Mike Danford is a Growth Optimizer – CSO, UX Strategist and Product Management Consultant at Adverio.io
In this podcast, Mike shares valuable insights on optimizing pricing strategies for businesses, emphasizing the importance of testing and adjusting prices regularly to stay competitive. He discusses the complexities of Amazon’s Buy Box. He also provides practical advice for businesses with tight margins, highlighting how small pricing adjustments can lead to significant improvements in profitability, especially when using dynamic pricing strategies.
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Why you have to check out today’s podcast:
- Gain actionable strategies for optimizing pricing in competitive markets with concrete examples of how small pricing changes can impact profits.
- Learn about the complexities of Amazon’s Buy Box, including how pricing, seller ratings, and competition affect your visibility and sales potential.
- Discover how to leverage dynamic and intraday pricing strategies to stay competitive, including tips on when and how to make real-time price adjustments.
“If you haven’t tested pricing, do it today. Don’t wait. There’s no better time than right now.”
– Mike Danford
Topics Covered:
01:36 – What paved his entry into pricing
02:21 – Explaining how in B2C dynamic pricing is critical to staying competitive across platforms like Amazon and Walmart, where frequent promotions and price changes impact rank and visibility
03:27 – Defining ‘Omnichannel’
03:59 – How brands sell through these omni channels and how brick-and-mortar sales data can be integrated with online data to enhance omnichannel strategies
05:03 – ‘Omnichannel pricing’ and the challenges that comes with it
07:20 – A strategy used to avoid direct price comparison
07:45 – Strategies for effective omnichannel pricing to maximize sales
12:00 – Describing how price adjustments are often small, typically starting below 3% to gauge elasticity
13:52 – The three main buckets of categorizing pricing strategy
16:15 – Explaining Amazon’s automated pricing tools and third-party repricing software that generally adjust prices dynamically
18:55 – How the Amazon buy box has been a competitive issue since the platform’s early days
21:20 – Hourly changes being typically unnecessary unless there’s exceptionally high product turnover
23:25 – How geolocation-based pricing isn’t possible on major marketplaces
25:08 – Maintaining control over the buy box on Amazon
26:27 – Mike’s best pricing advice
Key Takeaways:
“If you haven’t tested pricing, do it today. Don’t wait. There’s no better time than right now. If you tested it a year ago and you haven’t touched it, or you did it six months ago, do it again. The market is constantly changing. Be willing to make those small changes.” – Mike Danford
People/Resources Mentioned:
- Amazon: https://www.amazon.com
- Home Depot: https://en.wikipedia.org/wiki/Home
- Walmart: https://www.walmart.com
- Best Buy: https://www.bestbuy.com
- Target: https://www.target.com
Connect with Mike Danford:
- LinkedIn: https://www.linkedin.com/in/danfordmike/
- Website: https://www.adverio.io/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: [email protected]
Full Interview Transcript
(Note: This transcript was created with an AI transcription service. Please forgive any transcription or grammatical errors. We probably sounded better in real life.)
Mike Danford
If you haven’t tested pricing, do it today. Don’t wait. There’s no better time than right now. If you tested it a year ago and you haven’t touched it, or you did it six months ago, do it again. The market is constantly changing. Be willing to make those small changes.
[Intro / Ad]
Mark Stiving
Welcome to Impact Pricing, the podcast where we discuss pricing, value, and the quantitative relationship between them. I’m Mark Stiving, and our guest today is Mike Danford. Here are three things you wanted about Mike before we start. He is the CSO at Adverio. It’s an omnichannel growth company. Can’t wait to hear what the heck they actually do. He spent several years in the insurance industry and he’s a hybrid athlete emphasizing strength training and endurance running, and I am so jealous. Welcome, Mike.
Mike Danford
Thanks for having me, Mark. Looking forward to it.
Mark Stiving
It’s going to be fun. How’d you get into pricing?
