A new product has three jobs: **collect reviews, climb organically, and find the keywords and ASINs it converts on.** All three run on advertising, and advertising runs on conversion rate.

**Which is the problem.** A new listing has no reviews, so shoppers have no reason to choose it, so it converts badly, so ACOS is high — and the very campaigns meant to fix the review problem are throttled by it.

**Price is the fastest lever you have on that loop.**

[Watch the walkthrough](https://kb.trackiq.com/kb-assets/kbvideo-launchprice-explainer-8b054457.mp4)

*Prefer to watch? One hundred and sixty-eight seconds on checking ACOS against your margin first, finding the price that makes you the best offer, and why the test is reversible.*

## **First, check whether you have the problem at all**

**If your ACOS is running 10–20% above your gross profit margin, your PPC is converting acceptably.** Leave the price alone and keep working the campaigns.

**This framework is for the other case:** hard to find any keyword or ASIN with a decent ACOS, and a conversion rate that is low against your category.

**It fits best on products with high gross margins, or products whose average ACOS has been very high from the start.**

## **Step 1: find out where you actually stand**

**Build the comparison** — 7–10 direct competitors, their prices, their pack sizes, their price per unit, reviews and ratings. See [**The Product Comparison Table**](https://kb.trackiq.com/hc/knowledge-base/articles/the-product-comparison-table).

**What you are looking for is who currently offers the best value for money in the niche**, and where you sit against them.

**Done when your product sits in a table beside its real competitors, not beside a category average.**

## **Step 2: find the price that makes you the best deal**

**Read off the price at which you become the strongest value-for-money offer in the niche.**

**That is your target price.**

**A large share of Amazon shoppers are explicitly looking for the cheapest reasonable option**, so becoming the best deal in a niche moves conversion rate more than almost anything else you can do in a fortnight.

![Your price against the niche, per unit](/kb-assets/shot-b25-cmp-view-7ba90b.png)

**Knowing the price that makes you the best offer means watching competitor prices as they move, not once** — see [**Tracking Competitor ASINs Alongside Your Own**](https://kb.trackiq.com/hc/knowledge-base/articles/tracking-competitor-asins). A price set against a snapshot from three weeks ago is set against a market that has moved.

## **Step 3: check what that price does to your margin**

**Put the target price into your pricing table and read the gross profit margin before PPC** — see [**Where Your Margin Actually Goes**](https://kb.trackiq.com/hc/knowledge-base/articles/where-your-margin-actually-goes).

**Above 10–20%** — worth testing for the next **2–4 weeks**, then raise the price slowly once sales have real traction.

**Below 10%** — raise the price until you clear **10–15% gross margin before PPC**, then check the comparison again. **If that price still puts you in the top 5 offers in the niche, test it.**

**And there is a deliberate exception.** If you genuinely believe in the product, you can go to a negative gross margin to buy traction and raise prices afterwards. **That is an explicit bet, not an oversight** — take it knowingly or not at all.

## **The decision, and why it usually goes this way**

Two options:

**Lower the price** and see whether conversion and sales traction improve.

**Keep the price** and try to make PPC better through targeting alone.

**PPC is the largest expense in growing a new product**, so anything that makes every campaign convert better improves the economics across the whole account — which is why the price lever usually wins.

## **It is reversible, which is the point**

**A price change is one of the few genuinely reversible decisions here.** It might work very well, it might do nothing, it might land somewhere between.

**If it works, good. If it does not, put the price back.**

**But if the product will not sell even as the best deal in the market, price was never the problem.** That points at the design, the offer, the bundle, or simply the absence of reviews — see [**Designing the Offer**](https://kb.trackiq.com/hc/knowledge-base/articles/designing-the-offer) and [**Vine: Reviews for a New Product**](https://kb.trackiq.com/hc/knowledge-base/articles/vine-reviews-for-a-new-product).

**That is a useful answer too**, and cheaper to learn from a two-week price test than from six months of advertising.

## **Common mistakes**

**Cutting price on a product whose PPC is already converting acceptably.**

**Comparing shelf prices** instead of price per unit, and mispricing the whole exercise.

**Testing a price without checking the margin**, and discovering the cost afterwards.

**Reverting after four days.** Two to four weeks is what it takes for conversion to show.

**Leaving the launch price in place** after traction arrives, instead of raising it slowly.

**Concluding the product is fine** when it will not sell even as the best deal in the niche.

## **Related**

- [**The Product Comparison Table**](https://kb.trackiq.com/hc/knowledge-base/articles/the-product-comparison-table) — the input to this decision.
- [**Pricing and Gross Margin**](https://kb.trackiq.com/hc/knowledge-base/articles/pricing-and-gross-margin) — the margin side of the same trade.
- [**Deciding Your PPC Daily Budget**](https://kb.trackiq.com/hc/knowledge-base/articles/deciding-your-ppc-daily-budget) — the other launch-stage decision.