In the product selection operation of Amazon sellers, price is also a powerful tool to increase traffic and sales. Therefore, before a new product is put on the shelves, product pricing is also an important link. Before pricing, sellers should know what factors affect product pricing?

1. Product cost

Product production has costs, including product development, raw materials, factory costs, etc., which are still the cost of purchasing from the factory.

2. The relationship between supply and demand in the market

There are two kinds of supply and demand in the market. One is that there are many products and few buyers, that is, when the supply exceeds demand, the price must be low. However, when there are few products and many buyers, i.e. there is an oversupply, the price will naturally be higher, that is, scarcity is expensive!

3. Amazon platform commission

If a seller sells on Amazon, Amazon will take a portion of the commission. Commissions are differentiated by product category. Different product categories will be charged a different percentage of the commission.

4. Product brand image positioning

This depends on the seller's positioning of the product brand, whether it is a product market of high-end brands or a product market of mid-to-low-end brands. For high-end brands, the audience of the product must be people with relatively high income and strong spending power, and the price can naturally be set higher. For mid-to-low-end brands, the audience of the product is people with lower spending power, and the closer the price is to people, the better.

5. Competitive product price

No matter which platform the seller is on, the seller's product cannot be operated by the seller alone. If there are competing products, there will be competition. Therefore, we must understand the products and prices of competing products. The price can be slightly higher if the seller's product has an advantage in quality over competing products. After all, there is truth in every penny. Merchants understand this, and buyers understand that sometimes prices are higher, and buyers may choose good products at high prices.

6. Expected profit

When sellers come to Amazon to do e-commerce, sellers have to make money. First, eliminate the cost of the seller's investment, consume a lot of human and material resources, and then have the expected profit for the seller's product. How much money a seller wants to make must consider pricing.

The last thing to say is that the most important thing about pricing is to do a good job in the brand positioning of the product, whether it is a high-end brand product or a low-end brand.

Article source: EXNESS Forex