Brands and retailers face many obstacles when forming a pricing strategy. Often, they are so focused on looking at their own images and internal goals that they forget to keep an eye on competitors.
But there are many advantages when it comes to identifying and using competitor data. Staying aware of other brands’ movements is crucial to forming a successful and competitive pricing strategy.
Why Is It Important to Monitor Competitor Prices?
Competitor price monitoring can help to eliminate guesswork when making your own price decisions. There is no need to wonder at competitor prices or whether there have been any recent price changes to products similar to yours.
With this kind of information, your team can make well-informed decisions which should help to maximize profits and improve your overall performance.
On top of this, staying aware of what other companies are doing can aid your own brand in finding its place in the market and building up its image.
How to Gather Competitor Data
Competitor price monitoring doesn’t have to be a manual process anymore, especially with price monitoring software on the market that can be shaped to fit your business. Some software offers multiple types of pricing intelligence, such as:
- Price monitoring
- Seasonal price differences
- Customer demand
- Competitor sales & promotions
- Product availability
Being able to automate this data collection in close to real time prevents your business from relying on irrelevant or unusable data. There is a lower risk of human error or out-of-date information.
Price monitoring software offers reliable and consistent access to your competitors’ pricing information, making it one of the easiest ways to gather competitor data.
What to Do with the Data
Of course, all this in-depth pricing data can be overwhelming unless you know how to use it. Importantly, every bit of insight you get from your price intelligence software can prove to be paramount when making pricing decisions. Here are a few ways for you to optimally use your competitor’s pricing information.
Find Out Who Is Actually Affecting Your Sales
You have primary and secondary competitors, and knowing which ones are directly affecting your sales is a great first step.
Using competitor intelligence tools, you can find out what products are being sold alongside yours, which brands are making more sales on those products, and for what price the items are being sold.
It’s also smart to keep tabs on any new products entering the market so you can be aware of possible future threats and stay ahead of the game.
With this information, find out what other brands are the biggest competition to your business so you can formulate a pricing and branding strategy that accounts for their movements.
Price Dynamically & Competitively
Now that you know who your direct competitors are and how they price, you can plan your own assortment accordingly to stay competitive. However, prices never remain static for long. Your competitive pricing strategy has to accommodate for changes in the market.
You can monitor these market fluctuations with pricing intelligence tools. Everything from repricing, to sales and promotions, to seasonal demand affecting price will be noted and can then be strategized for.
Luckily, there are also repricing engines out there that can help take care of this for you.
This software changes your prices to remain competitive and can even set price minimums and maximums to ensure you stay within a profitable price range for your brand. It’s also particularly useful for eCommerce, as prices on your websites can be updated automatically to stay current with trends.
On top of this, you can use competitor pricing information when introducing your own new products into the marketplace. Look into similar products being sold and use these prices as a benchmark for setting your own.
Being fluid and pricing dynamically is key when trying to stay competitive in the retail world.
Find Your Niche
With all the information you have gathered from your competitors, one of the next steps for you to take is finding where your brand fits into the market.
Are your products bringing anything new to the retail world? Are there any gaps being left by other businesses that you can fill? Why should customers buy your products over any other brands?
This type of niche building should focus on both your products and your brand image. The majority of customers look into a brand’s website if they are shopping online or are greatly influenced by packaging if they are shopping at in-store retailers. Does your marketing stand out from the crowd and emphasize the value you provide?
If a customer is at the shelf looking at products and your branding—and niche—is on full display, you’re that much closer to winning the sale over the competition.
Investing in automated pricing information tools, whether basic intelligence or advanced repricing, is a must for any brand or retailer looking to remain competitive. Are you making successful choices for your business?