What are the best NeuroPrice settings?

There are no "right" settings for NeuroPrice.

And repricing is deeply personal. Your needs are not the same needs as another seller.

For those reasons, I strongly suggest you do not copy what's in this article, and instead watch our "Pricing Strategy" videos to better understand how to set your own rules that meet your specific needs.

This article is only for sellers who are totally new to repricing and have no idea what they are doing. These are meant as training wheels you should evolve out of as quickly as possible.

If that's you: Continue. (Everyone else: Leave this article immediately).

When it comes to repricing your Amazon inventory, the fantasy is to nail down the “perfect” settings and then never have to think about it again. With these “perfect” settings (so the fantasy goes), you will be striking an exact balance between maximizing turnover and maximizing profits. NeuroPrice takes it from there, creating a steady flow of money into your bank account, and the entire concept of repricing can become a distant memory.

The reason this is so important to get right is this:

Repricing decisions compound.

Let’s say you create repricing rules that reduce your profits by 5% vs another, better formula. That 5% compounds over days, weeks, months, and years. That one decision you made when you set up your repricer settings became very expensive in the long run.

With that in mind, it’s a lot of responsibility to spoon-feed you a set of repricing rules in this article. But that’s what I intend to do.

When sellers have asked me in the past to share a repricer settings template for them, or share my exact settings, my response always went something like this:

“I strongly recommend creating your own settings and not copying anyone elses. Pricing is a very personal thing that’s defined by several factors that are unique to you, such as your risk tolerance, how badly you need your investment back, and other factors. So I don’t suggest blindly copying anyone’s rules. Instead, you should understand the principles of good pricing strategy, and set your own rules based on those.”

That answer usually didn’t get a good response. Most people just want a “paint by numbers” repricing formula, a “one size fits all” list of rules they can copy and never think about it again.

So eventually I switched my answer. I began sending them a screenshot of my current repricer settings. And I would get negative feedback like “my sales plummeted after applying your rules.”

So then I created a set of rules that I felt was catered to faster turnover. And I would still get negative feedback like “my margins plummeted after applying your rules.”

I (literally) couldn’t win.

So I’m taking a big gamble by writing this article. I only ask that you read (and agree to) all the disclaimers that come with it (I’ll be giving you several).

There are no “perfect” settings. Repricing is personal. And this is why this article was so hard to write. But it had to be done.

What follows is my attempt to answer the question:

What’s a NeuroPrice formula you can copy that will strike the best balance between margins and sales?

(By proceeding, you are entering into a binding legal agreement that you understand there is no “one size fits all” approach to repricing.)

Let’s get into it…

Most sellers would say the goal of good repricing rules is “to make the most money!” But is that really true?

If it was really about the most money, you would price every item at $1,000. Theoretically, before the end of time, every item would eventually sell for $1,000 (even if it was just because of a drunk midnight Amazon shopper).

Others would say the goal of pricing rules is “to sell my inventory the fastest!” But that’s not true either.

If that was the goal, you would just price everything at 1 cent. You’d get the quickest possible sales that way. But you’d also lost a lot of money.

So both are wrong.

What this means is:

The goal of your repricer settings is to maximize your profits, while still selling your inventory in the time frame you prefer.

That one concept is going to inform the list of settings I’m about to give you.

Seven things to understand about this specific template I’m giving you:

This is what it’s all been building up to.

Here’s a visual of what we’re going to cover, in eight simple rules:

Explaining this rule

For extremely high-demand items (in this case, books), we’re going to look at the 3rd lowest FBA price, and price a full dollar above that.

Example:

The strategy behind this rule

With high-demand items, it almost doesn’t matter how you price. In the Books category, an item with an Amazon Sales Rank in the four-digits is selling dozens or hundreds of items a day. Prices are fluctuating so rapidly that it’s pretty useless to price in relation to the lowest price. That “lowest price” is likely to change in 10 minutes.

So when something is selling in such high volume, the lowest price could jump from $9 to $13 to $10 to $11 to $8 and back again all within a day. And while the swings aren’t normally that dramatic, you’ll find that almost everything sells at any price as long as it’s somewhere in stone’s throw of the lowest.

