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by _8lib 2157 days ago
Depends on the magnitude of the revenue increase.

One thing that inspired me to build [name-redacted] were the stories of sellers doubling their price and actually increasing their number of conversions. I haven't had a customer like that yet, but I had one person who reduced their price 30% and increased their conversions 5x+. In that case, it's pretty clear there's a winner.

1 comments

30% might work in software, but it's is a very deep discount for most physical retailers.

If the product has a 50% margin (sells for $100, costs $50 to source) then your retailer makes $100 for 5 orders instead of $50 for 1 order.

Except they're probably keeping their own inventory, so they now have to keep $250 of inventory for that $100 in profit, rather than $100. This is problematic because a lot of online retailers are limited by their working capital.

This is a drastically simplified example, but the bottom line is that physical retailers think very differently than software sellers.

Great idea for an app either way. I wish you the best of luck with it as you learn the territory. For something similar in the Amazon space (a platform that lends itself much less to split testing) check out splitly.com