Congratulations, you’ve finally made it into Merch by Amazon.
You have your designs ready and you know which products you want to sell.
But what price should you set for these products?
Dynamic pricing is always recommended to Merch by Amazon sellers.
Changing the price of your listing depending on the situation often leads to better results as compared to having a set price for all of your listings.
Dynamic pricing means that you can keep an eye on the competition, observe what they are doing and make changes accordingly.
It also means that you can test out different prices for different designs to see which ones perform better.
If you sell designs under more than one niche, then having a set price for all your designs is not wise.
Niches are unique, and they all perform differently.
If you have one price for all your designs, then at least one of your designs won’t be doing as well as you would want it to.
As a merch seller, you will continuously find yourself adjusting prices depending on what is going on within your niche and also how individual designs are performing.
It is important that you remain adaptable to the changes.
In this article, we break down a few factors you should take into consideration before setting or changing prices for your Merch by Amazon listings so that you always make informed decisions.
Price psychology is a marketing strategy that is consistently used.
The basis of it is that certain prices have more of a psychological impact on us than others.
When comparing prices of products in a store, you will most likely take note of a product with a lower price and use that as a comparison and when looking at similar products.
This price will largely affect your final buying decision.
“Charm Pricing” is a classic example of price psychology.
Charm pricing happens when the left digit of a rounded number is reduced by one cent.
So, if competitors are selling their products for $8.00, and you set your price to $7.99, customers are more likely to keep the price of your product in mind.
A study conducted by Thomas and Morwitz showed that Nine-ending prices will be perceived to be smaller than a price one cent higher if the left-most digit changes to a lower level (e.g., $8.00 to $7.99), but not if the left-most digit remains unchanged (e.g., $8.60 to $8.59).”
This psychological effect is rooted in how our brains process numbers.
The process is usually so fast.
If we are casually browsing through an online shop, we don’t take time to analyze why we think one price is lower than the other.
Many companies like Apple, apply this principle in pricing all of their products.
Another interesting example of price psychology is the principle that men like things in red.
A study by Puccinelli found that men are more likely to buy products that are priced in red.
The “BND” or barely noticeable difference is a technique that can be applied in most businesses.
This price psychology is based on the belief that people rarely notice slight price differences.
If you change the price of a product from $14.99 to $15.99, it won’t be as noticeable as if you changed the price to $19.99.
People recognize larger differences.
If you are running a business and feel like there is a need to mark up the price of a product, it would be advisable to make that change gradually.
All these are psychological manipulations if you will, that gets people buying.
These strategies have been used for years both in eCommerce and in physical stores.
So, What Price Strategies Work on Merch by Amazon?
Pricing To Tier Up and for Reviews
This strategy is relevant to Merch by Amazon sellers who are in the lower tiers and looking to level up.
This strategy will not see you make a lot of money upfront but it will help you sell faster and rank higher.
Check out what your competitors are selling for a similar design and set your price lower.
You don’t necessarily have to go too low.
You can implement what we call “photo-finish-trick” at T-shirt Academy.
Many customers are looking to save money.
That means when looking for products, they sort their searches by prices.
To have your design at the top of their searches, you can simply price your design one cent cheaper than your competitor’s.
If you want to rank higher in a short amount of time, you might even have set the lowest price possible.
It is important to note that pricing low will help you gain sales, however, the amount of profit you make will also below the desired amount.
This strategy will also work if your aim is to get good reviews.
If you can make a large number of sales, this means that more people will leave reviews, and if your designs are good, they will leave good reviews.
Once again, this strategy is not for profit.
You use it with an end goal in mind.
If you get around 10 positive reviews on a design, you can eventually increase the price down the road and more people are likely to purchase it.
Good reviews are important in building loyalty and trust among customers and more so with new customers.
People are more likely to buy a product from someone with good reviews.
Reducing Prices on Designs That Are Not Selling
During Merch by Amazon searches, products that are “on-sale” are showcased.
To have your product termed as on sale, you have to lower the price from its initial price.
Products on sale get more visibility and in turn, more people buy them.
To effectively take advantage of this strategy, we would advise that you put the designs that are not selling as well on sale.
Since these designs are already struggling, dramatically reducing their price might give them the visibility required.
