Shoppers tired of holiday traffic will become increasingly comfortable buying higher priced merchandise online – and more of it.
Ottawa, Canada – September 8, 2014 — Who will win the title of “Priced Right to Win” during the 2014 holiday shopping season? According to 360pi, the leading provider of competitive price intelligence, and retail industry analyst Paula Rosenblum of Retail Systems Research, it will be the retailers that know the purpose of every price change and those that have a clear view of the competitive pricing landscape.
“Because of today’s hyper-competitive retail environment, brick and mortar retailers will have to work twice as hard to secure e-commerce traffic and transactions. This means players like Staples, Best Buy and Walmart will need to quickly build out their digital capabilities and identify the best pricing strategies to have a successful season,” said Jenn Markey, 360pi vice president of marketing.
As reported in 360pi’s 2013 Amazon Holiday Insights report and highlighted in a recent webinar, the retailers who “won” in 2013 were those that offered meaningful discounts on a sizable number of products on Black Friday instead of discounting a small number of door crashers. Poor financial performance followed those retailers who discounted during the week leading into Black Friday, and those who kept discounts in place following Cyber Mondaygenerally fared better than those who raised prices.
How can retailers have a winning holiday season? According to 360pi and Retail Systems Research, retailers should pay heed to the following pricing tips:
Paula Rosenblum, managing partner, Retail Systems Research:
- While consumers expect consistent prices across channels, “channel-specific” promotions are a winning behavior.
- Keep up with competitors’ prices as best you can, but use data for decision-making. Try not to be knee-jerk.
- If you haven’t already, take a look back at last year and set your forecasts for this year. Continue to monitor results (and deviations from what you expected.) Adjust prices and plans accordingly.
- Remember, in a race to the bottom, no one wins. Keep prices sharp and differentiate on service and convenience.
Jenn Markey, vice president of marketing, 360pi
- Do not raise your Black Friday prices through the weekend and beyond.
- Amazon is under increasing pressure to improve margins – this is a real opportunity for retailers.
- Sell local by taking advantage of zone pricing strategies.
- Know thy competitor – look for time-of week and time of day patterns to exploit.
“Right now, we are seeing a culmination of several pricing strategies heading into the fall and holiday seasons including narrowing price target ranges due to consumer price transparency, escalating price dynamism, the closing price gap with Amazon as well as escalating trends in zone pricing and pricing for time-of-day and day-of-week,” said Markey. “The formula is rather simple, the retailers who can successfully implement these strategies and avoid the price war fallout, will prosper.”
360pi derives profitable insights from product and pricing big data to help leading omnichannel retailers, etailers, and manufacturers compete and win in a price transparent world. 360pi’s customer base accounts for over $US100 billion in annual retail sales and includes Ace Hardware, Build.com, Overstock.com, and RIS Fusion award-winner Best Buy Canada. 360pi monitors millions of products with unprecedented accuracy to give retailers and manufacturers real-time visibility into the market with full awareness of the competitive pricing landscape to “right price” for their respective customers. Ultimately, 360pi helps customers make smarter pricing decisions to drive increased revenues and margins.