Pulling up on the death spiral of price drops

Running a business has many moving parts. The more you can automate, the more it frees you up to address high level strategic challenges of your business. This is a newsletter about automating aspects of your business.

Story and Problem

When I was working at Pebble, a smartwatch maker, we had a couple different channels to sell through: our own eCommerce shop, physical retailers, and Amazon. When you work with a large distributor, and you're a smaller product company, they naturally want to de-risk their investment in selling your product on their site.

One of the ways Amazon de-risk is to stipulate that if there is a lower price somewhere on the web, they will automatically lower the price of your product listing on their site within X hours of discovering the lower price.

This is normally not a big deal, because our sales team would sell for the same price across different channels.

This is where online fraud steps into the picture. Fraudsters would be dropshipping Pebbles on eBay and purchase Pebbles on our eCommerce shop with stolen credit cards. In order to attract buyers on eBay, they would purposely list the price of a Pebble 10-20% lower than the retail price we had on Amazon. This would set up automatic price adjustments at Amazon, if it wasn't rectified within a certain amount of time. This can spiral out of control if not monitored, especially if other channels selling your product caught wind of the price drop and threaten to lower the prices of your product on their site.

For a while, we relied on just someone noticing manually. But eventually, we built a rudimentary webscraper to detect price drops on eBay, and notify us on Slack if that was the case. Then we would take action with our counterparts at eBay to look into delisting the repeat offenders.

Automation

Nowadays, it's much easier to do this sort of thing. You can use a visual webscraper like Parsehub, Diffbot,to scrape eBay search listing for Pebble prices. Then, using any workflow manager with integrations with a webscraper, like Zapier, you can easily route the results of the webscraping to Airtable or Google Sheets to track it over time. And from Airtable, you can find all listings lower than the price scraped from the Pebble eCommerce site. If there are any listing that fit the criteria, send a notification to Slack.

• Diffbot alternatives
• Zapier alternatives
• Airtable alternatives

• [1] Pebble is the now-defunct smartwatch maker. They were acquired by Fitbit later on.

Photo by Tirachard Kumtanom from Pexels