Are you tired of constantly losing out to competitors on price? Are you looking for a way to stay competitive and maximise your profits? If so, your business should start adopting price intelligence solutions, which use a pricing model that involves monitoring and analysing the prices of products or services in relation to those of competitors. Thanks to data mining solutions retailers and brands are able to optimise their pricing strategies and become market leaders.
In this ultimate guide, we will introduce you to the world of price intelligence and show you how it can benefit your business. Whether you’re a small business owner or a large corporation, this guide will provide you with the knowledge and tools you need to succeed in today’s fast-paced and highly competitive market.
As the term already suggests, price intelligence is an approach that deals with the use of intelligence (data mining techniques) for the extraction, analysis, and optimisation of prices. Unlike other methodologies, this one provides companies with accurate pricing information in real time.
The truth is that traditional pricing methods do not work in today’s volatile online environment anymore, which is characterised by changing sales channels, customer behaviours, and economic conditions. In order to tackle these challenges retailers and brands need to implement competitive pricing solutions. These powerful tools can help you track and analyse prices across your industry, allowing you to make informed decisions about your pricing strategy. By implementing price intelligence in your business, you can gain a competitive edge, improve your profitability, and better serve your customers.
Working with intelligent data solutions can seem complex at the beginning, but we have gathered some key information on how these price intelligence solutions work, using as an example our own Netrivals solution:
Before making the tools work for you, you should…
Once the software has everything it needs to start working, here is how it functions:
Now you know how the software works, but how can the collected data benefit your job and e-commerce business?
In short: Price intelligence solutions make your work as a professional in the sales, marketing, or pricing department more efficient by giving you:
Overall, with the help of price intelligence, you can enhance your pricing strategy, become more competitive, and boost conversions by analysing the market and gathering pertinent data from your rivals. In case you are still not convinced about the importance of price intelligence for your business, we have also gathered a list of the top 7 reasons to use price intelligence software, which you can access here.
Price intelligence is often used as a very broad term which is why it is important to understand its different solutions and implementations for brands and retailers selling online.
First and foremost, it is important to understand that retailers do not have the same needs as brands, and vice versa:
Retailers usually focus more on monitoring how other retailers are pricing the same products on different platforms. This means using price intelligence solutions like:
Brands, on the other hand, tend to focus more on how online retailers are pricing their products, if their products are out of stock, and how other brands are pricing similar items.
Below you can find the most relevant solutions for brands:
Did you know that…
Among all other pricing solutions, Netrivals is the only price intelligence platform able to offer all features listed above?
As you can see in both images, online sellers can really cover all pricing challenges on all types of sales platforms (direct web, marketplaces, and marketing channels), and this is thanks to big data storage and sophisticated software systems.
Lastly, here are some essential tips for both retailers and brands:
After carefully examining how price intelligence can benefit businesses, here are two success stories from retailers that chose Lengow’s pricing solutions, Netrivals:
Since its launch in 2014, Sobrico has established itself as one of the top players in the French DIY market. With more than 40,000 products in its catalogue, this online store faced the challenge of maintaining all the prices and ensuring competitive pricing at all times.
For this reason, Sobrico chose Netrivals as its go-to pricing solution which helped it achieve:
With over 70 stores all over Andorra and Spain, this family-owned beauty company has grown into a market leader known for the best products with the highest customer service. However, the company was losing too much time searching for pricing data manually. Therefore, it needed a pricing solution that solved that but also helped with the growth of its customer base. Netrivals was able to help it:
Here are some of the latest trends in price intelligence (Last Update: December 2022):
This pricing strategy, and one of many Netrivals’ features, consists of adapting prices to dynamic market conditions, allowing retailers to always optimise their prices in real-time and become more competitive. As shown above on the worldwide Google searches of the last 5 years, “dynamic pricing” has never been more popular, especially one week before Black Friday (13-19.11.2022), which indicates the sellers’ interest in using such an approach to offer the best prices during that period.
Marketplaces and price image
Today it is usual for buyers to discover various pricing for the same goods across several marketplaces. Guess which product this consumer will buy if they notice that yours is being marketed for a lot more on a marketplace than those of your competitors? Exactly: not yours. It’s possible that your product costs two times cheaper on another marketplace, but it’s also possible that this customer has no idea.
Therefore, brands and retailers should gain more control over their products’ price image, which is known as the perception of your products’ pricing when comparing them to your competition. The solution? The use of price monitoring tools.
According to Tim Ouimet, co-founder of Engage3, a company that provides dynamic pricing services, retailers tend to change prices more regularly during high inflation in order to protect their margins. High inflation demands price adjustments for each product and client category as well as market awareness, both of which can only be achieved with the aid of competitive pricing monitoring software. Especially when it comes to the protection of margins we recommend you use dynamic pricing.
Amazon Buy Box
Around 83% of all purchases made on Amazon happen through the Buy Box, which is visible on the right side of a product page with the options Add to Basket and Buy now.
In case you are selling your goods on Amazon too you know how hard it is to gain that Buy Box and how rewarding it would be to have it for each of your products. The good news is that thanks to dynamic pricing you can increase your chances of gaining it. Now that Amazon has compromised to introduce a second Buy Box for each product in Europe by the end of June 2023, it could help future retailers and brands to position themselves even better.
Price intelligence refers to the practice of collecting and analyzing data on competitor pricing strategies and market trends to inform a company’s own pricing decisions. By monitoring competitors’ prices, promotions, and discounts, as well as tracking changes in consumer demand and market conditions, e-merchants can gain valuable insights to adjust their pricing strategy and stay ahead of the competition.
It depends on the size and complexity of your business, as well as the level of competition in your industry. A price intelligence software can provide more accurate and timely insights and streamline the data collection process. It can be a valuable investment for businesses operating in highly competitive markets or with large product portfolios.
Competitor prices can be monitored through various methods such as manually visiting competitor websites and physical stores, subscribing to competitor newsletters, and conducting online searches. Another effective way is to use automated price monitoring tools and software that can track and analyze competitor prices and provide real-time updates.
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