Amazon seller’s repricing algorithm gone wild

Tweet about this on TwitterShare on FacebookShare on Google+Share on LinkedIn

graph

If you are an ecommerce merchant selling on Amazon, eBay or any of the market places, I’m sure you have considered using an algorithmic repricing software. These software can watch the price of your competitors and automatically adjust the price of your listings. The goal is to increase your sales without giving up on the profit.

This article by Michael Eisen is a must-read for all of you who have considered algorithmic repricing.

On the day we discovered the million dollar prices, the copy offered by bordeebook was 1.270589 times the price of the copy offered by profnath. And now the bordeebook copy was 1.270589 times profnath again. So clearly at least one of the sellers was setting their price algorithmically in response to changes in the other’s price. I continued to watch carefully and the full pattern emerged.