Mike Danford
Well a lot of brands that come to us… Everybody’s focused on advertising, marketing, et cetera, and we work with large catalogs and we run a kind of come up with a pricing audit, and it’s pretty common to find out that they don’t change prices and it could be years or they don’t try to keep up with the market trends, et cetera. and then we found that it’s a way to kind of help revamp and kind of boost the product lifecycle or pull it out of a decline. So, my original first foray into it was actually repricing because I was a reseller on Amazon, and it’s obviously changed since then with algorithmic updates and whatnot, so.
Mark Stiving
I work a lot in the B2B space, but it certainly seems to me that in B2C people are changing prices all the time. Am I missing that?
Mike Danford
No, you’re exactly correct. And it seems to be more important now than ever. Different platforms will have sales site-wide or otherwise, and then you’ll have individual brands run promotions or somebody will change and you have to kind of follow it or you lose your rank in your comparative conversion, et cetera, than those other brands on that platform. I feel like it’s less, it’s a slower, less reactive environment when you’re on your D2C, your own website, where you’re not directly against competitors’ price comparison right beside each other. I think you can be a little more dynamic. And then, like I mentioned, the other pieces, if you’re on omnichannel and you’re on Walmart or Amazon plus Macy’s, et cetera, they’ll run promotions on those other sites, and the major marketplaces will actually remove you from being able to be purchased in the buy box if you don’t follow those prices. So there’s a lot of factors now, way more factors than there ever have been.
Mark Stiving
Yeah. So we don’t talk about this much on this podcast, so, define for us omnichannel and then give us an example that you work in that we would all be familiar with.
Mike Danford
Sure. So omnichannel, as I would explain, it’s just your own more than one channel. And typically for us it means marketplace or primary marketplaces. We also have D2C coverage, as well. For us, the most common omnichannel pairing is going to be one, Amazon, Walmart, and or Target. Most of them are Amazon and Walmart. There are a few that are only all three. And then you’ll have other marketplaces as well, Best Buy, Home Depot, et cetera.
Mark Stiving
Okay. So if I’m on Amazon and Walmart, do I also have my own website? Am I selling direct?
Mike Danford
For us, the brands that we work with, your mid seven to mid eight figure brands? Yeah, you’re going to have to have some kind of online presence that’s more than just a website or URL. Those days are gone, Amazon and Target specifically. You’re going to have to have proof of a certain level of uni-velocity before you even get invited to that marketplace.
Mark Stiving
Nice. And then, I hate to say these bad words, but what about brick and mortar? Does that fit here?
Mike Danford
It does. Walmart specifically is getting much better at being able to bring that physical retail data into your online data and allowing you to kind of commingle and pull that in as well. But for us, for the most part, very few brands that we interact with have any kind of their own dedicated store. Now, they’re going to be in shelves on some of the other retail stores, again, Walmart’s, Home Depot, bike shop, little small merchants, et cetera. So that we’ll have some being in the presence for sure.
Mark Stiving
Okay. So now that we have the table set, what are some issues that we think about when we think about pricing in this omnichannel world?
Mike Danford
I think the biggest thing is you’re going to have to have them communicate, and it seems that, and you have to follow. So Amazon is really, it’s probably the most robust and the most reactive to any price changes, all for their platform. They want to be the cheapest price available, and if they find their price for your product, you have the same SKU, same ISPN, same et cetera, barcode, UPC, then they’re going to pull you back on that. Either they’re going to force you to match the price, which you can do that in the platform to kind of do that, or if it’s outside your parameters, they’re going to pull you from the buy box or you’re going to lose sales and you got to update it. And so you have to be careful with that. As I mentioned earlier, Macy’s and a few other marketplaces have a promotional calendar, but they don’t exactly tell you when they’re going to run those promotions.
