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Six Tips for Optimizing Your Pricing Strategy to Boost Sales

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Last Edited 12:04:27 PM

If you’ve been selling on eBay for any amount of time, you probably have a pricing strategy in place. But, if you’ve been using the same strategy since the beginning, it may be time to revisit and optimize your plan.  


Offering deals can help you manage natural peaks and valleys throughout the year, aid in clearing out older inventory to make room for new, and bring you more sales in a shorter period of time. Setting up sales on popular items also invites new buyers to your store to check out the rest of your stock, which can lead to a bump in sales of your other items.


However, there’s an art and science to playing with the dials of pricing to attract buyers looking for a deal. Here, we break down the path to craft a pricing strategy that works for your individual needs.


A pricing strategy starts with knowing your numbers.


As a seller, you know your cost of shipping, your margins, cost of returns and other expenses, which means you know exactly how low you can go while still turning a profit.


You should keep this number in mind for every item you sell because it will influence whether or not you should consider that item for discounted pricing, and how much of a discount you can offer.


Items to consider discounting.


Discounting a rare, one-of-a-kind item that’s in high demand just doesn’t make sense. When thinking about your pricing strategy, think about the items that a brick-and-mortar retailer might use as aisle end-caps or doorbuster deals; these are ideal items to consider.


These items could be:

  • Items that you have a deep inventory to sell
  • Items that you sell on a regular basis, but want to sell more of at a faster rate
  • Items that have a mass appeal and steady demand; e.g. most people know what it is and would consider buying it
  • Items where you have the room to discount prices and still make a profit


The discount offered can range.


You know how much of a discount you can afford to offer, and the good news is that it can be a relatively small percentage off of the competitive market price. As little as 8-10% off of the market price can be seen as a deal, and you can offer these smaller discounts more often while saving larger discounts of 15-20% off for big retail moments like Black Friday, or times when you really want to make a splash and move inventory quickly.


The first step is to figure out what the item’s  average market price or everyday low price is, which you can find in the Growth tab on Seller Hub. If you want to price your item just a little bit below market rate, consider 8-10% off. Consider deeper discounts if you are trying to dramatically increase sales velocity—for example, if you need to clear out aging inventory or make room for new goods in a short period of time. The relationship between price and demand tends not to be linear, so walking down your price can sometimes result in surprising sales growth.


For example, if your item’s everyday price is $24.99:

Offered at 8% off = $22.99

Offered at 12% off = $21.99

Offered at 20% off = $19.99


Work backward from the lowest price you’re comfortable offering to come up with your maximum discount as well as a lesser discount amount that will be enticing to customers without cutting too much into your profit.  


Easing into a new pricing strategy.

Seller_Seller Center_Two women smiling and looking at the computer.jpgNow that you know the maximum discount you can offer and still make a worthwhile profit, you can start small.


First, think about your products in two groups. The first group—the group you won’t be discounting—contains your core products. These are your bread and butter, the items you sell a few (or more) of every day.


Group two, however, might be the items as described above. They’re commonly sold items you have a lot of, and which you can afford to reduce in price without taking a loss. These are the items to consider testing out your new deals strategy.


Next, think about timing. Maybe you have a few days in mind each month or quarter when you know you want to clear our inventory or entice new buyers into the store to meet a sales goal. Or maybe you know your products align with a specific retail moment, such as back to school or summer.


Choose a few days to start offering your discounts, and start small. You can begin by offering a discount on the lower end of the range and increase as needed to sell your items more quickly.


For example, say you have an item that sells at $24.99 every day with a few sales per day. Each quarter, you know you need a bit of help getting to a specific goal, and this item could help move that needle. You could drop the price 8-12% for a few days during special periods like three-day weekends or on certain retail-related holidays.  


Experiment a bit with your discount until you find the sweet spot: the price that brings you more sales without cutting into your margins too much. Save the big guns—the 15% and 20% discounts—for blowout sales events.


What not to do.


Be careful not to underprice (you can avoid this by starting slow, as recommended above). Underpricing can bottom out the price of an item too fast and bring down the item’s overall value. This can be particularly harsh if you’re going to sell this item for a while. You don’t want to sacrifice long-term revenue for short-term gain.


Likewise, be cautious of overpricing. Pricing your discounted item too high will limit your opportunity for sales and could diminish your credibility as a seller.


Always keep in mind the buyer perspective. Whether someone is buying clothes or toys or shopping for a house or a car, they have in mind a price range based on the market. Similarly, for items commonly found online, they’ll shop around and check out the average rate.


Do the same research so you know what range buyers expect and you can experiment with your pricing within that range.


