In today’s world competing in the market is as important as providing the good quality products to customers.
It doesn’t matter if you are providing the best quality.
It doesn’t matter that your services are fastest and most efficient.
What matters the most is your targeted audience is attracted to your brand. That they your brand exist and is not looming in shadow because of countless competitors.
So what should a business do today to reserve its position in market place.
Well the answer is very simple, observe what leading brands are doing and follow them, well not blindly.
If you observe, the top brands never fails to attract their customers. But ever wondered how?
Well, while adapting changes frequently.
You would never see Gucci selling same design in two seasons?
Why? Because they are competitive, they observe what customers are demanding and on that basis they create.
Well competitive price tracking works same, it helps you to understand what your targeted audience is demanding and at what price.
Never heard of competitive pricing before, but wanting to learn to boost your business? Well you landed on the right place. In this article will provide you everything you should know about competitive price tracking, from its uses to how to implement it.
After reading this article you will know everything you can about competitive price tracking, so you can reset your strategies and give your business new height.
Competitive price tracking is the process of monitoring and analyzing the prices of your competitors’ products to make practical pricing decisions. This ensures that your offerings are neither overpriced (risking customer loss) nor underpriced (cutting into profits unnecessarily).
In other words we can say that in competitive price tracking we observe and analyze the prices in the market before deciding our own price, so nether they higher than the market price which repels the potential client nor lower than market price which can affect the brand value in the market place.
Competitive price tracking includes lots of techniques, some of the are as follows :
Tracking competitor websites :- Leading companies always keeps an eye on their competitors while visiting their websites on regular basis and understand their price strategies.
Monitoring marketplaces :- Websites like Amazon, eBay, Walmart are platforms where everyone lists their product, which means these websites works as the digital market places from where you can get information of your competitors and you can analyze the market shift while monitoring these websites.
Scraping product listings :- Scraping the product lists about what your targeted audience is demanding can be a game changer for you as you can study the behavior of your customers.
Using AI or machine learning to generate pricing insights :- Take advantages of fast growing tech industry as AI and Machine Learning can save your lots of efforts and time, even using AI ensures there is no human errors in the predictions and analysis.
After understanding what is competitive pricing and what is included inside it, it is very important that why we should use competitive price tracking. Below are some important points for you, so you can understand why competitive price tracking is important
Being competitive is not just knowing what is happening in the market, but knowing it on the right time so that you can grab the opportunity when market offers it. And to achieve that you should get the data on real time about your market place. Which is possible with competitive price tracking, it can act like a secret agent keeping eyes for you on your competitors and customers.
Everything in this world works in patterns, day-night is a pattern, winter after rain is pattern and so is market. With real time data and market analysis you can understand the pricing patterns of the market. So you can make your pricing strategy on the basis of market condition and what phase will come after present phase.
Changing prices on timely basis can work like a charm for you. Implementing competitive pricing can increase your profit margins as you will be aware about the market conditions and seasonal changes in the market.
Raising your prices during the peak time of demand can helps you to make lots of profit as well as you can brightens your brand’s visibility in the market place with quality products and fast services.
Dynamic Pricing is the process of altering the prices of your product on the bases external factors or dynamics of the market. Implementing dynamic pricing make sure your brand value in the market is retained by setting right price at right time.
For deeper understanding on dynamic pricing check out our blog Change Your Price At Right Time With Dynamic Pricing
Repeat sales is like a backbone of any business, which means retaining customers are more important that engaging with new customers as these loyal customers are the source of your stable revenue for a business. You can attract customers as well as retain them with right prices.
Competitive Price Tracking started manually in the traditional market where there are people who collects information of their competitors with common retailers and mutual connection and then analyze that data to understand the pricing strategy of them. But like everything else, Price Tracking techniques also updated for manual collection and analyzation of data to automated tools for the same.
But like everything, there are some pros and cons regarding both the techniques, in some factors automated price tracking tools facilitates more than manual one on the other hand manual price tracking techniques have their own perks.