So you have to be responsive to that. And the more marketplaces and channels that you’re on, the more signals you have to be mindful of. And for us, again, when we get the brands to be able to use Amazon as our true north and everything kind of follows that, it’s much easier and it seems to be less impactful on the aggregate across their marketplaces. A few brands they’re not able to do that just because of the arrangements they have with certain marketplaces, and you just have to kind of bite it. And then another challenge is we have some ways to say, ‘Hey, this is a very, very, very, very similar product, but let’s’ call it a different product line, or let’s change the thread count, or let’s change something very small so that if it’s cheaper on one marketplace, Amazon doesn’t see it as the same product.’
So you can kind of say it’s a little bit of a gamification. We have some brands that do that very strongly. Some brands that are in Costco have to do that. It’s just, it’s what’s necessary. Otherwise, you’re constantly losing the buy box for certain products in your house. People who will buy the product from Costco and then list it on a certain marketplace such as Amazon, and then you lose your own product selling potential. So you want to give those resellers a place to hang out and not interrupt your brand sales on those marketplaces. And the list goes on and on. I’d be happy to dig in more, but those are the big ones that come to mind.
Mark Stiving
Yeah, so I remember many, many years ago when I was in consumer electronics a lot. We would see, especially TV manufacturers build a specific model for Target and a specific model for Best Buy. So I couldn’t compare the prices between Best Buy and Target. It’s like, well, they’re different TVs, which one do you want?
Mike Danford
Yeah, we definitely do that. and you have to get creative and smart around it and figure out if it makes sense. And then sometimes you just make the decision that the product shouldn’t be on all the marketplaces, or let’s just not put it in that marketplace, or let’s split it in different times. Let’s rotate the inventory. There’s all kinds of ways to do whatever works. Less is more sometimes.
Mark Stiving
Okay. So these are interesting problems. What’s the strategy for the solution? How do you guys think about this to make it make sense for your clients?
Mike Danford
A lot of times it depends. If they’re already on the marketplace and we have historical data that we can look at, if we’re getting into a new marketplace, it’s kind of tranching out how we’re going to release, what perceptions of the catalog we’re going to put on each marketplace, and see how it reacts. Because a product line that will do well on, say Amazon will not do as well or similarly comparable on Walmart or Target, and vice versa. And there are different audiences, different target demographics, specifically with Walmart versus Target that you have to think about. And the type of products they’re looking for are going to be different, especially if you have premium and non-premium offerings. You have to be mindful of that and try to cater it for sure. And then the other is looking at the historical data and understanding a lot of times being on more marketplaces doesn’t raise the entire tide, right?
Doesn’t raise all the ships. Sometimes you just lose the sales from Amazon and they end up going through Walmart or through your own website, et cetera. So trying to measure that and get that correlation and making sure it’s the causation is correct. And that is fun for us. That’s getting into your multiple marketing mix models, et cetera, and understanding that. And then knowing when to pull off of a platform because it just doesn’t make sense. We’ve had someone just pull some inventory out of one of the retailers because they were, they lost control of pricing. And as I mentioned earlier, Daisy changed and it was blocking like 30% of their catalog and pulling them off with the other marketplaces. So they just pulled it from the shelves instead ended that relationship because the new relationship was better, at least at this time. Maybe they can go back to that relationship, that partnership and that marketplace later. But it’s a dynamic thing. And yeah, I’m going to stop there.
Mark Stiving
That’s okay. I haven’t heard the answer yet. I mean, I haven’t heard something that says, ‘Oh, here’s how we want to think about where we put our products and how much are we going to charge for our products on this platform versus that platform. Any thoughts or advice for people?
Mike Danford
Yeah, so again, you have your, we call it threshold. You look at the unit velocity as a big part that we put in there. And then there are going to be to understand what the day of day or even intraday changes may be at a product level. And we can pull that data usually 24 to 48 hours later. And we do that. So the price that you have on Monday may be different from the price on Friday. You also have to play the game of not moving your price too much at one time and understanding where the demand curve and the price elasticity kind of intersect. And that would be, that takes data, that takes having the actual data points to understand where that is historically. And once you find the intersection and you’re trying to move within that, and that intersection will change over time, and you just have to keep an eye on that. And you have to be flexible as well. And then there’s other ways if say you’re pricing it’s not the price you want, you got to figure out how to increase the value on that listing, how to add more or take away or bundle or virtual bundles or, I mean, it’s all kinds of other options to try to get the price, get the LTV that you’re looking for as well. That’s another thing. Get to pull LTV in as well.