Use the right tools to manage pricing strategy.

Screen Shot 2018-02-15 at 2.27.50 PM.png

As mentioned above, creating your pricing strategy starts with knowing your numbers, and being informed on the average selling price and demand for your items. The Seller Hub Growth tab shows you trends in your sales, seasonal shopping activity, and competitive pricing so you can adjust your offers accordingly.


Once you’ve decided on your pricing strategy, you can manage your deals and discounts in Promotions Manager, which lets you create special offers including sales events and order size discounts.


Of course, the first step in any sale is getting buyers to your listing with structured data, great descriptions and photos, and mobile-optimized listings.


Promoted listings are another tool in this toolbox, and they work in tandem with a great pricing strategy.


Promoting your listings can drive up impressions and bring more traffic to your items and your store. Once you have buyers viewing your promoted item, an attractive offer or discount provides the incentive to purchase one—or several—of your items.


While promoted listings and a pricing strategy can also work independently of one another, they can be even more powerful together, bringing you more buyers and helping close more sales, move more inventory, and improve your bottom line.


Check out eBay for Business talking about pricing strategy during a Facebook live event. 

by vintagecraze50 · Guide

Excellent!!!! article. enjoyed reading it and very very good advice and explained in a way that makes perfect sense for anyone here. Well done.


thanks for your time and energy

by hninjah · Adventurer

Great Article with lots of helpful tips! thanks!

by couch*wow · Adventurer

Thanks, very detailed and helpful!

by ladebugg52 · Adventurer

Thank you for the helpful hints and strategies. I am always looking for ways to tweet my selling potential!


How about some actual examples of the descrived strategies at work. Someone must use them!

Good if you have no experence in sales. The items you are selling and the type of market you are selling into has a lot to do with discounts. If I was selling to distributors that place large orders or has a protective market location that I want them to supply. Then it's very diffrence. But selling one on one in retail market it good.

by debussy2 · Adventurer

This approach really only applies to items where you have multiples. For one-offs, not so much. 

by carolynnq · Guide

I sell one-offs and I think the advice works for those items as well. I run occasional discounts when I want to encourage sales. I select the items individually that I want to include in the sale. I like to select items that have watchers and then run a 3-5 day sale to try to spur some of those watchers to act before the sale ends.

by mstcwrld7 · Trailblazer

     Covered a number of bases but did not mention the obvious:  discount items that are not selling well, to recover capital with which to purchase more popular items. 

by 2826brenda · Adventurer

 Very informative and interesting article. Thanks for sharing.

Do you have to have an eBay store to use the promotions feature.  I went in to check it out and it wanted me to set up an eBay store.  I don't have enough items for an eBay store at this point but would like to discount some items to sell them.  

by maxout223 · Adventurer

This was very helpful as this was something I always struggled with!,Thanks so much!


I list items for 5 days only, I pay for an anchor store so I have the listings to use, I often run 1 day flash sales and based on the new seller update i will no longer be eligible to run sales

by rgretro · Adventurer

Yes ^^ the sales tool is completely being taken away and won't be able to be used!!!! The Markdown Manager is going to be useless!!! This is a deathblow to my store's marketing strategy. My sales will take an immediate nosedive!


As a few other sellers wrote, this new sales limit will likely impact my sales negatively.  I have sales that last about a week through out the month. Because of the new two-week-listed limit, I'll only be able to realistically put a small percentage of my inventory on sale in a given month. I may have to rethink about having a store, because that was the main reason I chose to go this route and pay the monthly fee.  I've liked that the sales price is in red with the strikeover the previous price.  Many buyers, I believe, are drawn to that because it catches the eye and affirms the discounted price.  Because I operate a small store with mostly previously owned, 1-item inventory, I don't have the influx of return customers that larger stores with 1000's of the same item to sell, so this pending limit on my store's markdowns makes no sense. The reasoning for this new, looming restriction isn't stated well in the eBay announcement, and I don't believe this restriction will be of any real benefit for sellers OR buyers. In fact, I think it will be detrimental.


In the brick-and-mortar retail world, please name one store that is restricted by the "Powers That Be" on how that store can determine and launch its sales or markdowns.


Definitely useful information! Great article! 


This is absolutely detrimental to my business!!!


I sell a variety of different items many of which I list at the full MSRP price and use the sales to Discount down to a sellable price. From my experience people are more inclined to purchase an item that is discounted 40% when they see red price and strikethrough price, rather than when I list an item at an already discounted price people are less inclined to purchase that item because it doesnt induce the same excitement that they are getting a deal.


