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How to Build a Killer Private Label Pricing Strategy

By Tami Ben-David March 23, 2016
How to Build a Killer Private Label Pricing Strategy
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About the Author

A British ex-pat, Tami been writing and content-strategizing for Israeli tech start-ups for the last 5 years. When she's not writing nerdy content, you can find Tami on open water charity swims or traveling to far-flung countries.

This is the second of our two-part series on how to avoid the most costly private label pricing mistakes and implement an effective private label pricing strategy.

In our first installment, we discussed the main pricing challenges incurred by private label sellers. Now, let’s uncover the solution.

ProductSphere™ Pricing Technology

Feedvisor’s ProductSphere pricing technology is specifically designed to help you maximize profit margins for your branded and private label products, ultimately accelerating your private label business growth. You do not need to input any rules or identify any reference products. Our highly intelligent machine-learning algorithms map relevant competing products for each product in a client’s catalog, as well as complementary and substitute products. 

Through an explore-exploit methodology, the algorithms continuously search for the optimal price point and make real-time adjustments, enabling clients to achieve their target business strategy. You can then understand the influence of price changes on demand while the algorithms continuously monitor and optimize pricing on an ongoing basis.

How does Feedvisor’s private label solution enable you to price more competitively? The key benefits of the AI-based pricing technology are outlined below.

1. Save Time by Going Automatic

While the majority of top Amazon sellers use a repricing solution for their competitive products, until now, no automated solution has existed for private label sellers. Prices were manually updated, which was a tremendously time-consuming process.

The Benefit: You can save yourself a significant amount of time by dynamically pricing each of your products.

2. Optimize Prices for Revenue or Profit

How do you know you are not leaving money on the table by pricing too low or encountering lower profits than you should be because your price is too high? Feedvisor’s proprietary pricing technology lets you set the pricing strategy according to your business objectives and then prices your products appropriately.

It then continuously monitors and optimizes pricing through closed-loop machine-learning algorithms. With the ability to manually customize the optimum balance between revenue and profit, you can effectively achieve your business goals at any stage of the product’s life cycle.

The Benefit: Because the technology is automated, you have complete assurance that your price point is optimal and will drive the most profit possible. The price is updated as necessary.

The way the technology works is by identifying competing, complementary, and substitute products on a SKU-specific level through machine-learning algorithms. Then, it identifies who you are competing against and who is taking demand from you, and understands the impacts of price changes on demand. Then, it identifies the optimal price according to your business objectives, such as revenue optimization, profit, or liquidation.

Example: The current price you are selling your private label shampoo for is $5.58. You are debating whether or not to raise the price slightly and risk losing sales, or lower the price slightly and risk lowering profits. A demand curve will help you identify the optimal price for your shampoo so that you are making the right amount of sales to bring in the most profit possible.

3. Accelerate End-to-End Business Performance

When utilized in conjunction with Feedvisor’s other optimization solutions, dynamic pricing holistically drives demand, profit, and revenue growth across your entire Amazon operation.

Final Thoughts

The benefits of AI-based, dynamic pricing for your private label products are unparalleled. Click here to learn more about how ProductSphere™ pricing can enable you to win against the competition on Amazon.

Learn what Feedvisor can do for your business.

When you partner with Feedvisor, you automatically receive access to our true, AI-driven technology and hands-on team of e-commerce experts. Contact one of our team members today to learn more about our end-to-end solution for brands and large sellers on Amazon, Walmart, and e-marketplaces.

Maximize Demand, Profits, and Revenue With Feedvisor

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