Selling on an ecommerce platform can sometimes feel like a game of chess where being out-maneuvered can knock you out of the game. The most common way brands are out-maneuvered is via price.
On Amazon, third-party sellers are rewarded for offering low prices, and that often means they’ll undercut your pricing to get ahead. This behavior (called price erosion) makes it very difficult for other merchants to sell your product without eating into their own margins, and without proper checks on the sellers contributing to erosion, you may see your profits plummet. That’s what makes maintaining price stability on Amazon so important: it protects a brand’s margins and ultimately, the brand itself.
There are several things you can do to maintain price stability and regain control of your brand on Amazon. What works for one brand may not work as well for another, but these are five proven tactics that can help.
A MAP (Minimum Advertised Price) policy is a policy set by a manufacturer that tells resellers the lowest price they can advertise for that manufacturer’s products. MAP policies apply to _advertised _price and don’t limit the actual price a seller can set for a product. Brands set them to protect themselves from price erosion.
A good MAP policy outlines advertised price suggestions on specific products and the consequences for vendors who violate the policy (i.e. being banned from selling the product, having their account frozen). When effectively enforced, MAP policies incentivize third-party sellers to not undercut other sellers on cost, keeping pricing stable and giving other retailers a fair chance to sell a brand’s product in the market.
Note: before setting up a MAP policy, you’ll want to consult with a lawyer or legal team to ensure your brand doesn’t run afoul of antitrust laws.
Cutting the number of distributors selling your product can also help you maintain stability and take back control of your brand. Limiting your distribution allows you to more easily monitor where your product is being sold and at what price. It also helps you to retain authorized distributors who are following the rules while removing those who are not.
It may feel uncomfortable to cut off distributors, especially those you have developed a strong relationship with, but if a seller continues to violate your pricing policies, the harm done to your brand in the long-term by keeping them will be far greater than the harm done by cutting them out.
One reason why sellers may be undercutting your pricing on Amazon and creating instability is because your pricing is not as competitive as it should be in the first place. If your competitors are selling similar products at a noticeably lower price, it will be much harder for third-party sellers to move your product and more enticing for them to lower the price so that customers will have the incentive to purchase from them.
To find competitive pricing that works for your brand, conduct analysis on similar products across the market that can help you determine what prices make sense.
Often Amazon pricing is unstable because your products are being sold by unauthorized sellers who have no incentives to stop and no control. One way you can prevent this from happening is by enacting quality control policies or procedures.
An example of a quality control procedure is serialization. Stamping or printing each one of your products with a unique serial number allows your warehouse to track them more easily so you can identify leaks and ensure your customers are getting legitimate products. Serialization takes time and money, but it’s one way to protect your margins.
In order to get your pricing stable, you need to be aware of price drops, and the good news is there is plenty of technology available to help you monitor price shifts around the web. Chrome extensions like Honey and WikiBuy can help you compare a product across the web to other marketplaces. Extensions like Keepa can show you price fluctuations.
Another tech tool you can use is Predict. Predict is comprehensive, in-depth software that allows you to see data on MAP violations, how competitive your products are, and how much it’s costing you.
With the right tools and the right policies, you can stay on top of the game when it comes to price stability on Amazon. Read more about how to maintain prices on Amazon with our eBooks below, or contact a Pattern representative to learn how we enable our brands to gain pricing control on marketplaces.
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Peak season is almost upon us and with all signs pointing to it starting earlier than ever, with Christmas gifting searches now ramping up in August and September, it’s time to start preparing for peak. In this article, we’re sharing our top five tips for planning and preparing for peak season with Google Ads and the strategies required to get your Paid Search ready so you can drive success over this crucial period.
In 2021, gifting search terms started increasing in popularity in August. The general trend is that people are looking, researching and weighing their options early, so it’s best to start your Paid activity early to ensure that you’re capturing that early research traffic. This will help drive revenue alongside aiding those consumers who are in their research phase.
From 2020 to 2021, spend during Cyber Week actually only rose 2% but in the weeks leading up to it, it increased by 16%. However, Cyber Week is still the biggest period during the latter half of the year, accounting for 23% of all online spend by consumers over peak. Being prepared and starting early will help you to maximise your time during this period.
According to Google, 48% of global consumers have stopped buying or using a service due to privacy concerns. Privacy is front of mind when consumers are shopping online and we know that Google is phasing out 3rd party cookies in 2023. This is going to make it much harder to track users online and it’s something that brands need to think about this now – waiting isn’t an option.
From a Google Ads point of view, you want to ensure you have set up the Google Ads tag across your site and have enabled ‘Enhanced Conversions’, which ensures all conversions are tracked and allows you to monitor other actions such as ‘Add to Cart.’ This is relatively easy to set up, especially if you use ‘Google Tag Manager’.
It’s also vitally important that you build up your first-party data during this time as this is data you own and it can be used when targeting consumers that have provided your brand with their email address. Pattern’s own experience shows that by segmenting and using first-party data, you can see a 10% improvement in revenue and ROI.
