How you manage your online product prices will determine the success or failure of your Internet retailing business. Finding out what is the ?right price? for your product will keep your prices competitive and avoid online shoppers going elsewhere.
Despite all the turmoil in the market right now with every business chasing more euros from the customer, many online sellers are struggling to manage pricing for their product lines in an efficient manner.
Here are five scenarios where you need to pay close attention to avoid losing out on Internet sales and to increase your profit margins:
1. If your prices are too high compared to the competition, your customers will go elsewhere.
You need to highlight where your prices are higher than your competitors.You want to ensure that you don?t have too high prices or incorrect pricing on your products, which will drive shoppers and search engine traffic elsewhere to find lower prices. By monitoring your competition pricing closely, you will have the competitive pricing advantage and you will be able to lower your prices instantly when your competitors lower their pricing; this will help you to increase your sales straight away.
2. If your prices are too low compared to your competitors, you are lowering your profit margins.
You also need to flag where your prices are lower than your competitors. In some cases, you might actually be charging a lot less for a product than the competition - this needs to be rectified as a matter of urgency. Your competitors might even be out of stock on this product. When you see such cases, you really need to raise your price while still offering a competitive price to your customer; this will help you to grow your profit margins immediately.
3. If your competitor is out of stock, you are presented with the perfect opportunity to increase your sales.
Having an efficient competitor pricing strategy offers you information about the stock availability of your competitors? products; this will enable you to check the competition daily as often as you want and find out where you have the upper hand in the market for that particular time. When alerted to the competitors being out of stock on a product, you can increase your price to grow your profit margins.
4. Offer competitively-priced niche products to entice new customers to your business.
Having a high-quality competitively priced niche product will tempt a new target market to spend at your online business. You might already have some products in your categories that would appeal to such audiences so you can market these products better with lower prices. By checking what the competitor prices with your competitor analysis application, you will be able to offer a better price for such products to consumers.
5.What?s the right price to charge for high-quality products?
If you have a quality product and you know what your online competitors are doing with regards to pricing of a similar product, you can sell fewer items to your customers while offering a high-quality service to keep them coming back for more. The alternative is offering a lower price but being unable to provide the same high-quality service - leading to unhappy customers. Think about your company image and the potential for future sales when deciding if this strategy is right for you.
Based in Mediacube, IADT in Dublin, Profitero is a next-generation pricing intelligence service for retailers and manufacturers. We help our global clients increase sales and maximise profits by leveraging high-quality online competitive data at scale.
For more information, visit:
www.profitero.com | blog.profitero.com | twitter.com/profitero | youtube:profiterocom
Source: http://www.irishpressreleases.ie/2012/10/24/5-ways-to-keep-your-online-prices-competitive-profitero/
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