Amazon FBA Pricing, Coupon & Marketing Strategy
with Paulina Masson from Shopkeeper
LAST UPDATED ON MARCH 8, 2019
Paulina Masson reveals easy-to-do Amazon FBA marketing strategies to increase traffic and conversions.

We talk pricing psychology, how to use coupons to lift traffic, and more.
Key Takeaways
1 Adding a coupon (public, indicated by the $ Off or % Off orange tag) lifted Paulina's Amazon clicks and traffic by 15%.

2 Using .99 in pricing still works better than .97, .00, and other variations.

3 Prices ending in round numbers (e.g. $30.00) say luxury. Prices using the discounted decimals (e.g. $29.99) say deal.

4 When using "$ Off" coupons, make the total price of the product divisible by the discounted number of dollars (e.g. $7 off from $21, not $5 off from $21).
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Amazon FBA Pricing, Coupon & Marketing Strategy  with Paulina Masson from Shopkeeper
Transcription
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Pat: Hey everybody, how's it going? This is Pat from AsteroidX and I am here with Paulina from shopkeeper.com. Um, yeah, thank you so much for joining us. This is going to be a really interesting one.

Paulina: Hi, happy to be here. Hey, everyone.

Pat: Um, yes. So I guess, um, could you tell people a little bit about, uh, what your experience has been in the space, what you've been up to at Shopkeeper and, and anything else that, uh, like if we were at a dinner party or something and they all, Pauline, nice to meet you. Um, and you explained a little bit about what you do.

Paulina: Yeah. So I understand you want some informal introduction. Informally, I am an Amazon seller who decided to create an app for myself at first and now it's grown to be a much bigger than me. Uh, it's simply an accounting software for Amazon sellers. So if you need the business analytics tool and an accounting software for your Amazon business Shopkeeper is the way to go. So that's what I do 90% of the time. I'm a founder of Shopkeeper and the rest of my time goes into selling on Amazon. I, I do have other people helping me a lot with that these days, but I did start two years ago and they have a lot of first hands on experience and I still do run all types of experimental campaigns just to see what still works and what doesn't work and especially on things like PPC or different pricing strategies. So I liked the experiment and experience, especially try out new features that seller central puts out. So just to see how they affect my rankings, conversions, and so on, have a lot of experience with that if you want to know something about it.

Pat: Okay. Okay. Yeah. So guys, today you're going to hear from an experienced Amazon seller who is actively in the field, um, testing out new tactics, strategies and finding out what works and what doesn't because presumably some of that stuff doesn't work. So if we can test it for you before you make that same mistake, uh, and presumably some of it does work. So if we have great results to bring back to you here, uh, we're going to do it. So I think we were initially going into this, I think we're going to chat a little bit about pricing strategies and coupons. Probably reversed order. Coupons are pretty, uh, like when you say coupons, Paulina, we were talking about coupons. This is like, uh, the, the public tags that you can use to include a discounts in organic search results?

Paulina: Yes, exactly. So the middle orange tags that you see on Amazon search results, that sand discount is there. Yeah. So I know a lot about coupons and I am quite surprised that lots of many sellers actually use them. So yeah, I'm surprised if you, once I, I could go much deeper into it and tell you how, how good they can increase your conversions and actually help you, um, to help your rankings. And especially for those listings that are not doing so well, helping the facilities to enable the coupons on them. Okay. So, yeah,

Pat: and anyone can do this, right? It's not, you don't need to be brand registered or any, any special certification. You can just put up coupons whenever you like.

Paulina: Yeah. It's available just to anyone. Yes. Okay. Yes.

Pat: Okay. So basically if you're an Amazon seller and you're not doing this, you're probably leaving some money on the table by not grabbing shopper's attention with coupons.

Paulina: Yeah. So, uh, I would like to show you actually how it looks like. So I have a screenshot of the coupons. Yeah. Is it okay if I do that? Let's go. Okay. Let's see. So on my screen you see an example of a specific niche, right? So for example, let's start talking about a particular story. In this case, as seller is selling a knife sharpener and look at the knife sharpener niche home in a different knife. Sharpeners are there and it's very, very competitive. Look, this guy has 493, uh, rate or the views, right? This one over 2,700 reviews. This one like it's crazy. You know, like to be a new seller in this niche is really, really hard. So what can you do about it? Look now, if you are just skimming through all of these options, look at this middle one. There's a coupon flag. You'll see the little orange flag here. Save 20% immediately. Your eyes are drawn to it. Wouldn't you say pat?

