In order to compete successfully online and win the digital shelf, brands need an optimized ecommerce pricing strategy.
Consumers are increasingly comparing prices across retailers before placing an online order. Ably assisted by comparison shopping websites and price comparison apps, it’s now easier than ever for shoppers to search for retailers selling products at the cheapest price.
Indeed, these sites have helped fuel ecommerce growth in recent years with 59 per cent of customers stating they prefer to shop online because comparative shopping is easier. And, research shows that low prices are now the single biggest deciding factor for shoppers choosing where to shop in 2022.
In order to optimize ecommerce pricing and protect brands online, they need to be monitoring the right pricing data. These are revealed in our new report: The insights to own a brand’s presence online.
The reports shows how monitoring the correct price data will ensure a brand achieves:
- Consistent pricing across all online channels
- Promotional compliance
- A competitive edge
Below are the key areas those looking to win the digital shelf need to thinking of to optimize their price online.
Monitoring channel pricing to ensure consistency is crucial since consumers are able to identify and take advantage of pricing irregularities more quickly and easily than before. A consistent price perception is critical. Inconsistent pricing can damage a brand’s reputation, reduce shopper loyalty and ultimately sales.
However, pricing is complex – there is no ‘one price fits all’. Our report recommends those looking to monitor prices, to track all forms of pricing information to ensure they adhere to the minimal advertised price (MAP) agreement and there are no violations or breaches, which could devalue a brand.
The pricing data that needs to be monitored includes:
- The list price or manufacturer’s suggested retail price (MSRP)
- The unit price, which is especially important for groceries
- The advertised price, which could also be discounted
- Prices for product bundles
- Volume discount pricing
- Welcome offer/voucher/ special deal pricing
Monitoring pricing across channels not only enables brands to spot violations and those sellers who breach MAP agreements, but it may also highlight unauthorized sellers. The latter can also a great way of flagging gray goods (the trade of a goods through distribution channels that are not authorized by the original manufacturer) by identifying those who are selling products significantly cheaper than they should be in certain markets.
As well as MAP compliance, analytics providers need to be monitoring promotional pricing across all ecommerce sites to ensure retailers are correctly implementing any agreed promotions. This can include bundle deals, in addition to the pure price.
Tracking this can help to identify any retailers who may be bundling products in an appropriate way, for instance, or even featuring free items in a discounted deal.
Location based insights
Location-based pricing and promotions should be tracked to enable brands to understand their promotional performance and compliance across different geographic locations. It might be that different pricing is needed in different locations, so brands need to monitor this accordingly.
Pricing also doesn’t have to be just different regional retailer websites either; it could be based on different zip codes or post codes using the same website. This means those building pricing insights need to be collecting and analyzing data using different regional proxies to monitor geo-location based pricing.
With consumers so focused on price, it is imperative to gather competitive price intelligence.
Capturing competitor price data helps brands gain an edge online. It can also help to pinpoint any popular ecommerce sites, which are selling a competitors’ products and which may provide an opportunity for new product listings. Those looking to monitor competitors should also be capturing promotional pricing and offers too, and comparing it with their own activity and plans. This means that price monitoring is no longer just collecting price data from the Product Detail Page (PDP), it also involves monitoring any price point, including paid banner ads or sponsored content which advertise prices to a shopper.
For retailers, monitoring competitor pricing is also critical. With the ease of online price comparison, if a retailer is not offering an optimized price, they will not win the sale.
However, monitoring competitor pricing can be a daunting task and involve collecting and analyzing an overwhelming amount of data. That’s why it’s important to work with an ecommerce data partner who can help navigate this, providing both the guidance and the data that helps win online.
Brands and retailers need to ensure they always remain optimized to win the digital shelf. We advise that pricing data should be collected several times a day at a bare minimum to react to the constantly changing online world. This is key since Amazon is reported to change the prices on its products about every 10 minutes.
However, it’s important to remember, price fluctuations are not constant. During peak trading such as Black Friday, Cyber Monday and Christmas price changes are more frequently and dramatically, so we advise that price data needs to be captured as close to real time as possible on those days.
Insights to own a brand’s presence online
To understand the data points you need to monitor to win online, download our report: The insights to own a brand’s presence online