So in this topic we will look on both techniques and identify their advantages and disadvantages to understand which one you should apply.
In manual price tracking process is the process in which business collects the data of their competitors and market by themself, in which they can collect data by visiting to their websites and stores and compares their products prices and quality. This practices is still vastly used by small business but if your business is expanded enough then applying this technique can be impractical for you. But it does saves money of the business but this techniques charges you with time and sometime accuracy.
So if we summarize it in points, manual price tracking is :-
Now-a-days there are lots of platforms who provide Competitive Price Tracking services, some of the following platforms are as below :-
These websites provide automated price tracking services.
These platforms collects and retains data for your businesses and provide market analysis reports with visual representation for better understanding, they charges for their services. These services makes sure to provide you accurate and real-time data so that you can focus on more important things about your business. These services are must for a large business or those who wanted to expand their business, but during accessing service you need to invest money as well as time to understand the working of these platforms or you need to hire experts for them.
So in short we can say that automated price tracking provides :-
So if we compare manual competitive price tracking with automated price tracking, we can concluded that automated price tracking can be proved more helpful and beneficial for business as they provide accurate and efficient data which can easily surpasses the ability of a normal human. Most modern retailers and business are using competitive price tracking platform to maximize their profit and shrinks there changes loss.
There are countless price tracking platform these days, but not all of them are equal, some platforms lacks on there services and accuracy while others glow like sun on these fields. Every platform have there own unique features to attract clients which can confuse and overwhelm you about which one to use. But don’t worry, we are here for you with a list of all the essential features a competitive price tracking tool must have to provide you best outcome.
There are some felids where frequent price changes is not a thing, but most of the fields changes prices daily some even do hourly, from fashion industry to food or just real-estate everyone is waiting for the right time to increase their profit. Having a price tracking tool which provides you data on real time and alerts you every-time it notices a drastic change in your marketplace can proved to be an trump card on the table.
With our price tracking tool you can customize your price update time and in addition you will be notified through website notifications and email about the market/trend shift.
E-Commerce brings us the opportunity to sell globally our products, but with opportunities it also dragged us to the global competition. Where we need to compete with not just some venders of our market but with everyone who is in the market, regardless they are a small business or an MNC. So when business have to race with so many levels to grow, their price tracking systems should also multi-channel tracking. Multi-channel tracking is when a user can compare prices from different websites like Amazon, Walmart or some local competitors, simultaneously.
With Prodfinity you can track as competitors as you want with any website at the same time, on same place making analysis more convenient and organized.
Having historical data of your market or competitor can help you to understand their working patterns and pricing strategies which can be very useful for you. Price tracking platform which doesn’t provide service of historical data and analysis is not letting their client grow to their full potential. Choosing a platform which is not committed to their legit services isn’t really committed to make your business grow either.
We just don’t enhance present, we also remember so you will not repeat the same mistake.
With Prodfinity Price Monitoring Tool you can see the historical data of your competitors as well as you can analyze your own performance with historical records and analysis we retained for you.
Analyzing the market and your competitor is not enough, you should also make changes accordingly. But it could be tiring if you have to change your countless product prices multiple times in a day, and it will be very hard to catch up with market. Having a price tracking tool which can accurately makes changes on your product prices during market shift can take lot of work and stress off your shoulders. In addition to that, price alteration will be based on AI algorithms which analyzed the market condition and make changes accordingly.
All our clients can alter their prices instantly according to market demand and change in trends with Prodfinity Dynamic Pricing Tool, so that they can concentrate on more important things in for your business.
We even provide two options in it,
Dynamic Pricing Tool : Changes the price of your products based on the dynamics of the market to make it more responsive and maximize profit margin.
Semi-Dynamic Pricing Tool : If client don’t want to give whole control of their product prices to our tool they can choose semi-dynamic pricing tool where through Machine Learning and Price Intelligence based algorithm suggests the right prices for your product, from which you can set the prices.
