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2023 UPDATE: I recommend all booksellers use NeuroPrice to reprice their books.
It’s a new type of repricer that doesn’t have the FBA blindspots that other repricers have. This will save you money because other repricers can’t see all of the available offers, which can cause repricing errors that sell books for low amounts.
Pricing your books with a thoughtful FBA book pricing strategy is the second most impactful thing you can do to increase your profits ‒ the first being sourcing, of course.
I admit, it’s tough to give advice on this topic because every pricing situation is different. There are an avalanche of factors to consider when pricing a book, and the lack of data on how those factors actually affect your sales makes it even tougher to advocate for any particular pricing strategy.
With that little disclaimer out of the way, I’m going to explain what goes into my FBA book pricing strategy. You can use this information to help you with the thousands of pricing judgment calls you will make as your inventory grows ever larger.
Table of contents
- The importance of leverage
- The importance of average sales rank and drops per month
- FBA vs. Merchant-fulfilled
- Book condition
- Collectible books
- Seasonal books
The importance of leverage
All book offers on Amazon are not created equal. Some have features that make them more attractive to buyers than other offers without those features.
If your offer has a feature that adds value over other offers of that same book, you have leverage over those other offers.
- If your book is fulfilled by Amazon, you have leverage over the merchant-fulfilled (MF) offers in the form of two-day Prime shipping.
- If your book is in Very Good condition, you have leverage over books in Good or Acceptable condition.
- If your book holds the Buy Box, you have leverage over the books that don’t hold the Buy Box.
- If your book is a Collectible copy (first edition/signed), you have leverage over the non-Collectible copies.
The crux of a successful pricing strategy is in identifying which books have leverage and pricing based on that leverage (or lack thereof). Knowing your copy has leverage allows you to make one of two choices: price higher to make more money, or price lower to get the next sale.
The importance of average sales rank and drops per month
The average sales rank is the most important factor to consider when pricing your books.
Why? Simple: It tells you how often the book is selling.
If you have an offer that is superior in every way to another offer, but the book only sells once per year, you’re probably going to want to match that inferior offer. If you don’t, it could take years for the book to sell because the next couple of buyers might only be interested the lowest-priced offer — condition and shipping speed be damned.
The easiest way to determine how often a book sells is by checking its average sales rank on Keepa. An average sales rank of 1,000,000 or less sells about three copies per month.
Note: As of a few months ago, Keepa is charging ~$16.50/month to access sales rank data. Accessing this sales rank data is an unfortunate necessity for FBA booksellers, so I recommend biting the bullet and subscribing.
If you aren’t sure how often a book with a given average sales rank is selling, you can find out by checking the number of sales rank drops on the Keepa graph.
Every sales rank drop indicates a sale. The drops per month metric lets you approximate how many times the book sells in a year. And once you know how often the book is selling, you can decide whether to play it safe and match the lowest offer or price higher to get more out of your offer.
My rule is pretty straightforward: if the book has an average sales rank below 1,000,000, I will raise my price to reflect the book’s leverage. If the average rank is above 1,000,000, I will usually get down in the pits with the lowest offer and aim to snag the next sale.
I will admit, this is a pretty conservative rule. I know many sellers with sales rank thresholds over 1,000,000. I prioritize selling every item in my inventory over maximizing the return from individual items, so I use 1,000,000 as my threshold for raising prices. Feel free to experiment with a higher threshold though.
Types of leverage
FBA vs Merchant-fulfilled
FBA adds leverage to your offer in the form of two-day Prime shipping. Many people will pay a significant premium to get their stuff in two days. Amazon has even started offering one-day shipping when the item is located near enough to the buyer, offering an even bigger incentive to pay more for Prime shipping.
If your sales rank allows for a price rise, pricing your FBA offer higher than the lowest merchant-fulfilled offer is the most direct and consistent way to increase your profits.
Once you’ve decided to raise your price, you need to decide on the amount to raise it by.
If there are other FBA offers — I’ll almost always cozy up with the lowest one — as long as it isn’t priced near the lowest merchant-fulfilled offers. If it is, I’ll usually set my price higher than that lowest FBA offer because I know I can get more out of my offer.
If there aren’t any other FBA offers — I will go 2x, 3x, or a fixed amount above the lowest MF price. The increment I choose depends on how low the MF price is.
If there are no other FBA offers, and the lowest MF price is $6 or less, I will price my offer at $19.99. I do this because paying less than $20 for two-day shipping is pretty reasonable. Many buyers will see the “1” at the beginning of the price, subconsciously note that the price isn’t that high, and buy your FBA offer without a second thought.
If the price is $7 or more, I’ll start to price my FBA offers triple what the MF offer is. If the MF offer is $7, my FBA offer would be $21. This price might seem rather high, but I consistently get sales at this price range.
If you’ve got a particularly valuable item, setting a price three times more than the lowest MF offer becomes a dicier proposition. Many buyers won’t think twice about paying $24 for Prime shipping, even when that same item is available for $8 without Prime shipping. They will think twice about paying $150 when they could get the same item for $50 though. So when the lowest MF offer is at least $30, I will only price my FBA offer at double the MF price.
