The world of e–commerce essentially revolves around the theory of “right price at the right time”. Online shopping has primarily become comparison shopping whereby today’s consumer browses through 10 different websites to find the right deal. This simply means that if your prices aren’t rivaling that of your competitors, you’ll definitely lose out on sales. A typical consumer today checks out various websites and sometimes even use comparison websites, like Google Shopping or SlickDeals, to look for the most desirable deal. In such a competitive scenario, retailers are grinding themselves too hard in the battle and competitor price monitoring has become an indispensable trick.
5 No-Brainers – Why Retailers do Competitor price monitoring
Based on a consumer’s search patterns, Google search or other comparison search engines will primarily focus on results which are more likely to convert to sales. This typical search pattern is hugely determined by the consumer’s purchasing power. If the price of your product doesn’t fall in the range of consumer’s budget, your product will not be shown in the search result. This means that the consumers have no idea if your product exists, ultimately leading to a fall in your sale and profits.
Your pricing in relation to your competitors
Unless you know where you’re pricing tactics stand in relation to that of your competitor’s, you will be on the losing side. It is imperative for any retailer to know whether their prices are higher or lower as compared to that of their competitors and will changing it be beneficial or not. A 1% percent slash in prices may not amount to much but may lead to higher sales. To be able to predict this is the key to success for any retailer and that is why competitor price monitoring matters so much.
Study pricing and ace the marketing exam
Figuratively speaking, pricing is the cheat code for almost every marketing problem ever. Any retailer who is not looking at the competitors pricing tactics is missing on a huge number of opportunities to succeed.
With a new marketing gimmick around the corner every day, marketers have become smart. They know the exchange rates, they know the value and cost of their product down to every cent. To not keep an eye on the competitor can be a fatal move. One could be losing market share without even realizing it.
Learn to distinguish yourself through price
When starting up, your price fix will distinguish you from your competitor. The key to do this is to be well aware of your competitor’s pricing patterns. Through competitor price monitoring, you can keep an eye on when and why prices alter dynamically. This is especially helpful if you are entering a market where there is no leader, but all the players have an equal chance.
Low price and value aren’t mutually exclusive
Low prices don’t necessarily mean disparaged values. Today’s buyer bases his/her decision on pricing, brand image, the credibility of the brand and retailer, ongoing sales etc. But pricing still continues to remain one of the key factors in influencing a buyer’s decision. It is very important to meet the competitor at lower prices to gain and retain customers. One strategy may be to compete on price on a few items that you can afford until the customer gets to know you better. For this to work, the seller needs to know the profitable price. Use loss leaders; focus on particular products, niche selling, etc.
It’s becoming increasingly hard for online sellers to survive without cleverly pricing their products and meeting the competitor head-on. How one does determine the correct price for a particular product can be hugely determined by competitor price monitoring.
The good news is competitor price mentoring is affordable, accessible and expandable. Try a hand at competitor price mentoring with us at Datahut, your big data experts.