So now after learning about the essential features of price tracking tool, I hope you will be able to choose a better tool which will help you to boost your business in way too many ways.
That you know everything about competitive price tracking and its use cases, now is the right time for you to know types of competitive pricing strategies so you can decide which strategy you should implement for best results.
In this technique you makes sure that your prices are always lower than your competitors so that you can attract large number of customers who wanted to avail the product but with a bit cheaper rate. This techniques works well on the products which are consumed on daily bases like groceries, fruits and vegetables.
In this, business sells a product in loss just to attract customers to website to increase traffic as well as to lure them with their best products which have greater profit margin. This technique can work like a charm with complementary goods like selling sugar on less price but also offering premium chocolates.
Do you know luxury brands like Gucci, destroy their unsold good, than selling them in lower rates. Why do they do this?
The answer is very simple, they go to such extreme length to retain their brand value and exclusivity. So if you wanted to be a luxury brand you have to start making it with starting and regardless of your competitors you should not reduce your prices frequently to provide an impression of quality and premium-ness.
Price matching is the way where you sets your prices same as your competitors but attracts your customers with some extra perks likes free shipping charges or discount coupons to retain them for future. This strategy is useful where customers can lean towards your competitors with just minimal difference in prices, industries like fashion industry.
No matter how much to study about swimming, you will actually learn about it when you step into the pool. Same thing happens in business, knowledge is useless until and unless you know its implementation.
So now we are going to break down the implementation of Competitive Price Tracking into simple steps so you can implement it and work with us,
Step 1 : Identify your key competitors
Knowing with whom you are going to fight is more important than stepping into the battlefield.
In this step you should identify your biggest competitors who are the leading brands or businesses in your fields and list 5-10 of those businesses.
In additional to that you should also identify 5-10 of your present competitors, business which are closest to you with competition.
Step 2 : Select Right Competitive Price Tracking Tool
Selection of right price tracking tool for you can depend on multiple factors like your field of business, budget, features which you wanted the most and many more. Connect with different platforms and understand what they are providing before getting making a decision.
Prodfinity also provide Price Tracking Services, you can contact us for more details.
Step 3 : Decide Your KPI
KPI stands for Key Performance Indicator, business define there KPIs like what they wanted to achieve right now, like a business wanted to increase sales even while selling the products in lower price to gain market shares on the other hand a business wanted to increase their profit margin to work on expansion. Similarly you need to set KPI for your business to understand what really you want to achieve.
Step 4 : Analyze Data and Adjust Pricing
After purchasing the tool and setting your goals, next step is to analyze your marketplace and set the prices accordingly to achieve your goals as soon as possible.
Step 5 : Monitor and Optimize Frequently
You should monitor your market places and changes in trends frequently so that you can optimize your competitive pricing rules to get the best results from the tool and increase your potential effortlessly,
Everything we do, looks easy at the start and when you dives deeper into it, you can see lots of nets and traps you so desperately wanted to escape but have no ideas about it. Well yes, in other words I am talking about the challenges and roadblock which can show up in your path while starting or running the business. But you don’t have to worry about, I brought you the list of some of the common challenges with easy solutions.
If you are new to competitive price tracking and market analysis, you can make silly mistakes which can make your data inaccurate and affects on the analysis of the market conditions and situations. But these human errors are inevitable as we are prone to make mistakes especially when it is something relating to figures and analysis.
Solution
So what is the remedy of this problem, there are two effective ways to deal with lack of accuracy.
One is to hire an expert who can collect data for you and analyze it.
Another one is to get an price monitoring tool, as no human can replace machine accuracy.
Searching for price tracking tool, check our services here.
Stepping inside the market’s battlefield to compete but it is already crowded and you get overwhelm with the number of competitors you have. Keeping eyes on so many business and tracking their activity is whole-sum a job which can distract you from the primary work of the business.
Solution
The solution of this big problem is very small, you don’t to track every competitor of yours in the market place, just choose the 5-10 leading businesses of your fields and your close competitors and track their activity to understand their patterns.