Acceptable vs. Good/Very Good/Like New
Acceptable books deserve their own category because a book has so be in particularly awful shape to be rated Acceptable. Many buyers avoid these like the plague, and this must taken into account when pricing.
So what’s the strategy with Acceptable books?
If there are no other FBA offers ‒ price using the strategy mentioned in the previous section. Many buyers care about getting their book quickly over everything else, and will buy an Acceptable copy with Prime shipping over a better copy without it.
If there are other FBA offers with conditions of Good or better and the listing has a Buy Box ‒ I suggest undercutting the lowest FBA offer. There are enough buyers who simply buy the Buy Box offer that being in the Buy Box is often enough to get you the sale, even if your book is in pretty bad condition.
If there are other FBA offers with conditions of Good or better and the listing does NOT have a Buy Box ‒ I would undercut the Good+ offers by a decent margin, say 5%. Because there isn’t a Buy Box, buyers will have to come to the offers page and view every offer next to each other. If you have an FBA Acceptable copy that’s only 1 cent lower than an FBA Good copy, the Good copy is almost certainly going to get the sale. That might change if your Acceptable copy is priced at a small discount though.
You should also reinforce this pricing strategy with a repricing template that maintains this distance between your Acceptable offer and the Good+ offers.
Good vs. Very Good
In most cases, I treat Good offers and Very Good offers as exactly the same. The difference in condition between Good offers and Very Good offers is honestly negligible.
- Good offers might have some writing or highlighting.
- Good offers of hardback books might not come with a dust jacket.
- Good offers might have a bit more wear and tear than Very Good offers.
These differences aren’t enough to make most buyers want to pay more for a Very Good offer if a Good offer is available at a lower price. If the buyer is a stickler for condition, they’re probably going to pay more for a Like New or New copy rather than jumping up in price for the marginal improvement that is a Very Good copy. Therefore, I recommend undercutting Very Good offers by a penny if you have a Good offer for sale.
Good/Very Good vs. Like New
Like New copies are in much nicer shape than Good and Very Good copies. If a book is rated as Like New, it only has extremely superficial flaws, if it even has any flaws at all. Many sellers list essentially New copies as Like New, simply because the Like New copy has technically been read before.
Buyers who care about condition will be more likely to pay more for a Like New copy over a Very Good copy instead of paying more for a Very Good copy over a Good copy. If you have a Like New copy, you should price it higher than Good/Very Good offers.
Remember, this is all dependent on having a decent average sales rank. If the book has an average sales rank of more than 1,000,000, you should become wary of playing the higher prices game because the book may never sell.
Used vs. New
New copies of a book are essentially an entirely different product from the Used copies. Buyers who want New copies typically have a lot of disposable income, and are willing to pay way more to get a New copy over a Used copy. I’m talking paying $100 for a New copy of a book that is selling for $6 Used.
If you have a New copy, don’t take the Used prices into consideration. They might as well not exist.
That being said, the previous statement does not apply when you have an extremely long-tail book. If a book is selling one copy per year, it’s smarter to price your New copy at the Used price to secure the next sale. If you found a book selling once per year and actually bought it, it must be worth a substantial amount of money, even at the lowest possible Used price. So selling this New copy at the Used price will still net you a pretty decent profit.
Collectible vs. Non-collectible
Collectible copies of a book can sell for significantly more than their generic counterparts. I advise making sure collectible copies have a history of selling though, as listing something as collectible can decrease its chances of selling in a few ways:
- Collectible offers aren’t eligible for the Buy Box, which is where the majority of sales happen.
- Collectible offers aren’t listed alongside the other used copies in the Offers page. You have to specifically toggle the Collectible checkbox to make them visible.
- Collectible offers are sometimes barely priced above the regular offers. In this case, it would be smarter to list it as a regular used copy. You can mention the copy is collectible in your description to increase your chances of getting the next sale though.
Collectible copies can sell for hundreds more than their non-collectible counterparts, so don’t be afraid to list something as Collectible if it’s a first edition or a signed copy. Just make sure the increased payout is worth the decreased chance of a sale.
Textbooks are a special case. During textbook season they spike in price because all of the college students order their books then.
I strongly advise holding any textbooks you find until textbook season rolls around. In order to do this, you need to make sure your repricer doesn’t reprice your textbooks. You can accomplish this by adding a specific prefix to all of your textbook SKUs and excluding the SKUs with that prefix in your repricer.
I add the prefix TEXT to all of my textbooks when I list them, and I have a rule set in my repricer to exclude any books with TEXT in the SKU from repricing.
Seasonal books include holiday-themed books and books that are often given as Christmas gifts.
You can identify a seasonal book by looking at the Keepa chart. If the book consistently spikes in value and demand at a specific time each year, you can safely assume the book will continue to do so in the future.
If you’re buying seasonal books, make sure to mark them as such with a SKU prefix. Also make sure to exclude that SKU prefix in your repricer.
To summarize, here’s a step-by-step recap of how you should go about pricing your inventory.
- Figure out if your book has leverage the over other offers. Examples of leverage include FBA, better condition, and being collectible.
- If the book does have leverage, check the average sales rank and number of drops to see if you should price the book higher.
- Check the sales history to see if the book is a textbook or a seasonal book. If it is, give it a SKU prefix that tells your repricer to exclude it.
- Set the price and move on to the next book.