The Amazon Strategist Show

Dominate the Buy Box: Expert Amazon Strategies from Seller Snap

• The Amazon Strategist Show • Season 3 • Episode 80

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Join John Cavendish and Adrian Rich from Seller Snap as they dive into advanced strategies for Amazon sellers. Discover how dynamic repricing can optimize your Amazon business, ensuring profitability without sacrificing the buy box. Learn about the importance of Amazon Business and how to tap into this lucrative market segment. Whether you're a reseller or a private label seller, this episode is packed with insights to elevate your e-commerce game.

Topics: Amazon strategies, dynamic repricing, Seller Snap, Amazon Business, e-commerce optimization, buy box, inventory management, game theory, Amazon API.

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Speaker 1:

When you choose a bad repricing solution or one that doesn't take some of this stuff into consideration, it's very easy to go oh, we should be priced below the buy box, that's how we'll win. But inadvertently you ruin buy box for everyone, you ruin everyone's profitability, and so you know, a good repricing solution will make sure that you're winning the buy box at the highest possible price and getting the buy box share that you deserve, without lowering the price to a point where you're liquidating stock and losing out on those margins.

Speaker 2:

Hello, I'm your host, john Cavendish, and welcome to season three of the Amazon Strategy Show. The show that's all strategy, with no hacks, no silver bullets and no magic pills, just real, practical strategies to grow your Amazon business. Today I'm joined by none other than Adrian Rich from SellerSnap. Sellersnap is actually a software which I've known about for the last five, six years that I've been in the Amazon space and we've had clients who've used SellerSnap for a long time, so I'm very excited to have him on the podcast. Adrian's actually the GM, so he's been leading the company for the last four years developing new tools, and he has a background in tools, customer analytics and actually developing the more technical and the more advanced things on the platform over the last several years, so I'm super excited to dive into that with him. Adrian, welcome to the show.

Speaker 1:

John, thanks for having me Really excited to be here.

Speaker 2:

Awesome. So it's a bit of a different episode today, which is really cool because driving into tool, diving into the tool which is used primarily, from my understanding, by a lot of resellers and actually, because of your price point and the way you work, a lot of higher level resellers. So can you talk us a little bit through maybe why somebody would use, you know, a dynamic repricer and you know what kind of what your average client looks like, I suppose For sure John Happy to.

Speaker 1:

So we are a price optimization and analytics platform, or as the industry sort of knows it as repricing, and it's an essential service for e-commerce marketplace sellers who have competitive products. So when I say competitive products, I mean these are people that are competing for a buy box or buy box similar type of placement on different types of marketplaces. But primarily we support Amazon sellers who compete for a buy box, and the way our algorithm works is it's trying to win you your buy box at the highest possible price and winning you the fair share of that buy box so that you can make sure that you're profitable without tanking the profitability of your listing and in a nutshell, that's essentially what it is, and for people in our side of the space, for our customer segment, it is an essential service, because you can't operate at the same speed or to the same decision-making capacity of a machine that's doing this 24 hours a day, and so that's sort of, I guess, where our niche lies.

Speaker 2:

I love it. And then kind of, really, how does the algorithm work, how does how to decide where you fit in and what's it taking to account for this repricing?

Speaker 1:

Yeah, it's a great question. So I think that you know. For those that know the repricing space, they would be aware that there's many different types of repricing solutions out there, different price points and different ways that they work, the former being rule-based systems where a seller builds really rigid ruling, or, if that's then this statement, based on a desired outcome. And the problem with some of those solutions is that they aren't flexible enough in dynamic environments, and obviously economic environments are dynamic by nature.

Speaker 1:

As competitors raise or lower prices, the elasticity of demand changes, and so the way our system works is we are very active and trying to understand the competition and how they're behaving, so we're tracking our competitors' behaviors and then, with that insight, making decisions that are positive towards the goals of our customers. So an example of this in practical terms is you might have one other competitor and you are undercutting that competitor by one cent. Other competitor and you are undercutting that competitor by one cent. And what's this causing the market to do? Is go lower and lower and lower and lower, until you're both selling at your bottom prices and hurting a bottom line. And the way our algorithm works is it recognizes these sort of price wars occurring and then instead, of engaging.

