|Tue July 17 2012 22:04:39|
Amazon to Protect Merchants from Repricing Glitch?
By: Ina Steiner
Imagine getting a $25 item for a penny - what a great deal for a shopper. Now imagine you're the seller, and the one-penny price was a mistake caused by a glitch in your vendor's software. That could have a drastic effect on your bottom line.
That scenario played out today for 15 minutes when a glitch caused by a third-party software company called Appeagle caused some of its clients listings on Amazon to sell for a penny. According to Appeagle, Amazon jumped in when notified and cancelled the FBA orders and told Appeagle it wouldn't count the cancellations against the merchants' performance metrics, including orders cancelled by merchants themselves for merchant-fulfilled orders.
Note I've yet to hear confirmation from Amazon itself on how it will handle the occurrence, and there are merchants who are dissatisfied with Appeagle's handling of the situation - you can read the details of the incident in Wednesday's EcommerceBytes Newsflash newsletter.
Appeagle's Zee Mehler said Amazon was "all over it" to help resolve the issue when the glitch was uncovered fifteen minutes into pushing an upgrade to its software. "They did right by us," he said, "because they knew we were working hard to do right by them." Mehler said the glitch occurred when Appeagle was pushing an update through to Amazon to conform to new requirements that all repricing software vendors must meet.
Why was Amazon responsive, and why did it get on board with cancelling the one-penny orders when it is so customer focused? It likely because Amazon is a retailer too and understands the cost and impact of major pricing errors.
I can recall many a glitch on eBay that resulted in auctions selling for less than they should have thanks to bidders not being able to access the listings. Would eBay be as responsive - and proactive - if a similar incident occurs on its marketplace?
It's interesting to think about the way the two marketplaces differ in terms of pricing. Auction sellers place an item on eBay, and bidders drive the prices up - good for merchants. On Amazon, prices are actually driven down - not nearly as exciting for merchants!
Repricing is much more common than many sellers realize, and it's unlikely that today's incident will have any significant impact on the demand for repricing automation tools.
But the incident does drive home the importance of paying close attention to repricing tools and setting minimum prices to try to avoid becoming the victim of a repricing meltdown!