Amazon repricing and the race to the bottom

Many Amazon sellers there days are using Amazon repricing, the practise of repricing offers so that they are the cheapest within max and min price limits.  What you sacrifice in margin you make up in volume, or so the theory goes.

I have so far avoided this strategy (though I think we will succumb very soon) reasoning that our margins were low enough as it is.  There have also been a few scare stories in the press worrying about automatic robo pricing causing prices to go out of control and merchants to go bust.   This seemed a bit daft to me as surely merchants can set their own minimum selling prices based on their costs.  There can’t be many merchants stupid enough to sell their products below cost…..

Anyway, it occurred to me that Amazon repricing has some of the features of a reverse auction marketplace where sellers vie to put in the lowest price to make the sale.  With the popularity of repricing tools both stand alone and integrated into platforms like eSellerPro and Channel advisor, I wonder how long it will be before Amazon makes this a more formal part of its platform.  Let the race to the bottom begin!