Smart Pricing: Competing Without Racing To The Bottom

Hello from Prisync! ??

The new edition of the Weekly Pricing Newsletter is filled with amazing insights for online retailers like you. ??

Pricing isn’t just about setting numbers arbitrarily. If you want to be successful in your pricing strategy, you need to consider all the different ways you can use pricing to your competitive advantage. In this edition, we will take a look at two crucial concepts: Smart Pricing and the Six Pillars of a Powerful Pricing Strategy—helping you understand the complexities of pricing.

Smart pricing is a strategy where you set dynamic pricing rules based on changing market conditions. It includes monitoring competitor prices and frequently adjusting prices against competitors to offer competitive deals while protecting your profit margins.

Read more over here!

6 Pillars of a Powerful Pricing Strategy

Profitable pricing begins with identifying your target customers and the value you deliver to your customers, then setting the right prices accordingly. A strong pricing strategy is critical to increase your profitability.?Let's glimpse at these six pillars of pricing strategies to help you figure out:

1. Define Market Positioning

Positioning explains why your product is unique compared to your competitors.?These are the questions you need to ask yourself to clarify your market position in ecommerce:

• Are you meeting customers’ needs?
• Have you determined?customers’ willingness to pay?
• Do your customers view your products regularly?
• Do your products provide quality aligned with your positioning?

2. Establish the Value

You establish the value by pricing your products based on customers’ willingness to pay. You can create your products’ worth just as much as your customers are ready to buy at the maximum level.

3. Determine Demand

In simple terms, if you increase prices, demand will decline. If the price is lower, the demand will increase. But before that, ask yourself these questions:

• What is the market demand for our most-selling products?
• What are the drivers behind demand?
• Did our conversion rate and traffic are affected by the latest price change?
• What is the market demand to be achieved at each?price point?we are offering?

4. Track Competitors’ Price

You can track your competitors’ price changes without wasting time and effort. It can be a game changer in the competitive ecommerce landscape. Competitor data can give you a great idea of how to proceed with your powerful pricing strategy.

5. Calculate the Price Sensitivity

The degree to which price affects customers’ purchasing behavior is called “price sensitivity.” Low price sensitivity means a price change has a relatively small effect on your pricing. On the other hand, high sensitivity means that a price change significantly affects your pricing. ?

6. Test Your Pricing Strategy

The last pillar you should consider is to test your strategy. Because ecommerce is a dynamic market where you see many new changes every minute, more research can be required. Your teams’ market research, competitor monitoring, and observations on customer behavior can be a great way to identify market trends.

Remember to follow these pillars and read more over here!

Weekly Ecommerce News in 5 Minutes!??

• Abracadabra! Building Lady Gaga's magical storefront experience on Hydrogen
• Google Shopping results: price at checkout label
• E-Commerce and social selling reshape beauty shopping
• Harris Poll report: What's now and what's next in online shopping
• The NRF released it's yearly St. Patrick's Day consumer survey
• Google Shopping gets smarter with a suite of AI tools
• 6 research findings that prove 1st-party data is reshaping personalized shopping
• What 5 charts say about the pandemic’s impact on retail, 5 years later

That's all for this time!??

You can always visit?the Prisync Blog to read more about #pricing, #googleshopping, #shopify, #amazon, #ecommerce, and more!

See you next week!??