Choosing right competitors to track is the smart strategy rather than analyzing activities off every business in your field, leading you to extreme and unorganized workload.
Change is the only constant in this world and even in the market place. And today they changes is very frequent due easy access to information and comparison, no business wanted to lose even a single customer due to wrong prices or strategy. But keeping up with changes of the market place can be hectic and stressful, especially when you are working on a field where price fluctuates multiple time a day.
Solution
The solution of this problem is using dynamic repricing tool, to make sure you are never inactive during a market shift.
Dynamic repricing tool alters the prices of your products on the basis of your competitor’s changed prices, while you can also set the boundation rules to make sure your prices aren’t too low.
Check out our Change Your Price At Right Time With Dynamic Pricing article for more detailed information about Dynamic pricing.
While dynamic pricing is an effective way to increase your profits and keep the smooth flow during the low face, but if you over used it, it can diminish your brand value as well as can increase customer dissatisfaction with frequent changes in the prices. So to survive the market you need to find the correct balance between market fluctuations and effective use of dynamic pricing tool.
Solution
Find balance is easy said than done, it can take years of experience and lots of trial and error phases to find the right balance. But with the help of AI based dynamic pricing tools you can achieve it by setting right rules so that your product price fluctuation is more stable than others which can attract lot of customers.
To try our Dynamic Pricing Tool, contact us.
Competing on price alone is a race to the bottom.
Words from Jeff Bezos reflects the amount of experience he had to be this successful, but it also taught us the lesson of not to be dependent just on prices to gain the customers as it can lead you to huge losses.
Solution
With prices, you should also provide few more perks to attract customer, either it is the quality guarantee or the discount on the combo or just make sure your brand and services talks on your behalf, so that customers buys your product even when they are hire than your competitors.
In this digital era, keeping your information to yourself is as hard as find a needle from the stack of hay. But there few websites which requests privacy protection for their sites and information, and if business invaded their privacy they can be found guilty on legal as well as ethical parameters.
Solution
To avoid been legal and ethical defaulter, you should respect the privacy of the websites by going through its terms and conditions page as well as can access their API services if they launched it to legally access their prices and data.
MAP Violation is the act of advertising the price of a product lower than the company’s MAP Price Policy which can lead to the legal risks as well as price wars state in the market place. Price war happens when retailers happens to compete on the basis of price of the same product in the market place to attract customers. This can leads to diminishing brand value as well as cuts the profit margin of the retailers.
Solution
The best way to avoid such situations,
By Businesses : Businesses can avoid such situations by creating MAP Price Policies which can protect their brand value in the market as well as increases the stability of their place in competition.
By Retailers : Retailers can make sure they do not violate the MAP Price Policy of the company to protect their profit margin as well as harmony in market place.
Constant changes in the market places, there are also alteration in the techniques on how market should run and also shift from one technology to another. Below are some assumption about the modification in the competitive pricing market in future.
1. Adaptation of AI & ML : AI/ML is working everywhere today and in future it will also conquer the gaps it left right now. And when AI/ML comes in competitive pricing market, it can increase the scale of market analysis as well as it can also provide better and more accurate price prediction and strategy.
2. Personalized Pricing : These days everyone wanted customized thing, from dresses to services and so they wanted to pay accordingly, so in future there are chances of customers getting the freedom to customize their service packages and pay accordingly.
3. Transparency backed by Blockchain : In future there can be more use of blockchain to reduce the tampering of pricing data and patterns or we can say that it secures the data.
So if we summarize the article, we can say that in todays fast-changing market, implementing competitive price tracking became more than just a facility, it became a necessity to survive in the market and scale eventually.
But we should not overuse anything and same goes with price tracking also, analyzing your competitor is important but if you don’t alter your strategies accordingly then all the information is useless.
Hence, a fast growing business is the one which saw it coming before it happened and adapt before it can fast it. So understand, adapt and scale to your will.
Click here, if you wanted to have a free trial of one of the most efficient Price Optimization tool, and start growing with us.
