Author: Moira McCormick

Bryan Eisenberg recently published the book “Be Like Amazon: Even a Lemonade Stand Can Do It” (co-authored by Jeffrey Eisenberg and Roy H. Williams) outlining some of the eCommerce giant’s most successful strategies. In this article, the author explores some of Amazon’s pricing strategies outlined in the book, and provides tips for how eCommerce pricers can implement these strategies in their own pricing tests. Moira McCormick is a Researcher & Pricing Specialist at BlackCurve. She can be reached at

The Pricing Advisor, March 2019

According to, global eCommerce retail sales are expected to top $27 trillion in 2020 and the biggest eCommerce retailer by a mile is Amazon. Bryan Eisenberg recently published the book “Be Like Amazon: Even a Lemonade Stand Can Do It” (co-authored by Jeffrey Eisenberg and Roy H. Williams). Perhaps you could experiment with some of Amazon’s most successful strategies?


Amazon is always computing the numbers, and it uses data in every aspect of their business including pricing.

The best eCommerce companies focus on building a pricing infrastructure that helps them analyze potential pricing strategies and gauge their performance over time.

Developing a rigorous, data-based pricing strategy has a quantifiable ROI. McKinsey suggests that strategically increasing a price by 2-4% could increase profits by 15-25%

Whatever your business, knowing how best to optimize prices is intrinsically linked to a deep understanding of your product and its ever-changing value.


A price-lining strategy introduces different levels of pricing for products of different quality. A three-tiered pricing model is often the most effective, the product priced in the middle aimed at the average consumer, lowest priced items aimed at the most price sensitive and higher priced items aimed at the least price sensitive.

You could try bundling to create a competitive advantage and if the bundle includes products or features that are unique to your company your competitors will be unable to offer an identical bundle or compete on price.

A cumulative discount is an effective strategy for delivering additional value to your most loyal customers, whilst increasing revenue. You could offer a 5% discount, for example, after a customer has bought 8 items in a month. After purchasing 15 items your customer may get a 10% discount, rising to a 15% discount for 20+ items. If you have surplus products, you could profitably offer 2 for 1 or “Buy one, get 50% off”.

By offering a loss-leader you can probably safely assume that most of your customers will make additional purchases, increasing their total shopping cart value.


Most eCommerce stores have daily promotions or discounts of one kind or another for specific products; the most usual way to display the discount is to reveal the original price crossed through and followed by the new lower price.

Hopefully this price visualization has the desired effect and your customer feels they are getting a bargain. However, what you really want to indicate is that this offer will not last forever, so they should get a move-on with their purchase. If you add something like “Today’s special offer”, “Limited time offer”, “This week’s deal”, etc. the customer will know the price is a short-term offer and will be persuaded to buy now rather than delay.

Incentives often motivate your customers to buy. Even if you can’t sustain low prices in the long term, limited time pricing can reach out to those potential customers who are hesitating. For example, “Purchase in the next hour and receive 20% off!”


Amazon is constantly using algorithms to try to find the “right” price. You could experiment with the following:

  • Use discounts and offers to measure the impact of lower prices
  • Show different prices to different users and measure relative performances
  • Adjust your prices daily, weekly or monthly and monitor the impact on sales
  • Create different versions of your products at different prices to reveal the best performer
  • Use email marketing to sell at different prices and measure conversion rates


Research by American Express found that 60% of customers are willing to pay more for a better experience.

Companies which focus on improving their customers’ experience should realize a positive impact on customer loyalty and retention, plus increased revenues. According to Eisenberg, “Amazon will do everything possible to have people talking about what an amazing experience it was to shop or return items through their store.”

Your company should focus not only on winning new customers but, vitally, retaining existing customers. A Bloomberg Businessweek survey found that “delivering a great customer experience” has become a top strategic objective. Understand your customers’ needs and be able to empathize with their circumstances. Experiment with creating customer personas to aid your customer support team.

According to a Harvard Business Review study entitled “The New Science of Customer Emotions,” emotionally engaged customers are:

  • At least three times more likely to recommend your product or service
  • Three times more likely to re-purchase
  • Less likely to shop around
  • Much less price sensitive


“Amazon is not trying to force customers to fit the way they want to sell to them,” Bryan Eisenberg says.

The whole customer experience should be easy, enjoyable, personal and convenient. You do not have to stock the widest selection of products but they need to be the ones your customers want and, perhaps most importantly, at the fairest prices. These “in demand” products are the ones that should be promoted.

The Professional Pricing Society is the leading worldwide pricing idea marketplace where new and seasoned business professionals from all industries come together for learning, training, and networking while gaining actionable insights, new and refined skillsets, and earning pricing credentials.

Elevate your value by joining our global pricing membership and starting your pricing certification.

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