Same goes for the Buy Box price. You can match it, but you’re leaving money on the table if you chase the Buy Box price because it’s changing so frequently.

You might be thinking: “Hey Peter. I'm repricing many times per day. If I’m always above the 3rd lowest offer, won’t my product never sell?”

Actually that’s not true either. When it comes to high demand products, the sale can go to higher priced offers all the time. Maybe a buyer likes your condition better. Maybe they like you condition description better. Maybe they like your store name better. Maybe they are drunk at hit the wrong button. Point is: When there’s so much activity, anything can (and does) happen.

It sounds a little crazy at first, until you start to pay close attention to these high-demand items. You often don’t need to reprice them at all. Just throw them up on Amazon and that 5th or 6th lowest price can often be the lowest in a very short time frame. People think prices on Amazon only go down. They don’t.

Final note: You’ll notice that this is the only pricing rule we aren’t going to adjust as the age of the inventory increases. That’s because high-demand items simply don’t need to be maintained to that degree. They’re going to sell. So just let nature run its course.

Explaining this rule

With this Sales Rank range, we are still dealing with products selling at least once a day. We are just going to match the 3rd lowest FBA price for these. Would not object to pricing slightly below the 3rd lowest either.

The strategy behind this rule:

In this Sales Rank Range, we’re not dealing with nearly as high demand as the four-digit Sales Rank items, but with strong enough demand that we don’t need to coddle them too much. Same logic applies as in Rule #1, except that we’re starting to get closer to the lowest price.

Explaining this rule

In this Sales Rank range, we’re dealing with items that have sold in the last 1 to 3 days.

The strategy behind this rule

In this range, we’re still dealing with items in strong demand, but we can’t throw all caution to the wind. And since prices tend to “bunch up” at the bottom, there’s an 85% chance that 2nd lowest price is within pennies of the lowest. So these are still priced to sell, but we’re not blindly anchoring ourselves to the lowest price unnecessarily.

Explaining this rule

We are officially in the range of items that are selling less than once a day. So as an FBA seller, we’re going to still bypass Merchant Fulfilled prices, but it makes more sense to stay at the lowest-priced option for customers who want Prime-eligible offers only.

The strategy behind this rule

These items are in decent demand, but we can’t call the prices “volatile.” So we’re going to aim to be the next sale for buyers who want FBA offers only. We will lose some customers who are shopping based on price alone, but that’s okay. These ASINs have decent demand.

Explaining this rule:

We are now in the territory of ASINs not selling more than once a week. And when we’re talking about Sales Ranks in the millions, it could have been months since a sale. So as an FBA seller, you’re going to ignore other FBA sellers completely and compete with all offers. And that means matching the lowest price – FBA or not.

The strategy behind this rule:

When we’re dealing with such low demand products, we don’t want to miss an opportunity to be the next sale. And while most items sold on Amazon are Prime-eligible, there (of course) many customers who shop solely based on price. And we don’t want to miss any possibility of getting the next sale, or leave anything to chance. Remember: If we miss the next sale, it might be months before we get another shot.

Explaining this rule

This is our first inventory age-based rule. Once a SKU has been listed for 90 days, we want to make some adjustments to inch it towards a sale. So we are getting more conservative as we hit the 3 month mark.

The strategy behind this rule

In Rule #2, we gave these reasonably high-demand SKUs an opportunity to sell by tethering them to the 3rd lowest FBA price. If, after three months, this strategy is not converted to a sale, we should reign in our approach and drop our price to match the 2nd lowest FBA price.

Remember that chances are good this actually doesn’t impact the price that much. Most of the time, the 2nd lowest and 3rd lowest are almost the same. So this isn’t exactly drastic in most cases, but can be enough to influence a sale.

As inventory ages, we want to adjust rules to get a quicker sale while still not leaving money on the table.

Explaining this rule

Essentially we are merging Rule #3 and #4, and turning the vast Sales Rank range of 100,000 to 1.5 million into one rule.

The strategy behind this rule

90 days is a good amount of time to wait for a sale, and while its no time to panic, we want to get more conservative at this point.