We have anchor strategies. I mean, there’s all kinds of things. We work with, again, large catalogs, high multivariate catalogs. So if you have a certain size, color variant, something of that nature that’s not moving as well, can you just tweak the price where it’s more or less than the others that are in that group? And how does that change sell through relatively speaking or otherwise? There’s so many tactics and it’s not one size fits all. Certainly not across brands and not even within the same brand or catalog. The market’s so dynamic and you just kind of you have to spray and pray a little bit, and then we just have to be careful and read what works and then continue that and be willing to be nimble and adapt and no, set it and forget it here. And then seasonality plays a big part in it. We have to be mindful of that. We have a bunch of tent poles across the line of brands. We just came off of the one for Halloween for a couple of brands. We have different holiday events, obviously Q4 is a big one as well. I mean, there’s a lot of other factors that go in there.
Mark Stiving
Nice. When you change prices, what percentages do you change? Is it like a big 10%? Is it 1%? What are you looking at?
Mike Danford
So each platform will have its thresholds and a larger percent deltas in a certain amount of time, you’re going to get kind of slapped on the wrist for that. So for us, we also want to do it small to understand if there’s any elasticity. And to answer your question directly, the percentage is usually less than 3% in the beginning. That’s kind of just, just see what happens. And then from there, if there’s not much change and you’re going to increase, sometimes the 3% delta is going to make a big impact and it will either increase unit velocity or decrease, et cetera. Other times we can see 10, 15, 20% changes for whatever reason before we have a noticeable impact, or also we factor in unit velocity versus the gross contribution dollar at the end of the day to see what the difference is.
Yes, my velocity is less but I’m still making more at the end of the day. So there’s a lot of parts that come into that. It depends on the product, the margin. Each platform has different fees. So we have apparel brands where if you stay within a certain price range, you get a significant reduction in that platform’s fee for that category. So you have to play within that. And then another way is to reduce the fees to help with the pricing, et cetera. Once we hit the floor, or this is the ceiling, this is where we can go. Now it’s how can we, again, reduce those fees? How can we move to other things that kind of play against that as well? And there’s a bunch of tactics about coupons and there’s shopper specific coupons, and there’s deals and there’s stacking coupon. I mean, there’s so many ways of getting into manipulating price or adjusting price outside of just a dollar cents that you see when you look at the buy box.
Mark Stiving
So what I find interesting is, are you guys essentially testing a bunch of things just to see what works? Or do you have strategies of how our buyers are behaving and so we think this strategy is going to work for this product or this situation.
Mike Danford
So we have three buckets. Whenever a brand will come to us, your first bucket is the obvious bucket. You haven’t changed your product or your pricing. There’s, we don’t know if there’s any elasticity and or there’s just not enough unit velocity or orders to give us a statistically significant amount of data. So that’s the first bucket. And the second one is that once we can basically sense that the pricing is too high for the unit velocity that’s required in order to get you to that next level. So that’s going to be more of a, let’s reduce price and see if we can get the lift, the rank, the, the boost of unit velocity out of it. Then the other is, ‘Hey, your unit velocity is really high and we don’t think it’s going to change much if any, so, let’s increase your price. And we’re trying to do that. So those are the three buckets that we primarily go to. And that is mostly dealt with your historical data up to two years. From the time that we connect to the account to look at, there’s also external data. What’s your price? Some platforms will actually give us the median price across the competitors or your closest competitors. We can obviously scrape your closest competitors as well and say, ‘Hey, here’s where your price is.’ We also work on a, we haven’t named this yet, I need to put it in there, I need to come up with an acronym for it. But basically a range or a delta of your review count and or review rating or quality versus your competitors to understand what that elasticity is. Maybe you are a hundred reviews less on average than your competitors and people don’t really care. But if you’re a thousand reviews less or they have a thousand reviews more, then prices are going to be more impactful or less impactful. So there’s other ways like understanding how to do that. And that’s the fun part. That’s where all the AI and large large models come in to play for sure.
