Today's market can be defined in just one word: competition. Regardless if it is online or offline, everyone is competing to get a higher ranking than the one they are in. And when we talk about business profit, pricing is the first thing that comes to our mind. Today, pricing is not just a number; it has become the foundation of the business. With the right pricing strategies, you can rule the market, while if you don't focus on your pricing strategy, then you can be one of the thousands of businesses in the market.
Pricing alone can determine the success or failure of a business. Consumers are more demanding and informed than ever before, there are thousands of products same as yours in just one tap. So when comparing products is so easy and convenient, everybody today compares products before making a purchasing decision to make sure the deal they are picking is value for money. This shift in buyers' behaviour has given control of the market to consumers and businesses, making it essential for businesses to adopt price comparison strategies and tools to make sure they survive in the market.
Strategizing the price comparison process allows businesses not just to price correctly but also helps them to stay competitive and make data-driven pricing decision that enhances customer satisfaction. Regardless of whether your business is e-commerce, retail, travel or services, building data-driven price comparison strategies can be the key for you to capture your targeted market share and improve profit margins.
Now you know the importance of creating a price comparison strategy, but you have no idea how you can build a correct price comparison strategy for your business. Well, in this article, we will see how you can make an effective price comparison strategy with a few simple steps.
Guide to Create a Price Comparison Strategy
Before we begin, it is essential to note that this guide is intended for businesses that are new to price comparison or the industry, and will provide a brief overview, while each step is more complex and in-depth than what will be discussed. So do gather full knowledge before implementing it to avoid any mishappening or potential loss.
Step 1: Identify Key Competitors
Knowing about your enemy is more important than building strategies to fight the battle.
The same thing happens in businesses; if you are clear about who you are competing with, then half of your work is done. But we need to understand that identification of competitors is easier said than done; there are many types of competitors, from direct competitors who you can compete openly to indirect competitors who steal your customers without your knowledge.
Then there come your present competitors who can change from time to time, these types of competitors are those businesses or firms which is at the same level as yours or a step higher, and you want to overtake their business.
Then there are main competitors, these types of competitors are the giants of your business, they can be a leading supplier of products you are dealing with or manufacturers of those goods too.
So identifying your competitor and which type of competitor they are is very important for a business to start with, to make an effective price comparison strategy.
Step 2: Choose the Right Products
If competitors are your enemy, then products must be your weapon on the battlefield. Knowing which product to boost can be a game-changer.
The easiest step to identify the right product is by checking the list of products which is giving you the most revenue, like your star product or best-seller, because there is a chance that these products have boomed the market or that your competitors also gain a lot of profit from these products.
These products can be the base of your price comparison strategy as you can compare different or all the factors of your product with your competitors' product, like price, quality, branding style, advertisement, etc.
Step 3: Select Tools or Services
There are countless platforms that provide price comparison services. These platforms do all the hard labour for you, from the collection of data to organizing it or cleaning it and sometimes convert the data into visual diagrams like pie charts or line charts for your quick and better understanding.
But why tools?
You must be thinking that you can collect and clean data manually, so why do you need a tool? Well, in this fast-changing world where prices are altered every hour in the market, a manual price comparison technique can't keep up with these fast-changing market dynamics.
Eventually, in a few years, every business needs to adopt the tools to automate the collection of data and labour-intensive processes, not to thrive but to survive, as no human will be able to match the fast-changing needs of the market. So, isn't it better that you adopt the tool to thrive before it becomes a necessity to survive?
Wanted to know more about the price comparison tool? Visit the Competitive Pricing tool.
Step 4: Set Frequency
As we all know that every sector needs change, but the changing time could be different for every sector. For example, a fashion industry trend changes in a few months; on the other hand, an event management industry decoration changes every season.
So understanding how much liberty your business is given you for the buffering time is very important to understand how often you need to alter your pricing strategy to stay up-to-date in the market. So that you can choose the right tool and plan your pricing strategy accordingly.
Setting frequency is like putting the cake batter in the oven and exactly know when the cake will be ready, understanding the right buffering time could be time consuming, especially if you didn't paid attention to it before or you are new business, but with experience you can understand the different burring time for your different product to make more accurate price comparison strategies.
Step 5: Analyze and Act
When you have the data and analyze your competitors' strategy, it's time to act. There could be multiple ways you can take an affection for taking first step towards your growing business.
The step could be as easy as changing product listings to stay competitive in the market, and marketing to create a foolproof pricing strategy for the year. In the initial steps, you could adopt a trial-and-error approach to see what works best for you, but once you analyze it, stick to the strategy until the market and trend demand otherwise.
Conclusion
You can't skip a chapter in life; that's not how it works.
Well same applies in business too, you can skip a step in business and expect the same outcome someone else has got. Adopting new tools and techniques is an inseparable part of any business, it's the change that gives businesses the opportunity to grow and dominate the market. A price comparison tool is what a business needs to understand and keep track of their competitors without investing too much time in it, so that they can focus on other things.
To know more about the price comparison technique and how it is changing the market, check out our Why Price Comparison article. This article has everything you should know about price comparison, from what price comparison is and how it evolved from the traditional technique to an AI-backed tool in a changing market.