Pat: It's this one. That's the one thing that the other listings do not have.

Paulina: Exactly. There's just some somehow just you don't even realize, but it does attract your attention. And now let's say I'm a buyer, right? So I am skimming, skimming, skimming, and I sort of go down to these four and now what happens? First thing that any wire is checking after the images is the price, right? So, well, I will look at the prices, but I see that the one on the right doesn't have any reviews at all. So immediately I discarded in my mind as unqualified one. There was no social proof. Writes a plus. It's a sponsored. So I automatically didn't say, just take it outside on my thinking. And that happens like in milliseconds, you know? And the next thing I'm scanning, I look at the pictures as quickly. They all pretty much the same thing. Then I look at the title a little bit, right?

Paulina: So I looked at the prices. Prices are similar but different. But I will just to make sure to look at the, sort of skim the titles very quickly. This one knife, sharper nervous when chef knives or this one kitchen, they all are full of keywords and quite meaningless to me. But the key here is to put in in the beginning, in the first three or four something very, very personal to the customer. Because when I'm shopping, I'm only thinking about myself. I don't think about how good your knife sharpener is, how amazing, how yours, yours, yours. I only think mine, mine, whatever is about me. And the last case is middle one has this word chef knife sharpener, right? So I'm thinking, hmm, I'm a chef. You know, it has a little bit of personal touch to it and that gives a little bit better thing.

Paulina: Uh, before I click into it, I did click already, but I went back. You see those three prices? Look, this one is $17.99 this one 49 to nine and that one $12.99. So no one, I'm thinking which one to click? Probably the $12.99, I won't even consider because very quickly I discarded as probably lowest quality one. You know, most often the lowest priced one is associated immediately with the lowest quality one. So discard that one and that one's a little overpriced. So I'll just click on the middle one plus this coupon flag. It just keeps attracting my attention, not actually because of the savings budget because of the orange in it. So just keeps, um, somewhat of psychologically just attracting my attention. So I will click into it. Now. Um, what'd you think the first thing is that the people look inside the listing? Like they come to the new thing and what's the first thing they would go and look at? Why do you think?

Pat: I was looking at the Amazon's Choice badge, but the photo is probably it. Main photo.

Paulina: Exactly. The choice badges is sort of, because I was looking at that coupon, right. It's, it hits your eye right away. I think you, because we're talking about the coupons. You got that on your mind.

Paulina: But in reality, yes, you're right. It's, it's the images. So that's the first thing that people look at. And again, they're thinking only about themselves. Look the way this works, some looking, okay, nice image. Click, oh, that's me sharpening holding this knife sharpener. I'm sharpening my life. Cool. I don't really care. You know about your things that it's something else. I just care about me that I will be holding it and I will be doing that. So I imagine myself next picture again. So I remember this morning how this tomato bell pepper was so hard to cut, right? Because my current knives, knives are show sold dull. So the knife sharpener here, I immediately imagined myself cutting it or it's going to be so easy to do that next morning. And here I think, yeah, I have stainless steel kitchen is gonna match very nicely. So I don't really think about anything else about me, me, me, me in every image.

Paulina: So that personalization is very important. Now you will say: 'Paulina, but you started talking about coupons and now you're suddenly go into this personalizations and images. Why do you do that?' Well because coupons actually have that little effect of personalization as well. So they help you to personalize, have that personalization effect when you add it. Wow. How does this happen? So after I'm done looking at the images, the next thing I'm going to look at is the price in area. And I see this coupon here. Now let's zoom in on that. Now you see price and there's this checkbox, it says save an extra 20% when you apply the school barn. So none of the buyer's thinking, Huh, what? So do I just have to click on it and I will have 20% like I don't need to buy more than one, I don't need to qualify somehow else sort of chips.

Paulina: I click on it and it says applied and I am like, wow, I feel lucky suddenly, you know, I may leave that listing because maybe it was just lucky chance only this one time I got this coupon, you know? So I feel like it to get it for no efforts for no reason. Right? So that's where the personalization comes in. It's actually, you personally made the buyer feeling happy or lucky, you know, so it's like cool and there is a special setting. I will show you later in seller central how to do that. Like you will not going to restrict him by at least two to get this discount or whatever. Just get the discount by checking on the checkbox, you know? And that's what makes them so happy and I'm Oh okay. So let me just click add to cart to see how much actually that coupon is.