Mark Stiving
Nice. So, let me tell you a story from a few years ago, probably more than a few. And I just want to hear you tell me what you think happened. So, my very first book was Impact Pricing. it got out of print and I was watching the price on Amazon and it went up to $250. Now, I’m positive nobody paid $250 for that book. And so just for kicks, I happen to have 50 of them in my closet. I’ve opened up my own store, I put them for sale for $25. And over the course of the next week or so, I watched those $250 prices come back down to about $25. So I assume this was all automated pricing, but I don’t know that, what do you think just happened?
Mike Danford
Well, there’s a few things. First thing is, was the condition the same? Were they both used or new? And that’s the first thing that pops on.
Mark Stiving
I don’t know the answer, but I don’t remember.
Mike Danford
Then the other parts, which platform was that? Did you say it was Amazon specifically?
Mark Stiving
It was Amazon, yeah.
Mike Danford
Okay, so you’re going to have offers and then you’re going to have… That’s a great question. I mean, that big of a delta is pretty wild. So most brands, if they’re setting it up correctly, if your price goes too high, they’re not going to follow you. Or if you go too low, they’re not going to follow you. They’re going to have a ceiling and a floor there. But, somebody should have had a lower price if there was another offer that was available. Now, at the time, if that was the only offer that’s available, and then that’s what Amazon’s going to select, however, I would still be surprised if they actually won the buy box of that $250 price, which means when you land on the listing, you can buy right there. Otherwise you have to go another couple clicks, look at all buying options and then select it. I would be very surprised if Amazon allowed a $250 price to be in the buy box. So that would be my additional clarification.
Mark Stiving
Yeah. So what do you think happened though? Was it automation that brought the price down? Is there an automated program that people are using?
Mike Danford
So you have a native automated pricing inside of Amazon, you have resellers, so people who aren’t actually selling their own products, et cetera, they’re going to have dynamic or the repricing software, which is what I mentioned I started with seven or eight years ago. That’s one. And then others, yeah, we’re talking about, it’s called dynamic pricing, which is where you’re trying to manipulate the buy box and trying that elasticity, but not 250 and that’s 10X. That’s just not normal by any means. And then to your point about following most of the rules, the third parties that you can plug in are going to be, there’s a unit velocity. So a lot of times, hey, increase price if unit velocity is here, or if unit velocity drops decrease price within this range to see if we can get the velocity back. But again, that’s quite an anomaly with the 250. So I don’t have a, that’s not normal behavior by any means.
Mark Stiving
Yeah, I didn’t think it made any sense, so I just thought it was fun to watch and fun to play.
Mike Danford
Yeah. Again, if my final answer is that one, I don’t think it was actually in the buy box and two, it would’ve been the only offer available from the only seller. You didn’t have more sellers than one on that. And in order for it to be in the buy box, it would’ve an increase like stair steps a certain number of days over time, and a certain percentage or Amazon would’ve just poured right out and wouldn’t allow it to be in the buy box.
Mark Stiving
So how long has the buy box been an issue? Because in all honesty, I hadn’t heard about that until probably two weeks ago. I read an article that talked about Amazon turning off the buy box.
