Emanuel Ruiz breaks down when to raise or lower Amazon prices. Cutting prices can double conversion rates and slash TACoS from 25-30% down to 15-20%, but the math changes for high-ticket items when competitors undercut you. The real answer: let your data decide.
I drastically dropped the price of my products and I actually started making more money. You see, this is the problem with very broad advice when it comes to Amazon, because essentially it's wrong advice. You need to look at the data and see exactly what the next move is. So whenever I do talk to a bunch of like current Amazon sellers, sometimes their conversion rate is so good that they're underpriced their actual products. So even if they would raise their products, now they have more margin, more room to actually run ads. And if conversion rate doesn't slip up, That's the only thing they needed to go ahead and do. But there's also a flip side to that. My TACoS for one of the high-ticket items that I currently have is very, very high. We're talking about 25-30% TACoS right now. Why? Competitors that come into the actual space, they undercut pricing, and obviously our conversion rate is suffering. So instead of going ahead and raising prices in that situation, I slashed prices. And some people might say they don't have enough margin to go ahead and do this. Well, because I slashed prices, conversion rate doubled. So that means now my TACOS is actually going from 25 to 30% to now going to around 15 to 20%. So I saved that margin in the middle. So even if I drop prices by 10%, I'm actually going ahead and making way more money. So again, this is all data-driven decisions.
