The three tiers of repricing urgency
Here is a general framework to think about repricing: The lower the demand for an item, the more often you should reprice it. The higher the demand for an item, the less often you should reprice it.
(Note: what follows is an important concept, but will not be as relevant if you’re using repricing software, and repricing more often doesn’t require any extra effort on your part).
One of the frequent pricing concepts I push is how Amazon Sales Rank should be at the center of any pricing (and repricing) decision. I think of pricing in terms of “tiers of urgency.” You can’t answer the question about how often you should reprice inventory without considering the demand for an item. Here’s how I look at it:
Repricing Tier #1: High-demand items
What Sales Rank to consider “high demand” will be different for every category. For Books, I consider it anything better than 100,000.
Reprice high-demand items less often.
Why? Because the price of high demand items is inherently volatile. You can almost never reprice these, and they’ll sell eventually. You don’t need to attend to these much (and often – not at all).
Repricing Tier #2: Medium-demand items
For Books, this would roughly be an average Sales Rank of 100,000 to 1 million.
Reprice medium-demand items regularly.
These items are selling, but you can’t afford to ignore these completely. These need to be “price optimized” to get sales.
Most of my personal inventory is in this range.
Repricing Tier #3: Low-demand items
With Books, this would roughly be an average Sales Rank worse than 1 million.
Reprice low-demand items every chance you get.
Give these the most attention. If you have limited time / resources, always reprice these first. These items aren’t selling enough to ignore – you want to aim to be the next sale.
What are the consequences of repricing too much?
I call this “over-optimizing.” The major downside to repricing too much is the impact it has on higher demand items. Particularly with items that are selling multiple copies per day, there is no reason to be repricing these multiple times daily.
The prices for high demand items is so volatile and goes up and down so many times per day, you can be the 5th lowest price, lowest price, then 7th lowest, then 2nd lowest, then lowest again – all in a span of six hours.
So what is the logic of repricing high-demeand items mulitple times per day? There are so many buyers coming and going, that there’s no rush to get a sale. You don’t need to frantically chase the lowest price 10x a day when it’s selling multiple times a day. You’re going to get a sale no matter what you do. Whether your item is price $18.15 or $18.02 is irrelevant.
Adjusting prices frequently for something with a price that jumps around so much just isn’t useful, and does more harm (in the form of lowered prices) than good.
What are the consequences of repricing too little?
The consequences of repricing too infrequently are actually worse than repricing too often. No, they are not equal sins. If you have to commit one of these deadly repricing sins – price too often. But what happens if you reprice too little?
The answer is simple: You won’t get sales. If you don’t reprice an item, after a certain point its the same as that item not being for sale at all. And this doesn’t just apply to single items – it applies on an inventory-wide scale. If you haven’t repriced your inventory recently, you may as well not have any inventory at all.
From the moment you list something for sale on Amazon, prices start to shift. Prices go up. Prices go down. And when they go down, your listing starts to get buried.
Maybe your offer gets underpriced by one or two sellers. No big deal. Your item is in great condition and your feedback score is good, and this might appeal to certain buyers who aren’t just going after the cheapest price to save a few pennies.
But as time goes on, you can quickly become the 3rd, 4th, and 10th lowest price. And the number of buyers even seeing your offer starts to dwindle. Not only did you give up any hope of winning the Buy Box awhile ago, but you’ve given up an hope of customers who aren’t shopping through the Buy Box.
You haven’t done anything wrong – your price made sense at the time you created the listing. But in the span a hours, days, or weeks – your offer is totally buried and you have no hope of every getting a sale.
That’s what happens when you don’t reprice.
How often you should reprice (the vague answer)
The vague answer is only going to apply to sellers repricing manually. If you’re using software, this won’t apply since the process is automated and it doesn’t take any effort to reprice. Using an automated reprice? Proceed to the next section.
If you’re repricing manually, the answer is: Reprice as often as you can without burning out and ceasing to reprice altogether.”
Repricing manually can be tedious, and if I said “do your entire inventory at least once per day,” while that might be the best schedule for your profits, if it causes you to burn out then it is detrimental in the long term.
Here’s a bonus tip: If you sit down to manually reprice and feel like you don’t have the time or will to complete your entire inventory – reprice the low-demand items only. (If you’re selling books, I would loosely define this as books with an Amazon Sales Rank of worse than 1 million). This is the inventory that most needs your attention, and where its most important you get the quickest possible sale.
You might be inclined to think high-value inventory should take precedence over low-demand. But a high-value, high-demand item can still be expected to sell (eventually) if you don’t reprice it frequently. A low-demand item needs all the help it can get.
How often you should reprice (the specific answer)
The specific answer is: “Reprice at least once per day.”
A lot of people work it into their daily routine, and reprice along with checking sales and other daily maintenance. Sellers with automated software might choose to run a full repricing on their inventory once a day.
Twice a day is also good (morning/night). Three times a day (morning/afternoon/evening) is also fine.
Beyond three times a day, personally I have found it to be excessive and offering diminished returns. At that point, you’re just competing with repricing software that will underprice you within seconds anyway, so whether you’re repricing 5x a day or 100x, it’s irrelevant. You’re just playing leapfrong with megasellers and your repricing has diminished impact.
Repricing = more sales (but there’s a catch)
Reminder: Repricing more often will translate to more sales. But increased sales volume isn’t necessarily the most important metric you should be chasing.
Increased sales isn’t a victory for your business if you had to drop prices 10x in one day to get that sale, and your margins dropped to almost nothing.
Profits are more important than sales. But repricing will increase sales.
- There is such a thing as repricing too much
- Repricing too little is worse
- If manually repricing, apply a tier-schedule based on Sales Rank
- The more you reprice, the more sales you get