Paulina: So I see here $3 were discount was applied and in the end I will be paying $11.99 but now see what happened. Remember the beginning, there was this guy on the right, which I discarded because he was the cheapest 12 nine right? I thought I didn't even click on him because I thought this is the lowest quality one. Now you are actually paying 1199 on this one. So cheaper than the cheapest guy. So you didn't get the click and you are the best deal for the buyer. So after, after this point, he's already done so much investment of time into your listing that he's very, very likely to check out at this point. So just to show you in a seller central what I was talking about, so in a.com you will just go advertising and coupons and that's all you can set it to set them up.
Creating a money off coupon in Amazon Seller Central
Paulina: So it's very easy. You will need to give a discount, which is between five and 80% and you could either choose money off a percentage off. So I recommend just using money off because percentage off is better suitable for big items like refrigerators or uh, like big pieces. Then the discount seems more, I'm a big important, but if it's less than a hundred dollar item, I've would recommend always going with money off. So, um, okay, so you just put the amount that you're giving and I limit redemption to one per customer. I don't know. I just do that. And he has this budget that I put in. I put in a 1 million dollar budget for this coupon. Now you will say, why Paulina, you're doing 1 million? I don't have $1 million. What if you know there is 1 million claims? Well, the reason I put it this, because I have a lot of previous experience of Internet, online marketing, different traffic paid traffic that I was running pop unders and ads and salon and many, many other digital platforms.
Paulina: The bigger the budget you put, the more the platform is trying to spend your budget. That is to make more money for them. Right? So I am hoping that Amazon has something similar. The bigger your budget, the more the algorithm will try to maximize it. So I didn't test that because you can't test it. But I'm saying that is my reason why I put such a big number because it's never going to be used anyways. It's just I'm trying to boost it up to help maximize it. And by the way, Emily is redemption for each coupon is going to cost you 60 cents now you will see all wait bullying us so it's not free high. Don't just enable who coupon and they get the, I get the benefits. I will have to pay for each of them. So well in fact, what, when I tested, I realized that only one out of three people actually click the check check mark where they have to apply the coupon.
Paulina: So I am getting three times as much traffic, right. And only one, only 30% of them actually apply the coupon. So, um, it turns out then there's not 60 cents for each click. Right? It's only 20% for each a coupon, one third, the time attracting, you get so many times as much traffic using a coupon. Um, no, that's not what I'm saying. I'm saying the price spreads out into three parts because all click, not for many people who actually click that checkbox. Remember I showed you the checkbox they have to click. Right? Right. Well I think they're just like maybe non technical people, you know or or I dunno, older audience or some of these just don't notice or forget it. They just click add to cart and think that the coupon was automatically applied. But actually they have to click that check box in order for coupon to be applied. So only one out of three people in my experiments does the click. That's what I'm saying. It's not actually 60 cents that you pay. You're paying 20 cents for each click that comes in for his buyer. Got It. Yeah. Well, personally,
Pat: have you, have you seen um, uh, click through lift, uh, with the same listing non coupon versus coupon?
Paulina: Oh yes. That is a very good question. So that was almost my next line. So that's the slot on that predicting the next task. We did not prepare this whole life. Okay. Because that's low and that's how it ends. It's boys, you know the business reports, you can check your conversion rates for his listing. Right? So for those who don't know, if you go into business reports and look at your sessions, that's the total number of visitors that each of your ace and Scott. All right. And uh, that's the unit session percentage. That means conversion rate in percent. How many people from all of those visitors converted into buyers in my category and I don't hide it. I sell apparel things. That's the approximate a conversion rate that I got. So it's between 10 and 14% normally. So I noticed that when I apply the coupon, it increases by one or 2% the uh, the conversion rate, but conversion rate, I don't know why it magical increases.
Screenshot of traffic increase from using a coupon pricing strategy