Speaker 1:

It says hey if my competitor is always trying to beat me by one cent, there's no point in me lowering prices. I might as well raise prices, and so at the end of the day you end up with that same fair share of the buy box you would have received at your bottom line, but now you're doing it at a profit margin that doesn't hurt that bottom line that's really cool.

Speaker 2:

I didn't even know that. So, rather than being programmatic and just always trying to win, it monitors and then does it then compare it to what price it would have it at anyway compared to the competition and is also monitoring the competition in the same like for same keywords or same niche. How does that work?

Speaker 1:

it's not based on supplementary, supplementary types of products. It's based on supplementary listings so you might compete with another seller for an identical product. You know a customer comes to buy, you know, let's say, an a wallah drink bottle I feel like it's a product that's gone viral recently and so you're going to buy this product and you're only buying one of them, so only one person can take the sale, even though there might be 20 people selling an identical product. And so what we're sort of trying to do is, like I said, understand that the behaviors of our competitors have every pricing and then make sure that you're priced optimally to get that fair share. And we sort of refer to it as game theory inspired repricing.

Speaker 1:

So you know you can win the buy box 100% of the time. That is possible. But to do that you have to be priced below your competition 100% of the time, and naturally you know this is competitive markets. If you try to be priced belowbeloaded competition all the time, you will lower the prices for everyone. You think about a gasoline station on two different corners of an intersection and if one of them tried to be cheaper than the other one all the time, both of them would lower their prices, and that's essentially what's occurring in a buy box. It's an intersection with two gas stations and you're trying to play a game or using game theory to keep the prices high.

Speaker 2:

That makes a lot of sense. And then, at the same time, is your algorithm also taking into account either your stock levels or the stock levels of your competitors on that listing?

Speaker 1:

I think we get this one a lot and essentially we're not really and the industry isn't, and I think it's good to bring it up because it's a bit of a misconception in the space, because people use tools you know, like Keeper, as an example, which tells you about your competition stock levels, but the way they're doing it is through scraping data, and repricers traditionally rely on the SP API, the Selling Partner API, which is when you authorize Amazon to give a third-party solution your data, and if you engage in scraping, you lose access to your developer ID. You'll have your account terminated. So it's something that I think people ask for all the time. I think it might be one of our most requested features through our sales inbox and through our feature request board, but it's not actually possible, for that reason is that you might have your developer credentials removed, which means you wouldn't be able to provide service at all.

Speaker 2:

Yeah, that would suck Kill the business, kill the business. Yeah, it's interesting that quite a lot. I mean, obviously there's a million tools out there that actually do scrape Amazon, because there are ways to scrape without them knowing. But if you have the data in your software, when they check out your software I assume they're going to ask you where it came from.

Speaker 1:

Yeah, well, I think there's usually a bit of like a gray line, like you're either primarily a scraper or primarily accessing the data, and it's usually not so much crossover, and so you just sort of have to decide where your business sort of lies now. And the other one is, if you're using scraping data, it can't be live because you have to do this very regularly. So for high velocity items, if you were trying to make decisions based on competition and you're relying on scraping maybe you're scraping once a day, maybe you're scraping once an hour, but a high velocity item you actually might not have up-to-date data to make those decisions, and that could leave you in a pretty difficult predicament.

Speaker 2:

That makes sense. Is there any way through, just out of my interest, through the SP API? Is there any way of tracking competitors in the same space? Or would that all be scraped? Is that all front-end stuff?

