Thank you to everyone who joined our Shopify Community AMA on optimizing pricing strategies with Prisync. We discussed competitor price tracking and AI-powered dynamic pricing.
Here are top 5 questions and answers from the session:
Q1. I know every company is different, but what model do you use as a standard for product pricing? Is there a baseline?
While every product is different, most pricing strategies fall into one of three models: cost-based, value-based, or competition-based. Cost-based pricing starts with your production costs and adds a margin on top. Value-based pricing focuses on what the product is worth to the customer, not just production costs.
Competition-based pricing looks at what similar products charge and positions your price accordingly. The key is finding the right balance between your costs, customer willingness to pay, and how you want to position your brand.
Q2. How can I use AI to protect my profit margins from tariffs and supplier cost fluctuations?
If you’re retailing branded goods that you source from your suppliers, the way to maintain a healthy sales volume and profit margin at the same time is to keep a close eye on your COGS (costs of goods sold), competitor prices, using AI tools, setting up dynamic pricing optimization to ensure you stay both profitable and competitive at the same time. Due to tariffs popping up here and there, keeping a close eye on costs is probably the most challenging.
Q3. In ecommerce, given our COGS, which percentage of this should be added to set a profitable price?
Profit percentages depend on quite a few things, the most basic ones being the product category and the competition in that category. As this article from Shopify also highlights, a 50-60% markup is a good starting point.
Q4. We run our brands across multiple marketplaces (Shopify, Amazon, etc.), and we are looking to manage the pricing in a more systematic and agile way. What suggestions would you share?
The best practice we’ve seen so far is to use Shopify as the central hub and then manage the other channel prices from Shopify - instead of, for example, taking Amazon or something else, the central hub, and then trying to sync things up with Shopify.
One very straightforward approach to handling those multi-channel prices/listings is to use one of the many channel management apps within the app store. If those channels also include the resellers of your brands, you may also benefit from Prisync’s Google & Amazon price monitoring capabilities to scan all those channels’ prices and calibrate your prices according to all the different price points out there dynamically to ensure multi-channel pricing consistency.
Q5. How can Prisync’s pricing tool help skin care brands optimize their pricing strategies and increase revenue? (Premium Brands)
Optimizing your pricing strategies is all about knowing your customers, your business, the costs, and the competition. If you want to invest time and effort in increasing your revenue, throwing around discounts and sales will not cut it — especially for a luxury skincare brand where premium prices matter.
After you define your brand’s value proposition and unique selling points, using a pricing tool can allow you to identify the ideal starting price for your products and track your competitors momentarily to see whether there is a stockout situation your competitors’ ends to allow you to promote that specific product — so you can act with precision in the process of increasing revenue.
In addition to optimizing individual product prices, luxury skincare brands can also use product bundling to increase average order value, move complementary products, and justify premium pricing without compromising brand perception and offering direct discounts.
If you weren’t able to join the live AMA, please feel free to look at the question board and stay tuned for our future events!