Visiting the new offices of Feedvisor, the engine helping Amazon sellers raise prices and still win the Buy Box
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Victor Rosenman, CEO of Feedvisor

Feedvisor has doubled in size over the past year as repricing engines become indispensable on Amazon

Amazon’s domination of e-commerce has democratized online sales. Because of the company’s centralizing effect on retail, larger stores are now competing with smaller ones for customer attention. While it used to be as simple as overwhelming a smaller competitor by overstocking goods and selling products at a lower price, Amazon’s rating system has put pressure on bigger retailers.

That has produced demand for better data on keeping stock and repricing products to keep up with a dynamic market. As new players enter the game, a few startups have answered the call to automate the practice of changing prices.

“The first year I was working alone from home. Then the second year was the first angel investment and I was able to hire two more people,” Feedvisor Co-Founder and CEO Victor Rosenman told Geektime. Rosenman says Feedvisor has been a “real” company since 2013, in a manner of speaking.

Feedvisor is perhaps the most prominent of the companies offering repricing services. With retailers now battling competition from across the web, their algorithms offer some serenity for clients by not only changing prices automatically to compete with new sellers, but also even raising prices automatically should market conditions (and the number of direct competitors for a given product) change suddenly.

The view from Feedvisor’s new offices across the street from the diamond district in Ramat Gan (Gedalyah Reback/Geektime)

They have stiff competition in the form of XSellCo, Appeagle, Sellery, and RepriceIt. A common mistake sellers might make when shopping around for a dynamic price-changing tool is that the lowest price is the only factor in winning feature status on the site.

“Everyone assumes it’s a rush to the bottom,” says Dan Krasnostein, partner at Square Peg Capital and investor in Feedvisor. “It’s not true, nor is it what Feedvisor is trying to achieve.” He says they want vendors to say, “‘Not only did they generate me more sales, but achieved me more sales based on a higher price.'”

And that service has been invaluable. Feedvisor just left their old Tel Aviv office to take over nearly an entire floor of a new skyscraper in nearby Ramat Gan. They have doubled their employee count from about 50 a year ago to 100 today. They also have offices open in New York and in Seattle in proximity to Amazon headquarters.

Rosenman sees one major trend in e-commerce is “the migration of wealth from standard ‘biplane businesses’ to platforms that organize smaller umbrellas of companies or individuals.” With the infrastructure to make deliveries from a hefty number of local distribution centers and a prime membership for just $100 to get free delivery, Amazon has changed everything.

“It was so big that it could create a physical network of caching nodes based on a solid network of distribution facilities.”

A look inside the break area of Feedvisor’s new headquarters (Gedalyah Reback/Geektime)

Forrester estimates that Amazon accounted for 60 percent of all e-commerce growth in the US from 2014-2015, which should account for about a quarter of all American retail sales says Rosenman. Rather than serving the plethora of small vendors on the platform, Rosenman explains Feedvisor serves as a platform to help larger sellers to be successful and “survive.”

Amazon ranks sellers in multiple ways, but one spot stores want to be is at the top of the recommended list of items in the Amazon Buy Box. If you can get to the top of that list, customers shopping on a competitor page might see your listing featured at a better price or a better seller rating, then migrate to your store to make the purchase instead.

One of Feedvisor’s new meeting spaces (Gedalyah Reback/Geektime)

Besides price and standard seller rating, Amazon factors in scores on shipping, prioritizing customer support, and seller method of fulfillment. If you opt for Fulfillment by Amazon (FBA), this can help your score.

“We solve the basic problem of complexity of their business: competition, prices, demand (which changes, but over time and is relatively steady), and managing their inventory,” Rosenman explains. “What changes faster is your ability to be in the top rank, which is greatly affected by competition. The velocity of sales is correlated by demand.”

They try going beyond balancing stock, using business intelligence to make decisions based on market position of competitors, recommendations on when to stop and start advertising, when to rely on organic traffic to your site, and consolidating other market information. The return of rate of products, the refund rate, and defective order reports also factor into the analysis.

Rising challenges and keeping pace

One of the corridors in Feedvisor’s Ramat Gan office (Gedalyah Reback/Geektime)

One of the bigger changes in e-commerce has been the rise of indirect competitors. There has been a marketplace shift there has been an explosion of private label products, so says Rosenman, which makes it tough to anticipate the rise of a competitor expanding its product offerings.

“How do you assess what is a competitor to the iPhone and what is not? We started looking at products that had a lot of competition for a particular product. In order to win they needed to set the optimal price thinking about the competition. But now it’s the case you might not have direct competition but are competing with others selling [just] the case.”

Another big change is the blossoming refurbishment industry. Making phones and computers ‘good as new’ isn’t what certain people want, and people sometimes miss that detail in product descriptions. While sellers don’t get long-feared Amazon penalties for it, it causes headaches in terms of distribution, returns, refunds, and customer satisfaction.

Amazon launched a new Certified Refurbished section of the website at the beginning of November, so it remains to be seen if this will have any impact on sales.

Feedvisor sells itself as the total package that keeps up with changes in the industry and on the site for you. Unlike, say, the SEO industry where a rule change by Google can send shockwaves through the digital marketing world, Feedvisor can recalibrate quickly if Amazon were to dramatically change its rules.

“We aren’t gaming the system. We’re fixing the system. This is exactly hat Amazon wants,” Krasnostein says emphatically, playing up Feedvisor’s machine learning algorithms. “When there’s a change in Amazon rankings, you need to re-program everything. For Feedvisor it doesn’t happen.”

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