Mike Danford
Yeah. So, it’s pretty much since day one because I remember Amazon came out as a book store, and had multiple people who could sell the same books and textbooks, et cetera. It was more of a lot of people fighting for the buy box. They had that technology. They were probably one of the first multi-seller offering platforms for a particular product. So it’s always been there and it changes each year. It’s kind of a different thing. It comes into seller ratings. So how many products have they sold in the last 3, 6, 9, 12 months? What’s their lifetime rating? What’s there is actually the quality of the rating, the quantity of the seller ratings, not the product rating. Those all come in. And then you have multiple, there’s apps that come out where I can scan with my phone. Any product in it will tell me what’s the historical pricing range for this, how many sellers that normally have. And you can look at all this, it’s what I used to do when I bought and sold Nike’s. It’s always a thing. And then the other part, if it’s your own brand and you have a brand registry in Amazon or certain other marketplaces where you should be the only one that can sell the authentic product as listed, you still have what they call hijackers will come in. But some brands can’t get a brand registry. We have one right now that’s an Australian brand that’s an Australian trademark. And the U-S-P-T-O is not accepting it because it’s too generic of a term but it’s not too generic of a term for Australia anyways.
So it’s always little things and you’re having to navigate that and you’re just trying to figure out how you can protect your buy box, especially if it’s your own products, your own brand, et cetera. And if you’re reselling, it’s just a game to what you mentioned with the book, ‘Hey, this is my range. I want to sell the product. I don’t want to sell it for less than this or more than this. And I don’t care if there’s a hundred units in front of me. I’m going to wait until those hundred units are sold and I’ll sell my 2, 10, 15, whatever units they are. or Hey, I need to move these because they’ve been sitting on the shelf, I got to liquidate. And you might be more aggressive or then the fun part is you can put in like, it’s not necessarily just their price versus your price. It’s going to pull in their rating, their quality and stuff over time. Just some of the other factors as well. But buy box has always been an issue. As I mentioned earlier, if you have your product on other websites that’s going to, external factors will come in and Amazon will let, ‘Hey, your buy box is suppressed because your prices are lower elsewhere or vice versa.’ So there’s more. It’s getting more and more involved for sure.
Mark Stiving
Yeah. So, I want to change my prices hourly. Is that a problem? Do we ever do that? Does it make sense?
Mike Danford
Yeah, so repricers will, I mean, they can do something pretty significant, like your resellers. So whenever the buy box rotates, it’s a little easier for you to… What I mean by rotate is one person’s offer for this product, they’ve liquidated, they don’t have any more inventory. So the next person in line becomes in the buy box. That’s a little more forgiving when you have multiple sellers on the listing. But when it’s in your own product, in your own listing, yes, you can do that. We do have intraday pricing, so time of day pricing. I mean, obviously there’s a sweet spot as a heat map for sales. You can do that, but you have to be careful again, of the delta. One, the delta you make and the number of changes you make in a day. If there’s too much volatility, Amazon’s going to pull you because they want consistent pricing. Because they’ll put out a promotion, a circular or something of that nature with the price, and they need to know that that price is going to stick for a certain amount of time. and there’s all kinds of factors that come into it. But yeah, hourly, you would have to have an extremely high sell through product, in my mind, a high units in order for an hourly price to make sense. If you’re selling 10, 15, 20 units a day, hourly is not going to make that big of a difference. But if you’re selling a hundred units an hour, I think it does make a difference. To answer your question differently, we don’t do hourly. We don’t, we do have hourly data that will come through, but it’s behind. It’s hindsight after the fact. We do intraday updates if shipment issues or sell through and we have a limit of what we want to sell for the day. We do make those updates. But you have to be careful because when you change your price, it does impact your conversion, et cetera. And if you do it too much, then you lose your ranking and you can kind of lose that velocity. But for big tents, what we call tent poll days, prime days, two or three events, or even with Halloween, we’ll make those changes intraday if we need to.
Mark Stiving
Okay. By the way, I’m enjoying asking you these hard questions. Can I do price segmentation? I want to sell my snowblowers in Minnesota at a higher price than I sell them in Texas.
