If eBay is a Race, Here’s How Sellers Can Win
Wiser is a dynamic pricing and merchandising engine that monitors, analyzes, and reprices retail products in real-time. Wiser enables retailers to boost profit margins and revenue, price with confidence, and improve merchandising through a sound pricing strategy. Today Angelica Valentine from Wiser discusses how you can price to win in a competitive marketplace.
Selling on eBay isn’t easy!
In a market of thousands of potential competitors, how can you stand out?
Products might be the same, but your pricing strategy is the way that you can make yourself unique in the eyes of shoppers. However, not just any pricing strategy will do. Giant retailers, like Amazon and Walmart, follow a loss leader strategy by selling products at the lowest possible price. This isn’t realistic for most retailers that can’t compete with the sales volume of the giants. So how can eBay sellers get ahead in this hyper-competitive age?
Price for Profit
One thing that giant retailers are doing right is using dynamic pricing. It is a pricing strategy in which prices remain flexible and are dictated by a mixture of external and internal factors. Some external factors that dynamic pricing takes into account are competitor pricing, conversion rate, and market trends. Internal factors, like sales goals and inventory levels also are taken into consideration when pricing. Regardless of the marketplace sellers use, dynamic pricing is the top way to boost the most impactful metrics.
Giant retailers really have the hang of dynamic pricing. During the 2013 holiday season, Amazon sold 426 products per second. Yes, you did read that correctly! So what is Amazon doing that other online retailers should copy? Dynamic pricing. On average, Amazon reprices every 10 minutes and you can bet they’re not doing all of that manually. Automated price changes are key to Amazon’s success. This is true because fixed prices are a great way to limit your sales, profit, and revenue. Amazon doesn’t want that and I’m sure you don’t either.
Why eBay is Unique
eBay’s marketplace is a different dynamic to Amazon’s, but it is still a marketplace that requires round the clock price monitoring and adjustments. There are several tips and tricks that eBay sellers can use to increase sales. Here are the top 3:
Now this one isn’t for everyone, but it’s worth a mention. Free shipping. Consumers love it, but do you offer it?
Offering free shipping on everything isn’t the best idea, but making it an option in conjunction with an incentive is the way to do it. Free shipping when shoppers spend a certain amount really does work and it’s great for sellers when that amount is a bit higher than their average order. 58% of shoppers make another purchase to earn free shipping. Get shoppers to spend more and increase your average order, what’s not to love?
How can you make informed decisions without knowing the data? You can’t. eBay offers its sellers click-through rates, sell-through rates, and more statistics for free. So take advantage of them to get more insight that will help you become a better seller.
Psychology is half of pricing. Ways to do this include using 9s (charm pricing), relative pricing, and more.
eBay’s Promotion Manager allows you to offer: Volume offers to encourage buyers to spend more or add more items to their orders with a discount; Related items offers to cross-sell additional related items (such as accessories) by providing an incentive offer; Sale event offers to automatically merchandise reduced or special priced items on a ‘sale page’; and Conditional free delivery offers to automatically merchandise items that qualify for a promotional free delivery offer. eBay Promotions Manager is a free tool so why aren’t you using it?
What other strategies are helpful for eBay sellers? Leave a comment with your response.