Sticky Prices: Why Ecommerce Dislike It?
Prisync | Dynamic Pricing
Pricing optimization & dynamic pricing SaaS for any size of ecommerce company to increase your sales growth & margins.
Hello from Prisync!??
Welcome to this week's newsletter.
Let's start with what ecommerce dislikes!
Supply and demand determine the price of a product, but sticky prices can damage your business in the dynamic ecommerce market.??
Price stickiness can be both downwards and upwards. For example, we see that our wages can increase, but they are highly unlikely to decrease. Wages have downward stickiness.??
Online customers understand for example, that the price of seasonal products may change throughout the year. Plus, ecommerce vendors have an advantage over brick-and-mortar stores. In online stores, prices can be changed with the click of a button.
That’s why online retailers have a better advantage when it comes to changing prices to scoop up some of the profits generated.
On the other hand, we can even assume that changing prices is not optional. Harvard Business School economist Alberto Cavallo published a research paper pointing out that the competitive pressure from Amazon forces a greater amount of price changes and more uniformity in prices across different locations.
If you are interested in the topic, continue reading from here!
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That's all for this week!??
You can always visit?the Prisync Blog to read more about #googleshopping, #shopify, #amazon, #ecommerce, and #pricingstrategies!
See you next week!??