Monitoring the prices of your competitors could mean the difference between acquiring new customers, as well as increasing your profits, and losing to your competitors. Below are reasons why you should be conducting competitor price monitoring:
- You could already be losing sales and not be aware of it if you don’t know how your prices are in relation to the prices of your competitors. It's vital to know if your products are priced lower or higher than theirs so you can make adjustments.
- You have to know how you could differentiate your business through your pricing or not. As with any business, most especially in eCommerce, an ideal business strategy is usually based on pricing. Determine what competitors charge and how they charge for their products. If you are planning on taking on similar businesses that have already established themselves in the same industry as yours, but they all seem to have similar prices and pricing models, you’ll have to know how they work so you could “sell” your business model to potential customers and look for means to distinguish your business from your competitors.
- You should also take a look at what your competitors are selling, which ones are most in-demand, and how they’re priced so you could evaluate your inventory and price them competitively. This is a vital component of competitor price monitoring, says an expert from PriceManager.
- You’ll learn that monitoring your competitors’ prices isn’t all about the price, but has to do with your product’s value as well. Nowadays, customers not only look at the price, but also the brand, user-friendliness, and credibility of the site, as well as extra features, specials, or promotions that you could offer such as free or same-day delivery. Basically, you’ll know how to offer your products in a way that appeals to consumers.
So, considering that it is becoming increasingly tough to sell products online without significantly considering the prices of your competitors, how do you figure out the most effective pricing model that’s a win-win for you and your customers? It all boils down to price monitoring — which you should start doing right now.