Does it sound familiar? Going to a store, finding something to buy, comparing it with other alternatives and finally starting to feel an irresistible desire of owning it? The final step is checking the price tag to see how much the item costs – then it’s decision time.
If there is no deal or bargain, you face a dilemma of whether or not to purchase it. If it’s a particularly expensive item, you know you’ll have to sacrifice something to compensate for it. After a while of uncertainty, you probably give up, return the item to the shelf and leaving the store all together.
Why Pricing Matters in an Online World
If we analyse this traditional in-store behaviour and compare it with online retail habits, it’s clear that pricing matters much more in the online world.
One of the first things that an online shopper notices while jumping from one product page to another is the price. The price is just standing next to the product name and image. You can’t stop yourself from looking at it while scanning the rest of the page. It inevitably affects you, triggering your purchase intentions.
If the price is reasonable, then you look into product descriptions, shipping options, sizes, and so on. In a nutshell, price is the major decisive factor for an online shopper, and the initial barrier that ecommerce retailers need to continuously overcome.
Retailers should never underestimate the power of the online shopper. First, they have enormous variety of choice in the ecommerce market. If your offerings don’t satisfy their expectations, believe me, they won’t hesitate to leave your store for a competitor in seconds.
Besides that, thanks to the price comparison engines online shoppers are finding it easier than ever to find the best prices for the products they want to purchase.
Let’s see look at some striking findings;
- In a recent study, 60% of online shoppers named pricing as the main purchase criteria.
- 90% of online shoppers say that they research products using price comparison sites.
- Ecommerce website traffic from various price comparison engines averages around 20%. In price-sensitive industries such electronics, the rate is higher and price is even more captivating.
The Rise of Automated Pricing
By combining this online shopping behavior and fierce competition in ecommerce, it’s clear to see just how dynamic the online retail world can be in terms of pricing.
Online shoppers are incredibly eager to compare your prices with your competitors’. So setting random prices across your product range, or ignoring your competitors’ pricing strategies altogether, is not a wise business approach!
Knowing your real position in the market by analysing competitor pricing behaviour should be one of your highest priorities.
Many ecommerce retailers often feel pressured to having a real-time, dynamic pricing strategy, keeping them one step ahead of the competition. Unfortunately, many other online retailers fail to keep up with this change.
Most retailers do this research manually. This approach is too-often a time-consuming, costly and frustrating task, often fraught with inaccuracies. Can you imagine how many work hours you need to track different competitors’ prices on 500 products?
In order to overcome this problem, taking advantage of automated price tracking software is becoming an increasingly more popular solution. These solutions let ecommerce businesses track competitor prices automatically, gain market intelligence and set dynamic prices.
This helps you identify whether you have the lowest or most expensive price compared with the competitors that you’re tracking. You can then easily respond the market and adjust your prices in line with competitor activity, attracting more traffic (and conversions) from price comparison engines.
On the other hand, it’s possible to increase your prices while staying competitive in the market. In these cases, you can set fattened margins to help increase your profitability. You can also receive alerts when your competitors are out of stock, which will help you dominate the market further.
Investing in your marketing channels, such as AdWords, social media, and retargeting is also a great way to take advantage of this opportunity and boost your sales.
Expectations from an Automated Price Tracking Software
Setting automated pricing strategies with competitor tracking software is no longer a big challenge for ecommerce companies. To get started, you first need to answer these two basic questions:.
- Who are your competitors?
- What are your most important products?
Once you’ve figured this out, the next step is adding your products and competitors’ URLs to the automated price tracking software that you’ve chosen. The software will then do all the hard work for you, tracking the price and stock availability of every product and URL that you’ve added.
The critical part is the prioritisation of certain products. The best advice is to always select those products that have bigger sales and margin, as it’s on these products where you stand to gain the most.
By setting alerts, you can receive email notifications whenever one of your competitors changes their pricing, and this real-time data allows you to respond to the market like never before.
You can also expect to get historical data from the automated price tracking software that you’ve picked. This helps you to generate better insights in to how competitors’ set different pricing strategies for different products or categories over time.
In a such dynamic world, ecommerce retailers need to be constantly updating their pricing strategy if they are to beat their competition.
Automated price tracking solutions help online retailers to build a dynamic strategy, helping them gain an advantage over their competitors and to improve their monitoring abilities.
With automated solutions like Prisync , you can save tons of time to focus on data analysis and price optimisation. You will also ensure that consumers don’t leave your store for lower prices on a competitor’s site.