When the Internet was in its infancy, it was predicted that every man and his dog would soon have their own online business selling products directly to consumers. Today, this dream has translated into an enormous online retail industry dominated by a few key players, notably Amazon and Ebay, that have changed the way we shop.
Sales on Amazon’s 3rd party Marketplace, which lets sellers offer their new and used items alongside the online retailer’s usual goods, reached $22.4 billion in 2012 according to market researchers Forrester Research. But competition in eCommerce is cut-throat, forcing sellers to become increasingly sophisticated in how they price their wares.
They are turning to firms such Israeli start-up Feedvisor, which provides marketplace re-pricing software that lets sellers constantly adjust their prices to stay competitive. Their signature product is platform that scans competitor’s prices thousands of times an hour and feeds these data points into its proprietary algorithm, for which it recently filed a patent. All this number-crunching gives users the power to adjust their prices in real time in order to optimize sales.
Unlike similar products by competitor firms Teikametrics, Sellerengine, and Channelmax, CEO Rosenman claims that Feedvisor’s fully algorithmic model is constantly improving as it gathers more sales data from Amazon’s API.
“Pricing software that exist on the market today require the seller to define a set of overly complicated pricing rules. These rules often conflict with each other, which can cause extreme price wars. Feedvisor is the first and only algorithmic solution, and we let online sellers outperform their competition without sacrificing their profit margins,” said Rosenman.
Rosenman launched the firm in 2010 along with the current Chief Marketing Officer, Yair Margolin, and, Eyal Laxner, the Chief Technology Officer. It has raised over $2 million to date and has the backing of a number of Israeli venture capital firms such as JAL Ventures, Oryzn Capital, and Micro Angel Fund. By the end of 2014, the firm is aiming to pass the $3.5 million revenue mark, with plans to increase that to $10 million by the end of 2015.
The biggest challenge Feedvisor currently faces, according to Rosenman, is recruiting the right people to its expanding team. With such a scalable business in a booming industry, Rosenman is keen to ensure that customer service is not damaged by the firm’s rapid growth. Rosenman and his team are currently eyeing up European markets, particular Germany, as being ripe for expansion. Big Data analytics has already revolutionized the financial industry; if Feedvisor can reach its target of tripling revenues in a year, then it may well revolutionize the eCommerce industry too.