Amazon Changes Their Prices 2.5 Million Times a Day
Profitero, a price intelligence firm that provides online competitor pricing data, posted its analysis on the Profitero blog. The company’s findings on Amazon.com quantify a practice that Amazon.com has practiced for years. Last year it was discussed that Amazon.com uses “robo-pricing” high-speed trading tools to adjust prices across its vast assortment of products. It was found that prices on Amazon.com can change as often as every 15 minutes.
Prices that rise and fall faster than most stocks being traded on Wall Street can be a great deal to keep up with for retail partners and industry stakeholders. This is where services such as price intelligence from Profitero and competitor 360pi come in. As the holiday season was just barely getting moving, retail price and product intelligence firm 360pi offered a view into Amazon’s holiday pricing.
Rapid price adjustments are necessary for Amazon, and necessary for competitors to be aware of.
“Amazon’s business relies on its ability to offer as much as possible, as cheaply as possible, so constant price discounting shouldn’t come as a surprise. Amazon continuously monitors and undercuts its competitors’ prices. But the frequency at which the company is now changing its prices is incredible,” states Quarts.com
Now that the holiday season is in full swing, Profitero is sharing those details on just how often Amazon.com changes its prices, and what that looks like. According to analysis from Profitero, Amazon.com has increased its number of daily price changes ten-fold over the last 12 months. In early December 2012, Amazon.com implemented 269,113 price changes. While rate for price activity increases during the holiday season, it continues all year. Price changes may happen with less frequency.
“It’s staggering that Amazon.com is making millions of price changes on a daily basis. The sheer scale of these price changes demonstrates why brick-and-mortar retailers need to be using an advanced online price intelligence solution if they want to compete with Amazon,” said Volodymyr Pigrukh, CEO and co-founder of Profitero, on the blog post.
“Profitero predicts that the number of price changes is only going to increase as the retail landscape becomes more competitive, and so it’s impossible for any retailer to monitor this number of price changes manually.”
Competitors both online and at brick-and-mortar stores benefit from insight into Amazon.com’s practices.
“Today’s hyper-competitive, omnichannel landscape compels retailers to incorporate all sources of competitive pricing data in their pricing and competitive positioning strategies,” said Rip Greenfield, SVP Global Alliances & Business Development at Revionics, on the Profitero blog. “Incorporating Profitero’s competitive data with our price management and optimisation solution ensures that retailers can systematically operationalize the use of this critical data to take actions that enhance both price image and profitability.”