Success Stories
Enterprise Private Label Sees 150%+ Profit Margin Increase in 6 Months
About
Ozan
Enterprise Private Label
Introduction
Espresso Republic is a direct fair trade startup which sells its own brand of premium coffee and top commercial coffee equipment (brewers, machines, and everything around coffee preparation). The company sells through its own online store and on Amazon – being its major channel and accountable for 40% of business sales.
Founded in 2005, the Berlin-based social startup pioneered a new fair trade trend in Germany by working directly with Brazilian farmers – giving them direct profit from the coffee roasting to ensure maximum economic fairness and investing in local community development. By 2012, Espresso Republic —already considered a reputable brand— decided to go after the end-consumer market. It started selling on different channels, with Amazon as its primary focus.
Challenge
Challenge
Stay Competitive While Maintaining High Profit Margin
In 2012, Espresso Republic made the move to Amazon, hoping to drive more revenue and growth. The move was far from smooth. They quickly found itself in deep waters trying to reprice hundreds of SKUs for its competitive and non-competitive products. The next natural step was to build its own crawler to retrieve prices from Amazon, but that proved to be ineffective.
Solution
Solution
“We have some products which generate over 40% profit because Feedvisor found the right balance between price, competition, and sales velocity.”
AI Repricing and Data-Driven Actionable Insights
Frazzled by poor pricing methods and insufficient business insights, Espresso Republic understood that an intelligent algorithm could offer a better alternative. In April 2015, it turned to Feedvisor. From there, things took off and the company saw impressive results in six months.
Conclusion
Conclusion
150%
increase in profit margins
300%
increase in sales revenue
13%
increase in Buy Box share
Optimized Margins and Revenue
Since implementing Feedvisor, Espresso Republic has experienced incredible results. Here are the top 3 pricing strategy tips they recommend for Amazon sellers:
1. Premium product selection: “Pick quality products that have a future and are trending (lower competition and high demand). Try to exploit the margins while they are there. For us it’s all about the premium coffee and equipment.”
2. “Pick your systems and circumvent price wars with intelligent technology tools like Feedvisor. Everything we do is based on data, so the more data we get, the more granular we get on certain actions.”
3. “Try and exploit the opportunities on several platforms by going multi-channel.”
“We decided to test out a rule-based repricer, and that was OK for a while, but the repricer’s limitations impacted our performance capabilities and we’d often find ourselves caught up in price wars. We just weren’t receiving the intelligent insights that we needed.”