Explaining this rule

We need a separate rule for items with no Sales Rank. “No rank” can either mean an item has never sold on Amazon, or Amazon has withheld the rank from being visible for an unknown reason (usually “no rank” means the former, but increasingly we are seeing examples of the latter).

The strategy behind this rule

We are assuming an item with no rank has never sold, so we need to really, seriously aim to be the next sale. I never advise underpricing other sellers in most instances, but if I was going to do it, this would be the scenario. But to keep it simple, let’s just match that lowest overall price and hope for the best.

Note: Since some ASINs that have no rank actually have sold (including some that have strong demand) due to Amazon being weird, there is the potential for collateral damage. You might be setting a price too low for an item that actually has reasonable demand. But since you need to apply Sales Rank to every repricing rule, this is an acceptable cost of otherwise strategic repricing.

I’m on about my 8th disclaimer that this isn’t a perfect repricing formula because there is no such thing as a perfect formula. What are the top changes I would make if wanted to make this either more conservative (faster sales) or more aggressive (higher prices)?

That would look like this:

You may have heard me talk in the past about why it’s a mistake to underprice other sellers, and this may seem like a contradiction. It’s not. My “don’t underprice other sellers” rule applies to the lowest price offer. Underpricing higher-priced sellers doesn’t drive the price down for everyone, and is fine.

3. Match the lowest FBA from 100,000 to 1.5 million. Essentially we are just using our 90+ day inventory age rule and applying to everything day one. I don’t like this personally, but if you don’t like the sales you’re getting, you can make this adjustment.

Self-explanatory.

Here are other rules you should apply to your inventory across the board, that aren’t Sales Rank based.

Compare new to new / used to used only. Set the option to compare your New condition inventory to New condition competitors only (and ignore Used condition), and compare your Used inventory to Used competitors only.

There are multiple ways to add complication to condition-based settings, but I don’t advise it. For example, some choose to exclude Acceptable condition competitors from being considered, or only comparing against the same condition or better. But comparing used to new and used to used is sufficient.

Your repricer should have built-in safeguards to prevent your inventory from ever pricing below a certain amount. I advise two safeguards, just to be safe:

1. Creating a pricing floor. This is an absolute amount that your inventory can never be priced below, set by category. In other words, “Never price a DVD below $7” or “never price a book below $10.” Obviously this is going to be very personal and I can’t know what your buy costs are, etc, but there are some thresholds that keep you from losing money for most items (as an FBA seller):

2. Setting your min/max prices in Amazon. When you list inventory, you are given the option to set a minimum price, and a maximum price for that item. If a price is set that goes outside those boundaries, the item instantly becomes stranded until you fix the price. Enable the setting to always stay inside the min/max boundaries. This is added protection that can save you.

Tell your NeuroPrice how to price when you are in the fortunate position of being the only seller for an item.

Recommended default price: $99.

Yes, this will result in high pricing errors sometimes. But better to go to stranded for a few hours than to price it too low.

You need to tell NeuroPrice how much to price below Amazon, in the event your pricing rules call for pricing higher than Amazon. You don’t want to get caught with an item priced above Amazon’s offer because it’s not likely to sell.

Recommended: Price 50 cents to $1 below Amazon.

Since it would be impossible to present sample repricer settings for every product category, I’m offering one specifically for books. If you want to quickly adjust these to apply to any category, here’s how:

Step #1: Go to Keepa’s “Category tree.” (note: This is a paid feature of Keepa).

Step #2: Find the category you’re trying to apply these settings to. Take note of the number of products in that category.

Step #3: Divide 25,000,000 (roughly the highest recorded Rank in the Books category) by the number of products in your chose category. For example, if you chose Music, the number is 8 million.

Step #4: Reduce the Sales Rank in each of the pricing rules that follow by that amount. For example, since 8 million is roughly 1/3 of 25 million, you can reduce the Sales Rank’s by 2/3. So a rank range of 10,000 to 100,000 would convert to 3,000 to 30,000.

This isn’t perfect, but it gives you a decently accurate way to convert this formula to work for any category.

Let’s recap:

Essentially we gave you a level of “pricing diversification” that balances risk and reward.

-Peter Valley