Paulina: I also am getting many more sessions, many more, let's say 15% more sessions automatically just because there is a coupon, I don't know exact percentage, but it's not like double or triple, right? The day increases just slight. But what happens on Amazon, as soon as Amazon sees that your conversion rates are increasing and more clicks, I happen, so CTR and conversion rate of both increasing automatically your ranking is getting better. So it was like a skating effect. You put the coupon, you get more clicks than automatically your rank is better. And then you get, because of Ab more clicks and then there's this cascading up, right? It's really good effects of slick and mingle launch that you can have for two or three weeks. A little boost by just adding a coupon there. Okay. Is there, is there any point where you take the coupon off afterwards? 
Paulina: It doesn't seem to be a very good question. You see on the screen there's this, uh, between one and 90 days period only that you can set. So maximum coupon existing life will be only in 90 days. You'll have to ask you a VA or yourself to go after 90 days and click a button, restart this campaign. So you will not have to create again, there's just refresh the same company. So yeah. Um, you know, one other thing I really wanted to bring up is the actual little bit of psychology in setting the prices and what is better. You know, remember there was a choice you could choose a percentage of, or you could choose dollar amount of. So just like I mentioned, if it's less than a hundred dollars, I recommend using dollar amount. Um, in addition, you should try to make it very easily comprehendable. So it should be very, very quick for the buyer to understand the, the amount of the discount that you're giving. So for example, 21, seven to nine, and you're giving me 15%. Okay, 10% is two door something. Ah, I want to move on. Right? It just hurts my brain, right? So I want to move on. So look at this. How easy it is. $3 from 21 and it's fantastic. That's going to be much easier to convert. Now, path, I have a question for you. Look left and right. So both of them are the same except the coupon amount is different. There's $4 off, there's $3 off. So which one you think converse better?
Pat: Um, $4. Why? It's more than three.
Paulina: It's more than three, right? That's like a natural answer. That's where I was thinking also because you only look at how much you save and so on. But you see on top, I have this indicated as complicated and the other one is easy, not why it's complicated. Again, it's about that psychological comprehension of price. Since we were kids, we are taught multiplication table, you know, uh, two times seven, 14 three times seven 21 for 10 cents to to 28. Right? So if you are using a discount that is not the multiple that comes up to that number, it's much harder to understand how much of the parts of that number. I'm getting a discount. For example, I know that three from 21 I'm going to pay $18 and that is basically one seventh of the price. I'm getting a discount just like all this math is so in in us that we don't even think about it. Now here, how much I'm actually paying. Okay, take one off and then 20 months, three the 17 [inaudible] 17 see that little extra millisecond I spent two to a account for how much I'm getting here. So because of that, it's sort of...
Paulina: it's easier when I'm skimming very fast because we all skimming on it or not. No, just skimming, skimming, skimming. One, I'm skimming, skimming, skimming. I just somehow quicker understanding and the quicker I understand it, the more clicks you're gonna have. So increases your CTR for some reason. Of course, if you're a save, $10 is going to be better, but if it's just a slight difference, it's always better to choose. That would be a multiple equally viable
Pat: Okay, good observation.
Paulina: Yeah. There's another thing that I can tell you as well. Uh, you know how, uh, there are even numbers, odd numbers, right? So by the way, even number implies a little bit of a luxury in the item and odd number implies more discount, bigger effect. But in this case, I'm just showing another example here that 4 in this case is better than 3 it's bigger, but it's also divided and from at 22 easier,
Pat: Clean. Yup.
Paulina: So yeah, there you go. That's the idea about the , uh, things. Let me just mention one other thing. I'm going to try and find. Here's the example. So, see the two different endings. A items are the same. One is $30 one is $29.99. Now you know, everyone is using these 99 99 99 things. Now when they're doing that, we are so used to seeing the 99.99, that automatically our brain thinks that when you see 99.99, it's some sort of deal. It's some sort of discount bargain, a deal. And when there is not an 99 in the end. So if it's not a deal, not a bargain, that means it's more luxury, something more expensive. Right. So when you're looking at these two, the one on the right, the $30 one is assuming that that product is more luxury. It's like it's positioning itself as more luxury just by having one sentence difference here.