Speaker 1:

no, so that's how the stuff is possible. So, when you're talking about repricing specifically for competitive listings, there is a an API called the any offer price change notification, and they have one for b2b prices as well, and essentially it's an events driven communication that Amazon provides when there is a change to any, and they have one for B2B prices as well, and essentially it's an events-driven communication that Amazon provides when there is a change to any offer on a listing. So if any competitor leaves a listing, leaves an ASIN, joins an ASIN or changes their price or there is a change in the buy box price, this notification is sent automatically, and so it's that data in the any offer price change notification that reprices used to make price changing, and so it's that data in the NEA price change notification that reprices used to make price changing decisions, because it's real time and accurate.

Speaker 2:

Oh nice, and I guess Amazon's providing that for you specifically, so you can do exactly what you're doing, which is make the market as competitive as humanly possible for the buyer.

Speaker 1:

Yeah Well, you need some form of transparency. I think if you didn't know what prices your competitors were at, you would not know how to price so you could be uncompetitive priced significantly above the buy box. Or what Amazon would prefer is you're very competitive below the buy box, drawing down prices, and so when you choose a bad repricing solution or one that doesn't take some of this stuff into consideration, it's very easy to go oh oh, we should be priced below the buy box, that's how we'll win. But inadvertently you ruin, um the you know you ruin the buy box for everyone, you ruin everyone's profitability, and so you know a good repricing solution will make sure that you're winning the buy box at the highest possible price and getting the buy box share that you deserve, without lowering the price to a point where you're liquidating stock and losing out on those margins.

Speaker 2:

Cool, and if you're reselling a product over and over again, you're restocking and you're replanning it. Does SellerSnap also help with inventory insights, inventory management, to make sure that you stay in stock?

Speaker 1:

Yeah, so we definitely do. We have a replenishment suggestions tool and this is, I guess, good for wholesalers but also for private labelers. We have an advanced analytics platform which we're always evolving, and one of those tools is our replenishment suggestions on your inputs, being how long it takes you to get inventory into a fulfillment center, what to manufacture, whatever it might be, when you should reorder and how much you should reorder to maintain that sort of sell through and to maintain that inventory supply. And you know, especially in 2024, where there's been such a big push on, you know, sort of historical days of supply and the low inventory level fee, having that ability to have some informed decision making on when to replenish and how much to replenish can be really helpful for sellers to make sure they're not getting those higher fees.

Speaker 2:

So, yeah, I guess when people are using your tool, they'll have a lot of not always, but there might be quite a few customer support issues of why things aren't showing up. This is happening, that's happening. Where does your line stop and what can you help people with kind of as part of your customer support?

Speaker 1:

Yeah, it's a great question, John. I think that repricing is a very hands-on type solution type need for sellers and creating the right repricing or price optimization strategies takes time and care. Now our solution could be very hands-off it's an algorithm so you can set your minimum or your floor price and your maximum, your ceiling price, press go and the system will just make decisions that are in your best interest. But some people want to be much more hands-on and those people have access to our account management team who are brilliant at strategizing based on your needs and your business objectives. One seller might want to liquidate stock because they're not replenishing and another seller might want to make sure they're maintaining profitability because they're constantly replenishing.

Speaker 1:

And to us, our team will be with you very regularly, very hands-on, to craft specific strategies for your business needs and make sure they're constantly readjusting to make sure that you're being as profitable as possible or meeting those goals. And that's a continual service that we provide throughout the lifetime of your contract and even before, during our 15-day trial. There's no point in putting you into our system and then not providing support to get you set up, because you're not going to have a good experience and you can do it and some people like to learn by themselves, but everyone is available to get free onboarding sessions without you know, onboarding specialists and account managers throughout the lifetime of their time yourselves now cool and I guess if someone is trying to resell or if they're doing reselling as well as their private label, what kind of volumes they need to be doing to get value out of your service?

Speaker 1:

Yeah. So I guess it depends on your size. You know we have a few different models and feature sets that are available and I would say that you know, for most sellers, you know making anywhere above. You know $5,000 to $10,000 a month. There is some service offering that SellerSnap can support with. You know five to $10,000 a month there is some service offering that SellerSnap can support with.

