Amazon has tried to make it easier for sellers by creating built-in tools that can automate changes to your account. One of these tools is the Automate Pricing Tool, which automatically adjusts prices for your products in response to account performance.
For example, if you have the Buy Box winning price, Amazon Automate Pricing Tool will change your bid without you having to manually change the price every time. While that sounds great, is the Automate Price tool something you should look into?
Learn more about the pros and cons of using the Automate Price Tool to determine if it is a viable option for your Amazon business.
PRO: You Create Pricing Rules
One nice thing about the Automate Pricing Tool is that you set the parameters. The tool doesn’t just change your prices randomly. You have the control to tell it when you want prices to change and what SKUs you want to change.
Automated pricing rules will only be applied to the specific SKUs, not your entire product catalog. Set a minimum and a maximum price boundary to make sure that your price is still falling within a range that you’re comfortable with.
PRO: No Extra Cost
Sellers don’t have to pay extra to use this tool. It is included in your professional selling plan. There’s nothing better than FREE!
PRO: No Third Parties
Because this tool is made by Amazon itself, there are no third parties involved. Amazon designed the tool, and it works within the existing Amazon infrastructure. Nothing gets lost or has to be transferred over from other tools. You can go straight to the source.
PRO: Easy-to-Use Interface
Learning new tools can be confusing. But the Automate Pricing Tool has a very intuitive interface. It is easy to use, and there is a summary of pricing changes at the bottom of each screen.
CON: You Can’t Always Beat Your Competitor
One of the downsides of Automated Pricing Tool is that you can’t always beat out your competitor. If you and your competitor have the same rule “Stay below the lowest price by $0.05,” the prices will favor whichever seller has a higher minimum price threshold set.
Let’s dig a little deeper.
If your minimum price is $5.00, and your competitor’s minimum price is $5.50, then your price will jump to $5.45 while your competitor’s price will go to $5.50. This system indicates that your price can jump right to your minimum if another seller has rules set to beat your prices.
CON: Price Stays the Same If You’re the Only Seller
Even if you are the only seller, your price won’t change. This is a major bummer when using the Automate Pricing Tool because many third-party tools will automatically adjust your price to your maximum price if you become the only seller.
CON: No Bulk Pricing Rules
Many third-party tools will let you bulk upload listings and apply pricing rules, but the Automate Pricing Tool does not. For now, you have to manually set your minimum and maximum prices for each product listing.
CON: No Multi-Fulfillment Rules
The Automate Pricing Tool lets you compete against the lowest price on the listing or against the Buy Box. However, there isn’t an option for a single product listing to compete with both Merchant Fulfilled sellers (MF) or Fulfilled by Amazon (FBA) sellers.
For example, you can set up the Automate Pricing Tool to compete with FBA sellers only. However, if you lose the Buy Box to an MF seller, your pricing rules won’t apply. If you choose not to take the fulfillment into account when you’re setting up your rules, you can try to match the Buy Box. But, you might just end up matching the MF sellers and setting a lower price than needed to win the Buy Box.
There are some ways to work around this obstacle, but it can still be extremely frustrating when trying to bid against FBA and MF competition.
Hopefully, these pros and cons will help you determine whether or not to use the Automate Pricing Tool. For more direction, get a FREE Listing Analysis from Nozani.