What Pricing Strategy Does Amazon Use?

Amazon Online Shopping

A leading e-commerce website Amazon is everyone’s favorite to shop things online. It has gained quite some popularity for amazing prices. Have you ever wondered what pricing strategy Amazon has employed that makes it better than others?


You will find more sellers but fewer buyers in the market. The prices of products have a significant influence on shoppers. The sellers aim to attract customers by providing good quality or service at a reasonable price.

You will always find amazing prices on Amazon because it uses some great pricing strategies with the help of computed pricing algorithms. Let’s take a look at some of its pricing strategies, such as:

  • Automatic Dynamic Pricing
  • Manual Repricing
  • Algorithmic Repricing
  • Amazon Buy Box

The race to win a buyer is the focus of every seller on Amazon. This article will guide you on how to apply Amazon pricing strategies to grow your sales. Some unique strategies like Dynamic Pricing and Buy Box sales can help you achieve your sales benchmark.

Amazon’s Pricing Strategies

Pricing Strategies

Shopping has evolved over the years. People have moved towards online shopping, where they can easily scroll through the market at their fingertips. The biggest online marketplace is Amazon.

Thanks to its pricing strategies, you will always find the best prices for anything you buy there. The system is designed in such a way that it can provide shoppers with the best possible price for the products of their interest.

Price is the most crucial factor in terms of shopping, which can have a significant influence on sales. We’ll take a look at Amazon’s pricing strategies in detail.

Dynamic Pricing

Dynamic Pricing

Imagine a scenario where you are looking to buy an item, and the same item is available in two stores but at different prices. Which one would you buy? Of course, the cheaper option makes more sense; paying more money for the same thing sounds absurd.

You can find numerous options and prices for the same product on Amazon. You have to work smart and stay in the competition as a seller. The item with the best price on the market will have the most sales.

This is where the dynamic pricing strategy comes to the rescue. In this strategy, the prices will not always remain the same but will change according to the market situation. This strategy will consider factors like competitors’ prices, product demand, and the latest market trends.


Due to a large number of products and buyers, the prices on Amazon change throughout the day depending on the market situation.

You can set upper and lower product price limits based on your profit margin. The prices will be adjusted within this threshold to stay in the competition for the best product price and attract more customers.

Automate Pricing


Amazon has an integrated tool for this task on their platform, where you can enter pre-configured rules to adjust your prices. The rules include maximum and minimum prices for the same products on the market.

Amazon’s automated pricing option will analyze the market situation and help you adjust the price of your project to stay competitive. The price will not go under the lower limit set by the seller. It will only change within its threshold.

Manual Repricing

Manual Repricing

If you believe you can analyze the market, stay up to date and monitor it closely. When you get an idea about the market’s situation and the product’s demand, you can move forward to adjust the price of your product accordingly.

Manual repricing on Amazon is challenging, as the marketplace is huge, and the prices will fluctuate with greater frequency. You must stay in the game to avoid being left behind in the race for more sales.

Algorithmic Repricing


The use of automatic repricing is still valid, but the sellers are also moving towards AI-based algorithmic repricing tools.

The algorithms use machine learning technologies to analyze the market better and adjust the prices accordingly. Some repricing tools have the functionality to push your product to rank higher and reach the Buy Box. We will discuss Amazon’s “Buy Box” in detail later in this article.

Algorithmic repricing allows you to set the desired sale price for your product. However, it will not change your sale price unless there is a change in the market. As soon as some shift in the market is detected, the algorithm will work its way to adjust the prices for a competitive benchmark.

It is an effective strategy since it allows sellers to keep their prices competitive without changing the prices of their products manually every single day.

Amazon Buy Box

Add To Cart

If you’ve ever shopped for a product on Amazon, you’ve likely noticed Buy Box on the product page. This is where Amazon tries to get your attention and make it easy to buy its products.

It’s an advanced version of the “Add to Cart” or “Buy Now” section on e-commerce websites. If the buyer has not selected a specific store to buy from and adds the product to the cart, the product ranked in the Buy Box will be sold to the customer.

This indicates that Buy Box has a significant impact on sales of products on Amazon. Every seller should aim to rank their products on Buy Box for better sales. The highest-ranked seller with a competitive price will make it there.

Amazon has been working hard to ensure it is the only one to offer its customers access to this coveted Buy Box. And to do so, it has put a lot of effort into building the customer database and getting better at understanding what products people are looking for.

This means that they can provide an experience that is tailored specifically to each user. They also know how important trust is in the e-commerce world, so they take a very serious approach to customer service.

Final Thoughts

It’s crucial for a seller to understand the latest pricing strategies being applied on Amazon to have good sales. You don’t necessarily need to stick to only one approach. You can try out multiple methods to decide the best-suited strategy.

Dynamic pricing is the most commonly used strategy among Amazon sellers, which can be used to stay in competition with other sellers. You should always aim for the Buy Box. That’s where you can make the most sales.

Frequently Asked Questions

How Frequently Should the Prices Be Adjusted?

There is no specific period or frequency to adjust the price. It depends on the market situation, your competitors, and the number of similar products available.

The strategy works proportionally to the demand and number of products. The greater the number of products, the more frequent price adjustment would be required.

How Effective Is the Amazon Buy Box?

The Buy Box is very effective in increasing sales. It’s the place where you can get maximum sales for your product. If your item ranks in the Buy Box, the system will display your product to the buyer to add it to the cart.

Leave a Comment

Your email address will not be published. Required fields are marked *