It is important to lower sales during seasons such as Christmas, and New Year’s.
Right at the beginning of the sale period.
Once this period is over, you can gradually mark up the price of these designs by $1, monitor how it’s performing, and continue to mark up until you find a price that’s high enough while still getting buyers.
Apart from bringing back your dead designs to the eye of the public, you will have lowered your BSR.
As any Merch by Amazon seller knows, the lower your BSR, the higher your products rank, and the more sales you receive.
Premium Merch by Amazon Pricing Strategy
This technique is as simple as it sounds.
Price your designs high from the beginning.
If you have good quality designs and you have optimized your product listings so that they show up in front of your intended target audience, then this strategy might work.
This strategy might be risky and you should only get into it if you can master these two factors.
Pricing high is also an advantage when you are selling premium shirts.
If you set a high price, you will be able to get free shipping on your products.
When making their buying decisions, this will be a factor that many customers will take into consideration.
Designs with higher prices also gain higher royalties and after all, we are all after the profit.
If you are a new seller, you might want to stay away from this technique until you understand how Merch by Amazon works.
Premium pricing also works well with known brands.
This is why reputable stores and brands consistently price their goods at a high price point, and they continuously get customers.
If you already have a brand that is established before coming to merch, then having premium prices might work for you.
This strategy is not for every seller, even Merch by Amazon has said that your designs have to be of the highest quality if you want to pull off this strategy.
The Alpine Strategy
The alpine strategy is similar to the second strategy on this list.
However, unlike the second strategy, you start off by pricing your products low from the beginning.
Once you do that, you gradually increase your prices until you hit the sweet spot.
This strategy is similar to climbing a mountain.
You have to start from the bottom to get to the top.
Unless you are able to invest heavily in additional resources such as advertising and using other marketing techniques, you may need to start from the bottom.
But a lot of sellers have risen up the ranks through this method.
This method also gives you the opportunity to test out the market.
With every new design, start by pricing your product low.
By saying pricing your product low, it does not necessarily have to be the cheapest price of all the sellers.
Once you see how the design is performing, you can gradually increase or maintain its pricing.
If a design is selling, keep reasonably increasing its price.
If you increase it and find that people are not buying, then the best thing would be to lower it to its lower price point.
You continue moving the price up to and down depending on how each design is fairing on in sales.
Pricing for the Market Average
In this strategy, you will want your design to be marginally lower than the average in the market.
This means that while your listing will be lower than the average, it will still be competitive.
If the average price is $16, you may want to price your product at $15.99.
This will take advantage of price psychology while still making sure that you are still able to gain a profit.
Every Cent Counts
The difference between setting your price at $17.90 and $17.99 might not seem like a lot, but this cost adds up with every design that is bought.
There is also the psychological effect of setting prices ending with 9.
When you’re trying to make a profit, every cent counts.
Merch by Amazon is a very price-sensitive platform.
Pricing not only affects the number of sales you make but also affects your ranking.
There is no one strategy that works for all Merch by Amazon sellers.
Look through these different strategies and find which one appeals to you and the goals you have for your store.
Sometimes, you may have to try out different strategies before settling on the one that works for you.
You may even implement different strategies all at once depending on the different designs that you have available.
Remember that as much as pricing is a big factor in people’s buying decisions.
People on Merch by Amazon make decisions with their eyes first.
Make sure that you have good quality designs.
You cannot set a high price for a substandard design.
It simply won’t sell and you will have wasted your time.
The strategies mentioned in this article can be used by both new and experienced sellers.
If you are a seasoned seller, reading this will provide additional insight that you can use together with the strategies you are already implementing.
Remember to also consider your ranking, do not go with strategies that make it harder for your designs to show up on customers’ pages.
It is also important to understand the niche that you are selling under.
Not all strategies will work for all your niches.
Understanding why you want to set a certain price is a big factor in which strategy you will choose.
Do you want to make more sales?
Do you want more reviews?
Do you want a lower BSR?
Do you want to appear at the top of searches?
Do you want to earn higher royalties?
Or do you want sustainable long-term success?
There is no wrong answer to this question.
You might want to fulfill some or all of these needs.
Once you know what your end goal is, you can now choose a strategy