Pricing intelligence can help
retailers remain competitive.
In recent times, many merchants have focused the majority of their resources on developing their omnichannel retailing
strategy. They want to ensure online and offline elements are fully integrated with each other, so a shopper can seamlessly start their journey on one channel and go in between others as they see fit before finally making a purchase. The pursuit of this goal has led retailers to make sweeping changes, involving everything from their supply chains to the use of specific eCommerce technologies.
In the midst of all this change, it's easy to forget about many of the cornerstones that truly make retailers successful. As RetailingToday contributor Alexander Rink noted, pricing remains incredibly important for merchants
. It's one of the original areas in which many retailers began actively competing against one another, and despite all the other changes affecting the retail landscape, it continues to be a critical part of retailers' efforts.
"Today's shoppers know instantly when a retailer is under-priced and when a retailer is over-priced," Rink explained. "Retailers who don't have the same visibility are asking for trouble. For example, a retailer lacking pricing visibility is likely failing to convert on some products, and giving away precious margin on others. Not only that, but an inconsistent pricing strategy fails to reinforce a retailer's brand image and associated value proposition, jeopardizing hard-earned customer loyalty in the process."
Getting competitive with pricing
Customers are continuously in pursuit of the best prices. Although they won't always bite on the lowest price, they will take this factor into consideration.
Merchants must start their pricing strategy by setting costs relative to their competitors. Benchmarking should keep a broad perspective, taking note of the retailer's place locally, within its niche and globally. Merchants that operate within highly specific niches may be able to set higher prices compared to national online sellers with a broad reach, for example.
Merchants must also be able to respond dynamically to changing prices. Some retailers are taking real-time action when it comes to setting prices, making adjustments based on time of day, day of the week and other factors. The quicker retailers realize that if prices aren't always static, they'll be able to better compete with other merchants.
Finally, retailers need to ensure their prices are consistent across all channels. Although this is becoming less commonplace, nothing is more frustrating for customers then researching an item online and heading in-store only to find it costs more money.