Making a business decision, particularly on the prices of the products you offer for retail, should be based on factual information which has been painstakingly collated and analyzed. These include consumer sentiment and competitors’ price.
The retailing industry may be a profitable enterprise, but it can also be a cutthroat business that can quickly overwhelm you. This applies in particular if you are offering fast-selling products to the consumer market. Often, other retailers will also offer the same products at the same price and in some cases, similar products at a lower price.
In order for you to remain competitive, the products you offer must have a price that closely matches that of your competitors’. At the same time, the price must continue to be attractive in the eyes of your competitors. How do you do this?
Quality And Price
According to the World Advertising Research Center, many customers would often go for products with superior quality despite its high price. This consumer behavior is anchored on the premise that superior quality products would last longer than similar products with lower quality and price.
When durability and ability to last for a long time is used as measures of comparison, the higher priced product becomes cheaper. But when two products have the same quality, with one priced higher than the other, which do you think will the customer choose? In this case, knowing the price of your competitors would be a very big help indeed.
Competitor Price Tracking
The old method of monitoring the prices of competitors may have involved sending somebody over to competitor’s shop and check on similar products. Though there is no actual record of such events, it is possible, albeit unethical, dangerous, and too laborious at the same time.
The easier way of doing this was to monitor competitors prices using available technology. Before you get any ideas, this does not involve sending invisible drones, or some other alien technology, to take photos of their prices. The state-of-the-art application helps you track your competitors’ prices, product offerings, as well as consumer perceptions.
One of the great features of using software to monitor the prices of your competitors is that it can track prices 24/7. The software also alerts you if there are any changes in the prices of your competitors, as well as any trends regarding such product.
Bear in mind that the more information you have about your competitors, the better it is for you. In fact, Entrepreneur.com stated in one of its published articles that knowing where your competitors are located, what they sell at what price are all vital. This information provides you with an efficient way of tracking actionable data for you to come up with an appropriate response.
Any decision you make with regards to the pricing of your product should not be based on a whim. It must be anchored deeply on the information you have with regards to market sentiment and your competitors’ pricing and offerings. When you have well-researched and actionable data, you will be able to make a competitive analysis on how to proceed with your pricing strategy.