Pricing is a very critical point for both online retailers and shoppers. Since the global economy is living in uncertain times, which means the economy is unstable and the money starts to lose its power, shoppers have become more price sensitive, which requires more effort for retailers to adopt their pricing strategies.
Let’s break down steps you can take to build your pricing strategy for uncertain times.
The primary step to building a pricing strategy is to track and identify new trends in e-commerce. You can start by researching the popular items you are selling in the market. And also, looking out at your competitors’ listings is an excellent way to identify essential items.
Identifying new trends is essential because price sensitivities are permanently heightened, and recent Key Value Items(KVI) emerge daily. Today’s data-driven analytics and modeling can move rapidly to make sense of channel, price sensitivity, and product mix changes.
That’s why you need to keep track of new trends in e-commerce to help you identify your valuable items. This practice can guide you to which products you should develop pricing for uncertain times.
Since e-commerce is growing rapidly, online shoppers’ expectations are increasing daily. They are looking for the best service and want to get the best deal possible. What retailers can do is they can observe shopper behaviors backed by data in various channels, and it can give you a clearer picture of at which time of the day customers are willing to shop.
Retailers can also offer deals or coupons to understand customer reactions to price changes. Some customers might be more willing to buy products since prices can increase tomorrow in uncertain times. After finding the best price for your customers, which is the price point they are happy to buy, you can align your customer’s needs with your business goals.
You can ask yourself, what is the optimal price to make my customers happy and help me increase my sales? After working on this, you can find that price testing is the best strategy to find that optimal price.
Do you know your significant competitors’ current prices? How frequently do you track their prices? Competitors’ listings have a significant influence on online shoppers. Just like we’ve explained above, customers are becoming more price sensitive. For that reason, offering the best deal might be what they are looking for.
You can use automatic price tracking software to keep track of your competitor’s prices. You can get automatic alerts when they change their prices, and then you can change your price if necessary. Price tracking tools are excellent for applying dynamic or competitive pricing strategies.
Did you know that automatic pricing tools give you smart price suggestions? Automated pricing tools work 24/7 to ingest vast market and competitor data. The way to generate smart price suggestions is that they focus on competitors’ prices and dynamic pricing algorithms.
You can see suggestions weighted by priority, allowing them to allocate the most significant potential impact on your pricing. You don’t necessarily have to offer the suggested price, but it can give you some ideas on pricing if you need clarification while tracking vast amounts of price data.
The last step is to continue testing your pricing strategy, reprice your products, and observe shoppers’ behaviors toward price changes. This is a crucial step to understanding whether your pricing strategy works effectively.
Keep tracking your competitors’ pricing, market trends, and shoppers’ needs, and ensure your pricing is aligned with your goals. Price testing should be addressed since it can guide you if you need to change your strategy.
The trickiest part in pricing for uncertain times is that retailers fear increasing prices. But if you follow the steps above, you will realize that your competitors are rapidly changing their prices. You can find the best pricing strategy for your products in those critical times to help you save your profit margins.