A full-funnel approach is now more important than ever as consumers become more discerning and have more choices than ever of where to shop.
Pattern has seen success with Google Ads’ ‘Discovery Campaigns’ (image-based ads that appear on Google platforms such as Gmail and the Google app), which have driven success both from a traffic and revenue perspective.
The performance of these campaigns is significantly enhanced by adopting a segmented and nuanced approach to first-party data and incorporating these into your campaigns. Other options for a full-funnel approach include YouTube and testing bidding on keywords that are more representative of the research phase. (e.g. ‘best baby clothes’ for a baby clothes brand)
Earlier this year, Google announced that they were moving away from Smart Shopping and launched Performance Max. This is a new campaign type that incorporates features and placements from Smart Shopping but expands them onto other platforms such as Gmail but also alternative creative options, such as images and videos.
Since Google has already started automatically upgrading Smart Shopping campaigns to Performance Max, expect to see some fluctuations in the first 2 weeks following the switch over but results generally seem positive. We recommend upgrading sooner rather than later to limit any potential impact to peak period.
Peak period will be even more competitive than in 2021 and you’ll need your budgets to support this period, we recommend boosting budgets in October to start capturing that early peak traffic. As we enter November and the Cyber Period, start early and make sure you are capturing those consumers looking for early bargains, ensuring you are being nimble in your optimisations and reacting to the data that you are seeing.
Overall, peak period is vital to help drive your sales and by preparing early, you will see strong results and drive success for your brand. If you want to discuss how your brand can navigate this next peak period, contact us to discuss your options with our performance team now.
Entering the ecommerce landscape is a huge undertaking for any brand—it usually requires a large investment in resources and expertise to really be successful. Any brand can quickly get in over their heads trying to navigate the nuances of SEO, fulfillment and logistics, distribution control, listing optimization, and meeting the numerous other requirements and administrative tasks to show up well on marketplaces.
Unfortunately, because it’s so easy for third party, gray market, and unauthorized sellers to obtain and sell products online, many brands find themselves pressured to execute an ecommerce plan without the right resources to succeed on marketplaces and their other channels.
So, for brands looking to enter the ecommerce space or improve their current and future performance, it makes sense to partner with an ecommerce consultant.
Pattern’s global presence and proven success with hundreds of brands has allowed us to develop highly effective ecommerce consulting services. We can guide your brand to navigate issues both large and small in marketplaces worldwide. To maximize your ecommerce efforts, you’ll need to understand what an ecommerce consultant does and how to select one who drives the right value for your brand and products.
An ecommerce consultant is a specialist in the ecommerce space who can give you personalized guidance on how to market your products and grow their presence on digital marketplaces.
An ecommerce consultant should be able to analyze your brand, audience, category, opportunity, and current roadblocks and help you understand how to utilize your resources (or what resources are missing) to be most effective in capturing your opportunities in the ecommerce space.
Not sure how to evaluate a consultant? Here are 4 key attributes to look for as you make your choice.
At Pattern, we prioritize brand obsession for a reason—we know that a brand-centered mindset makes a crucial difference in the outcomes and results our partners achieve. So in our experience, when you begin your search for an ecommerce consultant, it’s important to look for a partner who is specialized in ecommerce, invested in the product, and passionate about helping brands build and improve their strategies. Typically, this means finding someone that consults exclusively for ecommerce marketplaces, rather than choosing a consultant who offers many different services.
It’s also important to avoid choosing a consulting partner who can’t deliver the right experience for your brand. The best indication of whether your potential consultant can do that is to review their history, data, and results with other brands. Ask if they’ve helped others in your selling category, if they’ve solved specific issues your brand is facing, and why they feel you are a good fit. The key is to leave the conversation feeling confident that you understand your consultants’ capabilities and whether or not they match up with your needs.
It’s best to pick a consultant who knows how to guide a brand onto and through multiple marketplaces worldwide. You’ll want to take a look at your long-term strategy and think about the regions and platforms you’re currently on and where you might want to take your brand in the future. If your consultant is truly great at what they do, they’ll be able to help you perform well enough with your current product roadmap that it’ll be a no-brainer to expand your presence at the right time.
The most effective partnership with an ecommerce consultant will be able to give you both recommendations and point you to solutions for making those changes in your planning, processes, and execution. Your time and money is valuable, so you want to make sure that you’re spending it as efficiently as possible as you follow your consultant’s advice. So, before you commit to an ecommerce consultant, ask about the resources and concrete solutions they typically recommend to the brands they work with.
Finding an ecommerce consultant that checks the boxes can be a difficult task. At Pattern, our entire focus and drive centers around giving brands the tools and resources they need to succeed on domestic and international ecommerce marketplaces.
With over 100 global ecommerce consultants across 10 global offices, we have the right tools to partner with brands across the world to achieve better ecommerce success. We give specialized advice, then make sure our partners have all the adequate SEO, social media, CRM, Amazon multi-channel fulfillment services, and ecommerce outsourcing services they need.
Interested in ecommerce consulting services? Set up a call here to learn what Pattern can do for your brand on global marketplaces.