Price Management

How to Price Private Label Products

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Sometimes if you don’t like the way things are done, you have to change them yourself. That’s the mentality a lot of retailers have, especially on the Amazon marketplace. This has helped the presence of private label products really take flight. These products are similar to the manufacturers’ but are labeled as a retailer’s own brand. If you walk through a store, you’ll often see that retailer’s own brand of products (Target tissues, Safeway brand spaghetti sauce, etc.) These are all private label products.

Private label products provide retailers with a lot of benefits. First, they cut out any tribulations that may arise from working with a manufacturer (ie MAP violations). Because the retailer doesn’t have to work with the manufacturer for that product, they get more control over how to sell the product. This often also leads to wider margins and a better way to tailor the customer experience, since they don’t have a manufacturer’s planogram or guide dictating how they display it.

Private labels can make things complicated, though. Because they are unique products, they have unique UPCs that are hard to track against other retailers. For example, since Target is not carrying any Walmart-labeled products, matching UPCs in order to reprice is not an easy task.

The easiest way to reprice is by using your competitors’ overlapping UPCs. That way you can match your products and compare prices. Private label brands have brought about new UPCs that are nearly impossible to match. But luckily, there are ways to simplify the matching process between private label products and nationally recognized brands.

If You Carry Your Own Brands

If you’ve decided to include private label brands in your assortment, then that means you have to price them against similarly designed and branded items. But without a UPC match, the repricing process is nearly impossible to carry out. Luckily, there are still ways to price your private label products against your competitors’ and still have optimized pricing.

Wiser has a couple of ways you can price with private label brands. The first tool is fuzzy matching. Fuzzy matching is basically matching on attributes other than UPC. So instead of using a code, it uses attributes such as size, color, type of product, and more. It finds products from select competitors by scanning the web for these attributes and inputs them into our visual spy agent tool.

Visual spy agent (VSA) allows you to review the matches yourself before approving them and price against those products.

If You’re Pricing Against Private Label Products

You’ll face similar UPC problems pricing against private label products. Luckily, Wiser can still help you perfect your pricing process against these products that were once deemed unmatchable.

Best seller assortment allows you to get a view of the best sellers on different websites, like Amazon. This is great to compare your assortment overlap, but it’s also incredibly useful to see if there are any private label brands that are truly a threat to your brand. Because the truth of private label brands is that they just aren’t as popular as nationally recognized ones, unless there’s a recession.

By reviewing your best seller assortment results, you can find private label brands that could be competitive against your similar products. Most private label brands are priced much lower than nationally recognized ones, so much so that you may not be able to undercut them. But if you have a more reputable brand, there’s a greater chance of winning the sale.

In both cases of competing with or pricing against private label products, the ultimate goal is to stay aware of your competitive assortment and keep tabs on your competitors. The best way to do this is with Wiser’s best seller assortment.

Editor’s Note: This post was originally published in February 2016 and has since been updated and refreshed for readability and accuracy.

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