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Improved Profit Margin per Sale for an Online Retailer of Video Games through Automated Marketplace Demand Generation and Re-pricing Technology Solution

Executive Summary

The client is an online retailer of video games for all major platforms ranging from PC, Nintendo, Wii, Xbox to Playstation 3 and PSP.  They source these games from wholesale games suppliers and then retail them on Amazon and eBay market places. The client wanted to leverage the wealth of information provided by these market places and games suppliers to build market intelligence to improve profitability per game without compromising on the sales numbers.  

Sigma Infosolutions leveraged its expertise in areas like web technology, analytics, and intelligence to build a technology solution.
The solution would automate data aggregation from distributed and disparate applications
and build unprecedented analytical information to drive informed business decisions.  

The Client

The client is an online retailer of video games for all major platforms ranging from PC, Nintendo, Wii, Xbox to Playstation 3 and PSP.

Business Case

The client retails video games on popular marketplaces like Amazon and eBay. They source games from multiple vendors and push it to these market places. The client wanted an automated system that could aggregate:

1. Cost versus game information from different suppliers
2. Demand of all games on the two marketplaces

Using this information, the system would run a cost-benefit analysis and opportunity rank analysis to recommend the best price for each game. They further wanted to build on this data to automate game ordering process which could be further integrated with their
inventory management system. 

Also, in order to ensure the price-freshness of each game listed, the client wanted a system to check for various trends on each marketplace for each game and then automatically reprice them for optimized sales. With this vision, the client partnered with Sigma Infosolutions.


The wholesale games suppliers send information in different formats ranging from pdf to .XLS. Also, the format in which each supplier sends information varies from time to time. Therefore, due to the lack of standardization, tracing the origin of the document to debug an issue took a lot of time. However, this never crippled Sigma Infosolutions to roll out functionalities as per the schedule and budget. 

The system interfaces with Amazon and eBay in order to build intelligence on each game. Therefore, it was a challenge for Sigma Infosolutions’ team to build a system which could work seamlessly with Amazon and eBay APIs even while they were undergoing version upgrades.

The whole engagement with the client was carried out without an onsite presence of Sigma Infosolutions team. The team was interacting with the client’s CTO, who was the guiding force behind this project but was traveling quite often. Hence, it was a challenging task to coordinate with the CTO. This also made collating and documenting
inputs at various stages of the engagement quite an uphill task.

Sigma Infosolutions used the following technology for this project:
• Python 2.5.2
• Django 1.2.1 with other plug-ins
• LXML and BeautifulSoup parsers, XLS parsers
• Mysql DB 5.0 

Business Benefits

The client enjoyed the following business benefits:

• Real-time insight into demand generation for each game on each marketplace
• Accurate price management based on real-time comparative analysis of each game listed on each marketplace
• Supplier-wise pricing comparison for each game
• Achieved a real-time supply chain
• Trusted technology partner for future functionality development
• Increase in profit margin per sale by almost 30%

The Solution
The client selected Sigma Infosolutions for its in-depth experience in web technologies and retail domain. The team provided its expertise on building specifications, new application development, and testing.

Following are the key applications developed to facilitate the kind of automation envisioned by the client:

1. Supplier aggregations: The application automates the weekly/monthly data aggregation process from multiple wholesale game suppliers to gain visibility into each supplier and the games they provide at the best cost.  

2. Marketplace demand generation: An analytics system that provides unprecedented visibility into opportunity, margins, pricing, competition, and popularity associated with each game that is to be listed on Amazon and eBay. Based on these parameters the engine also recommends the best price for each game to ensure maximum profitability and sales.

3. Automated order management: Based on the analysis derived from both supplier aggregation and market demand generation systems this application automates the games ordering process. It generates an order receipt and then notifies the client which games in how much quantity are being ordered to which supplier.
4. Repricer application: An automated price management application which enables the client to adjust prices of the games listed on online marketplaces like Amazon and eBay.
The client can schedule automated repricing for all or specific games based on the comparisons made with other competing prices, conditions, seller rankings etc. within the price range specified by the client.

Sigma Infosolutions team integrated the automated order management and repricer applications with the client’s existing inventory management system. Once, the client receives the order from the supplier, they manually clear the order receipt in automated order management application from where the inventory management system automatically gets updated and then the games are directly listed on Amazon and Ebay marketplaces. Also, the repricer application interfaces with the inventory management
system to feed it with the re-pricing information on all or specific games for automatic re-listing or deletion from the market places. While working on this solution, Sigma Infosolutions also recommended the client to aggressively adopt open-source technologies and frameworks to further improve their profitability.  Since, Sigma Infosolutions understood the nuances of the client’s business extremely well and this engagement had already reaped its benefits, the client chose Sigma Infosolutions as trusted technology partner for future development needs.

Accurate price management based on real-time comparative analysis of each game listed on each marketplace

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