I run multiple sales usually for 3 to 5 days and relist the sales because of my experience customers will make purchases at the end of the sale and generally on the weekend. CS said I should list sales for longer duration... again usually my sales come at the end of the sale.  Now, if I have to wait 14 days in between sales it only makes sense to have to lower my listing prices to begin with. Hence less sales!


I spoke with a CS agent and was told eBay is doing this to prevent sellers from raising item price then putting on sale to sell at same price originally listed for. I say put a block on that activity if that is a major concern.  Example given by CS ..... item listed for $50, seller raises price to $60 then runs sale for 20% off = $48.


If my item has been listed for $29.95 for the last 6 months and i want to run a series of sales off that original listing price without changing it, why shoukd i ve penalized 14 days in between sales. 


I also like to coincide my sales with eBay bucks. More people watching items tend to buy when they get two deals at the same time.


Guess I will have to figure out how to proceed. I have to change my whole sales scheme which is going to take alot of time and research.


Way to go eBay Always make it hard for the " little guy"


Oh and I have two stores. One with 240 listings and one with 5000 listings!

by angdep-76 · Pathfinder

This is a NIGHTMARE for me, the $1,000 selling limit means that I can't get started selling things that are really worth money that I joined ebay to sell like Vacheron pocket watches 18K from tiffany 1880 that sell for $120K or the bikes I have that the frames alone sell on ebay for $2500.  WHY if I am paypal verified, I have a brick and mortar store in San Francisco with annual cash sales of over a million dollars and this is easy to verify. It's called Beauty and the Beasts and it's on taraval in San Francisco and I have an old website I paid for.  It has been in our family for 40 years and we have 10 employees but I can't even stretch my legs at 10 items or a grand

by mam98031 · Rockstar



The limits set on new sellers are there for a very good reason.  The exist to protect both the buyer and the seller equally. 


As a seller and especially a seller that wants to sell more high end products, you need time and experience to learn the Ebay selling rules.  That will only benefit you and serve to protect you.  Selling on Ebay is not simple nor is it without danger.  The rules for selling are complicated at best.  For sellers that are new, it is easy for them to be taken advantage of by a buyer that is seasoned and knows the rules.  


Take time, learn the rules, learn the pitfalls that can cost you too much money.  Learn about how buyers can file claims and you will end up refunding them.  Learn how to best handle these things.  It will only benefit you in the future.


Every 30 days you can call Ebay and request a selling limit increase.  Mark your calendar and do that.  As long as you are in good standing they will increase your limits every month upon your request.


Now the rules also protect buyers.  Before these rules were in place it was easy for a seller to sign up, sell some items, never ship them, pull their money out of PP and then be gone.  It was easy pickings for sellers inclined to steal from others.  These rules on new sellers prevent this from happening which in turn give buyers more protection.  And that is good for business.  We want our customers to feel safe when shopping with us.


Good luck!!!

by mam98031 · Rockstar



BTW, just in case you are interested.  If you want some help in how to construct and/or improve your listings, I'd be happy to assist you.  Just let me know.


I agree that this was informative. The sad thing is that it informed me that everything I was taught about marketing along with my sales was just thrown out the window. People do respond to that marked down price. If the retail stores like Best Buy, Lowe’s, Wal-mart, etc. were told they had to abide by the 14 day rule, not only would they be irate, so would the consumer. The crazy thing about all this is once my items become eligible for a markdown, I can have the sale last for 30 days, which is the default setting, or even longer. Not happy.

by joshhalie · Adventurer

This is a bunch of **bleep**! I run "sales" on items that have not been moving quickly. I noticed my sales drop DRAMITICALLY since this new "rule" went into place. I guess I'll have to look for another avenue to sell my goods since EBay don't seem to want my business. TOTAL **bleep**!

by roninor · Rising Star
Rising Star

The change made that requires 14 days between sales has caused my sales to drop about 60 to 75%.  Not sure what this means to eBay but to me it is catastrophic.  With all the pressure to develop a marketing stragedy this is what has worked for me for years.  Back to back continuos sales.  I started with eBay in 1998 and have seen a lot of weird changes which always comes back to help eBay not the seller.  But with all the competition by other ecommerce companies one come to mind Amazon why kill the golden goose.  At least for me.  For the first time I've got to consider moving my business out of eBay.  If my bottom line is being cut drastically how about other sellers.  Might not this also effect eBays bottom line as well.



I am getting this error: 

We can't discount items that are too new or have changed price recently. See help for details.




I am confident some if not all the promotions in question had the same price for more than 14 days.



How do I get this fixed.