Speaker 1:

At the end of the day, if you can increase your profitability on all of your products by a few cents each, you pay for the increased cost of using a repricer. And so really it's, you know, as we say, it's talk and cheese, it's black and white. You're running a business and if you turn on the solution and you're seeing your profit go up by more than the subscription cost, it's an easy decision to make. And so my sales team, who is part of that onboarding team, really holds your hand through this and they'll show you since you've turned on repricing. These are the listings that we've seen increase by the average sale price by 15 cents or 20 cents, and you a hundred units in the last week. So, based on that, this is how much additional product profit you made from this specific product and they'll drill down with you so you understand the value proposition and at the end of the day, it's just is this value for me and my business? And it's a pretty easy decision makes a lot of sense.

Speaker 2:

Sounds like a great business decision for a lot of people. Okay, cool. So we're going to move on to the part of the podcast episode where we talk about your controversial take. I think americans call it a hot take. Um, what's your most debatable or controversial opinion related to amazon or the e-commerce industry?

Speaker 1:

there's probably a lot of them and I think they they flip-flop day-to-day based on. You know what's the the controversial thing going on on Twitter regarding e-commerce and Amazon. But I think probably the most important thing to sellers at the moment is making sure that they're hitting all channels. What do I mean with all channels? I mean you're hitting all customer segments specifically offering products in Amazon B2B and Amazon business, and I think a lot of sellers don't understand that there's actually two buy boxes and Amazon those for set by consumers that have put a business credit card in and those for consumers that don't have a business credit card in, and when you are selling to businesses, there is extra requirements that they need, especially in Europe.

Speaker 1:

But they also demand better deals, quick shipping times and in you know, like I said, in Europe you also need to be able to guarantee invoices. You need to be able to guarantee that things are delivered between enduring business hours, and so if you can supply and provide these types of things which, if you're an FBA seller, you can really if you're not offering business offers which are discounted prices for business customers, you're just missing out on an entire segment of opportunity, and I think people that don't get into the segment will lose out drastically. I think they mentioned in an earnings call earlier this year that Amazon Business was now doing $25 billion in revenue every year. That was their run rate, and so it's clearly a huge industry, and if you've got products that you replenish regularly and you have good supply lines and you want to move more products, it's worth doing so and, like I said, those that don't will be left in the dust.

Speaker 2:

Yeah, love it and that makes a lot of sense and I definitely have got friends who've been in the space and sold their businesses, who've done really significant volume through Amazon Business. So I think anyone who's listening that's like a key takeaway from this episode, even just to make sure you're on Amazon Business if you have a product that could be consumed by businesses, which is pretty much most products.

Speaker 1:

I think about everything and a lot of it, and, yeah, I just think that, like I said, people aren't aware of this thing, and they really should be, because it's just missed opportunity if you don't get involved.

Speaker 2:

Cool Thanks, adrian. So if anyone wants to find out more about SellerSnap, connect with you, connect with your team. What's the best way to do it?

Speaker 1:

So head to sellersnapio that's our website and from there there's opportunity to start a 15-day free trial or reach out to our support desk for questions, and also feel free to follow us on Twitter or X X now, I guess or Instagram or on LinkedIn. So we're on all the channels. But my best recommendation is go into our website and fill out an account creation form. Our team will reach out to you to offer you some setup calls and demos to get you going as quickly as possible love it.

Speaker 2:

Thank you for being here and, um, yeah, so thanks for here, thanks for sharing. That's really cool and I think it's definitely a different angle from a lot of what we talk about. So, yeah, we'll definitely make sure that we label this episode clearly for resellers or just people looking to get into amazon, who are wholesalers, because, yeah, there's still so much opportunity and especially because it's a marketplace platform, like, even if you're selling the same thing as everyone else with the software, if you've got the right pricing, then you can you can still make very significant money. So that brings us to the end of this episode. Wherever you've been watching, consuming or consuming in any way, please feel free to rate us, give us some feedback, and that helps us go up the rankings and check back next week for another amazing interview with whoever's up next week. So thanks, adrian, and have a great day.

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