November 1, 2018 by Price-Fuel
In case you haven’t noticed, Amazon is on top right now and here to stay. They’ve quickly become one of the largest companies in the world, to the point that giants like Walmart are shuffling to compete online with Amazon’s market share.
The best way to invest in Amazon and your future isn’t just to buy stock, it’s to take advantage of Amazon’s seller platform to carve out an empire of your own. To do this, you will need to have stellar pricing strategies, which are usually tied to Amazon’s ranking system.
Consider the points below to learn about Amazon sales rank and how you can use it to your advantage.
The sales rank is one of the best forms of data you have to determine market share with a particular product.
Basically, Amazon’s sales rank describes the popularity of items in certain niches and categories, based on how well and fast they are selling. This rank, which ranges from 1 to more than 1 million, is used as a guideline for people that sell items across the merchant and Fulfillment by Amazon (FBA) programs.
If you sell private label items, you’ll have a better idea of what sort of products are selling best. If you resell on FBA, you’ll know which items are valuable and most likely to sell quickly when you’re racking up at thrift stores, liquidation centers, and estate sales.
Most importantly, this ranking plays a huge role in how you price your products.
The way you price your items has a huge role in your ability to secure and keep market share. You’ll get data regularly as Amazon’s sales rankings update throughout the day.
Keep the following points at the forefront as you use this data:
The best thing you can do whether your sales rank is at number 1 or rising slowly and steadily is to keep them in full supply.
Nothing says a plummet in revenue and ranking like not being able to meet the demand of your customers. Keep your items stocked and never wait until you run low to address this demand.
With Amazon, sales history is everything.
This allows you to have a long-term brand, which makes your Amazon store more trustworthy to the public. It will allow more opportunity for reviews, which are incredibly worthwhile to keep your seller rating high.
It’s vital that you use sales rank as a metric to raise and lower your prices.
Stay up to date with your rank, first and foremost, so that you can make decisions as needed. For instance, if your sales rank is beginning to fluctuate, it doesn’t mean that it’s time to panic.
This number is updated each hour and is directly tied to the amount and availability of other products within the niche. As you might imagine, these variables go up and down based on sales promotions and other tactics. Because of this, you should think of your sales rank as a range, so that you have a better idea of where it should be.
Once you have a grasp on sales rank, you can begin adjusting your prices accordingly.
When your sales rank is low and healthy, at 20 or below, for instance, it may be time to raise your price. Make sure the rank is staying at this level for at least a few weeks to a month before trying this strategy.
This established sales history lets you tweak the price to see if it’ll sell with a price increase.
Conversely, if your rank starts to surpass 100, it may be time to lower the price so that you can keep moving inventory.
While sales rank is a vital metric, know when to make pricing decisions based on black and white data, such as how many units in your inventory are actually selling.
When you establish a name for yourself, the rewards on Amazon will only get sweeter.
Amazon starts advertising sellers with an established history, which increases visibility and leads to even bigger spikes in revenue. This doesn’t happen overnight but requires you to continuously establish a solid sales history on the site.
By taking the time to price your items properly and keep your sales ranks high, you stand a better chance of becoming a trusted seller for the long-term.
If you can make this happen, a lot of your work and strategy will begin to take care of itself.
As you grow your visibility with sound pricing and sales strategies, competitors will naturally come in and try to undercut you.
One of the biggest ways they’ll do this is by stealing the Buy Box. This is increasingly important with the increase in Amazon Prime customers and people selecting one-click ordering.
The more high profile your listing, the better, and this is usually dependent on sound pricing strategies. A lot of variables go into who wins the Buy Box, so don’t get too caught up in undercutting your competition every day by pennies.
Instead, keep your prices healthy for profit margins, while knowing when to increase and decrease based on the market.
Learning to carve out market share on Amazon is something that will always evolve. Just as rapidly as the company has grown, so too are the ways to be competitive when selling on it.
To stay up to date with Amazon strategies that maximize profits, check out our products and keep reading the blog!