Paulina: Why have it round price of $30 is appears to be more expensive, more uh, for one. And this one is sort of trying to position itself as a keeper bargain to prevent something so you can play with that as well in your prices when you are working on them. Uh, so yeah, uh, just wanted to mention about that ending. Uh, I think that's my last point that I'll bring up. Uh, you know, those little endings, how some people are thinking maybe seven is like, cause you know, seven, seven, seven. So his lucky numbers, I'm going to use that. And you know, there's all kinds of psychological experiments, but in reality, all of them, when we are skimming the price, this one we, we read from left to right just very quickly. This 1.9 something, this one 29 [inaudible] nine something, 29 something. So see all of them, I read as 29 something.
Paulina: I don't really as a customer read the full price, I just read the beginning of it and now we'll look at extra profit that you can make if you make 98 or 99 so that's like the last column shows that the most profit in the year you will make if you're using those higher sense. So just in my opinion, just avoid those strange painful for our brains numbers that we are not used to. You can just play on the last digit if you want. Be perceived more as a luxury item used like the eight at the end or nine if you want to compete with other competitors for the price. So that kind of thing. Yeah. So that's pretty much it. I guess. Let me go back to our screen. Yeah,
Pat: that was awesome. That's so much good stuff in such a short amount of time. Yeah, thanks. Okay. Um, right. Yeah, so, so that's basically a, yeah. Run through of coupons as well as pricing psychology. Um,
Paulina: okay.
Pat: Yeah. Okay. Uh, yeah, really interesting. So I guess, um, I, I did have a, did have a clarifying question. I get, I guess when you, when you would, there were items that were more expensive, say over $100, you a recommended a percentage off. Um, is that because the, the dollar off just looks too crazy if it's like $200 off or, or, or like why go high ticket in percentage?
Paulina: Uh, just because uh, people, when they put percentages, the hope is that it will appear as a bigger discount. Right. So when you were saying 10% instead of $3 off, you are hoping that you are giving impression as if the amount is bigger, but you are making the person to calculate, you know, he, he has to actually think in his mind the next one millisecond how much you're giving him and that stops your, kills your conversion rate. That's why I recommend using a number of itself.
Pat: Right, right, right. Yeah. The, the number one principle, uh, among all of these things appears to be just to reduce friction and increase a simplicity for the customer. If it's something easier to understand, it just flows better.
Paulina: Exactly. As simple as you can so that the conversion flows easier and you will be surprised how much it increases on helps. Actually it applies to any business that you do. You know, if you are promoting anything else online or on your own website, on Shopify sites for your own products. Right. We are putting prices there so it's the same strategy supplier as well. So the simpler your pricing page is, the better for your user conversion are.
Pat: Okay. Okay. Yeah, very good. Um, yeah, well, uh, yeah, speaking of you know, other stuff online, if you want to let people know where they could get ahold of you or see you also have a very cool, um, list of, uh, I guess Amazon seller resources, apps, services, that sort of thing. Um, yeah, thanks for, thanks for listing AsteroidX on there. I appreciate it. But there are other good ones as well. Um, so yeah, maybe just start, tell people where they can get ahold of you and look at your current work.
Paulina: Yeah, it's really popular page on our site. So if you go to shopkeeper.com you don't have to memorize the whole year. I'll just go shopkeeper.com. Scroll to the bottom, you'll find the link there, which says big list of tools for Amazon sellers. And I personally review each tool. So actually I connect my account, I take the time to test it and so on. So I really like doing that as an experiment. Like I said that I love doing all kinds of experiments and they give a mini review like a few sentences or what I personally thought and how it applied to me as a private label seller. Some things you might disagree with, but because of that informal way that I describe it, that's why the list is so popular because it's so easy to, you know, to read it and to have fun and some jokes I make that as well, I don't know.
Pat: And you're reducing friction by not telling people the URL. So yeah, just go to shopkeeper.com, scroll down, find the services. It's a, it's a really good resource. And um, yeah, probably this is a, this is a tremendous sort of interview and really good, um, just just great value. So, um, yeah, thank you so much.
Paulina: You're welcome. Nice to meet you. Thank you, everyone. Come read my blog, as well. I have a lot of interesting articles about freight shipping and like, my personal story is us being an Amazon seller, so I hope you enjoy those.
Pat: Yeah, yeah, guys, I would say one of the best hacks to growing your Amazon business is definitely learning from people who have done it before or are currently doing it. And Paulina's a got a great view of the industry. So yeah, thanks for stopping by and, uh, hopefully we'll do this again sometime. That's really fun.
Paulina: Thanks for having me.
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