Mike Danford
Not on the platform. You’re not able to lock like that? Not most of them. At least what we deal with, you can’t do geolocation pricing, you can do geolocation shipping. I mean, you can kind of get into the shipping if you’re not selling it through the actual platforms, fulfillment centers. If you’re selling it on your own, you can do that. You can have different plans in place, but no not to my knowledge. You can’t do anything with geolocation pricing, not in the marketplace.
Mark Stiving
And that’s the limitation of the marketplace. They just said, look, you can’t do this.
Mike Danford
Yeah. Because when I’m traveling, I’m on the East coast and I’m shopping on my phone and I want to ship it to the West coast. It’s totally different from my location versus where I want to ship it to. There’s so many variables that are in play and I think that just, man, I would just think about the complexities of that. And right now I think the way that Amazon combats the shipping times is, ‘Hey, we’ve shipped, we’ve got multi-channel distribution or multi-location so we can get it to you in time.’ And that’s what people are concerned with. I will tell you that personally as a shopper in my experience, I’ll look for offers that are available same day versus if I can wait for it a week, I’ll be a little more forgiving on the price. Yes, it’s lower price and it’s going to ship directly from their warehouse. So I’ll wait a couple days or a week or whatever, but if I need it more instantly, then I might be willing to pay a little more, which is what I’m assuming you’re kind of alluding to here.
Mark Stiving
I was just seeing what I could do. I love doing price segmentation if I can. So talk to me. Let’s pretend that I sell a product and I only sell it on Amazon and at Best Buy.
Mike Danford
Okay.
Mark Stiving
How do I price it? Do I price it higher at Best Buy? Do I price it the same price at both places? And when I say Best Buy, I mean the store not bestbuy.com.
Mike Danford
Oh, okay. The store is a little different. they’re going to have different thresholds and you’re not going to be able to be as dynamic if you will. And Amazon from my understanding, is not going to know the price that you’re selling it in Best Buy. If the product’s available in bestbuy.com, then yes. Then you’re going to have to be, you’re going to have to be pretty close to the same price. Don’t know the exact cadence that Amazon scrapes. And sometimes it’s way more sensitive to a price change on other platforms than others. We’ve had products that were way cheaper on other marketplaces and they don’t even notice. And then we’ll have it, it changes in the next, and then there’s a one to two, and sometimes even a three day latency of the price that they’ve scraped. Because they only do it twice a week. So you have to hold that price because it’s been updated on Chewy, but Amazon doesn’t realize it’s been updated. So, to keep yourself from having to play that game again, losing the buy box is very painful, especially if it’s a high volume product. You can’t run advertising if you’re not in the buy box. So your goal is to keep the buy box so you can at least run advertising so you keep some steady traffic to the listing. So your best thing is to master price if you can.
Mark Stiving
Nice. Yeah Mike, we are running out of time, but I’m going to ask you the final question that I always ask. What’s one piece of pricing advice you would give our listeners that you think could have a big impact on their business?
Mike Danford
The one that we have the aha moment we have with our brands is one, if you haven’t tested pricing, do it today. Don’t wait. There’s no better time than right now. And the second is, if you tested it a year ago and you haven’t touched it, or you did it six months ago, do it again. The market is constantly changing. Be willing to make those small changes. And if you are having high competition, thin margins on advertising and advertising is just squeezing more of your profits to go to your pricing. Especially if you’re not already doing that, there are usually 2 to 3% more margin in contribution dollars available for you if you look at your pricing, especially in a larger catalog.
Mark Stiving
Nice. And when you have such tight margins, small pricing changes make a huge impact.
Mike Danford
Yes, absolutely.
Mark Stiving
Nice. Mike, thank you very much for your time today. If anybody wants to contact you, how can they do that?
Mike Danford
Sure. Adverio, so, A-D-V-E-R-I-O.io, or you can find us on LinkedIn, Mike Danford.
Mark Stiving
Alright, thank you Mike. And to our listeners, thank you for your time. If you enjoyed this, would you please leave us a rating and a review? And if you have any questions or comments about the podcast or pricing, feel free to email me, [email protected]. Now, go make an impact!
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