How E-retailers can make a sustainable ‘price match promise’ to grow business while protecting margins
As recession continues to bite, forcing even well known and loved names into receivership, we all know it’s essential to keep customers buying from us. And, in order to achieve this, you have to be absolutely certain you are offering the best price around.
Of course in any market sector, there are many online retailers, all competing for the same customers and, more importantly, their money. To triumph in the face of such intense opposition you’re going to need an angle or edge; something to make sure you’re ahead of the competition and that allows you prove it too.
This is where services like Competitor Price Watch (CPW) can help. In this post I'll describe the concept behind these services and finish with three examples showing how it can be applied.
The CPW service reveals key opportunities and threats
The Competitor Price Watch system means that you can stay informed of every price change on a daily basis. The system even focuses attention on the most significant changes as they happen.
The system also identifies areas where you might not even realise there is an opportunity for growth. Whilst you obviously want to be sure you’re not pricing too high, a lot of people don’t ever consider they might be underselling products by a considerable margin.
CPW can give you all this information at the click of a button to include on your site or you can set up a daily targeted email.
Competitor Price Watch also enables you to feature a ‘price match promise’ box on your final product page. The box shows potential customers which of your matched competitors you beat on price – a simple on-site addition that has been proven to reduce cart abandonment.
It’s wise to leave competitors cheaper than you off the list!
A human approach generates more reliable results
Few companies in the current marketplace offer a similar service to CPW.
To the best of our knowledge, it's the only price match tool in existence that doesn’t use any kind of spidering or scraping software to find the products you are looking to match against.
In fact, we believe Competitor Price Watch is the only price matching service employing human matching at initial set up. So, when you present the list of products you want to match and the competing companies you want to monitor, it doesn’t just run a computer program over the internet, missing more than half the potential matches due to an absence of unique product codes or alternative descriptions.
Instead, CPW assigns up to 20 trained data miners to visit each company website in turn and, using the on-site search facilities, they search for each of your products one at a time.
This approach means even competing products described differently on other sites (to a computer, a black size 12 Gucci evening dress is totally different from a Gucci evening dress in black, size 12) are instantly identified. You don’t need a unique product code or to match an identical product! Just tell Competitor Price Watch you want to match generic versions of an item and you can track every own-brand competitor make competing with your products.
Human matching, combined with three layers of quality checks, is the only way to truly achieve the high rates of matched returns that allow you to trust the results.
Once the initial matching process is complete and verified, the computer takes over. Conducting daily page visits using masked identities to avoid being flagged and denied access, CPW records each price and compiles a summary price movement report, with email alerts on any fluctuations you need to be aware of.
This process means you can deal with any potential price problems within the first 10 minutes of your day, leaving you free to pursue more pressing matters, secure in the knowledge that your pricing is spot on.
The tough economic times we are living through mean the online market place is becoming an even more cut-throat environment, so you do need an edge.
Competitor Price Watch can give you the sharpest edge available.
CPW in action: three case examples
Case example 1: An international pharmaceutical company
In an industry as price sensitive as pharmaceutical, an international client needed the means to keep track of a huge range of products. In the current climate, not realising when competitors had actually increased their prices on a particular product can mean tens of thousands of pounds in lost revenue in no time.
It is no secret that online shoppers search for the best priced product, particularly when the product is identical and brand differentiation is difficult.
The key issues:
- Extremely high number of competitors and products to keep track of
- Reacting far too late to price changes
- Unable to keep track of competitors stock levels
The company imports CPW data directly in to their back end systems (another service CPW offers) and instantly knows when prices and stock levels change. And, its own data is now always up-to-date leading, they estimate, to extra annual profit to a seven figure order of magnitude.
Case example 2: A small audio retailer
Yet another price sensitive market place. The UK audio market is huge and it is extremely easy to price match 'like for like' products.
The client was struggling to keep up with the ‘big boys’ - the CPW solution now mostly does this for it. The key issues were:
- Typical 'one man' scenario trying to ‘do it all’
- Impossible to compete with larger stores with more staff
The company can now compete with much larger businesses and ensure he achieves the best profit possible.
Case example 3: Enormous UK baby goods store
Baby goods is another significant UK market. The client needed to track tens of thousands of products and hadn't realised a service like ours existed.
The key issues:
- Significant staff time dedicated to trying to keep up with competitors’ price changes
- Swimming against the tide meant, in fact, going backwards
- Unable to effectively track competitors’ stock levels
Getting the CPW system up and running freed up staff to do their 'proper' jobs, and the client had all the data it needed to ensure its pricing reacted to market movements.
The company now knows instantly when prices and stock levels change. Its own data is always current and it is much more capable of effortlessly tracking all its own product prices.