7 things you can change instantly thanks to price monitoring
- 12 June 2020
Price monitoring is known to be a long-term process that brings many benefits to both brands and online stores. However, not everyone knows that shortly after its implementation you can make changes that will immediately increase your revenue.
What can you improve as soon as you start monitoring prices?
1. Instant price increase to protect margins
Many e-shops have attractive offers from the consumer’s point of view but not when you’re looking at the margins. For example, when the difference between the lowest and the second-lowest price on the market (or price comparison website) is, let’s say, EUR 100, the cheaper seller loses a large part of the potential margin. Then, just after detecting such a situation, they can easily raise the price without losing their position as the cheapest seller, while increasing the profit. In this way, record-holders using the Dealavo platform received an additional EUR 700 in one day!
Raising prices is also a way to have consumers’ trust. In the face of COVID-19, many new stores have appeared on the market and are trying to convince the customer to purchase at a very low price. However, this does not look reliable, because extremely advantageous offers combined with no reviews are suspicious, which results in the low level of sales. For such sellers, Dealavo has prepared the Counter Price tool, which allows you to efficiently get information about competitors’ prices, and then tailor your offer to them and build a credible image. In contrast, to stores that would like to further improve the price optimization process, we offer a more advanced Dynamic Pricing tool that implements its automation based not only on competition data but also internal information or behavioral data.
2. Lowering the price to become a leader
Monitoring allows you to get information on all current competitive prices. Then it may turn out that to achieve the position of a leader in the price ranking, it is enough to reduce the price by just EUR 0.50 or EUR 1. This will not significantly affect the margin, and the first position in price comparison websites can contribute to a significant increase in sales. In the Dealavo platform, thanks to a special feature, you can see such possibilities in a few seconds.
3. Verification of trade terms
Price monitoring allows sellers to verify whether the commercial conditions offered to them by brands are adequate to the situation on the market. How? Dealavo provides the option of setting e-mail alerts that notify you when the crawlers find prices online that are lower than your purchase price (the mechanism of this is explained in more detail in this article). That way you can instantly know that you were not presented with a favorable offer, and use this knowledge to renegotiate the contract.
4. Verification of sales channels
Using price monitoring also helps optimize online sales by choosing the right channels. For example, if the seller is not present on a given platform, and price monitoring shows that, at their price level, it is profitable to display the product there, they may decide to enter such channel (e.g. Amazon). Creating an offer on Google Shopping takes only a few minutes, and the presence in the additional platform will bring additional profit.
5. Review of assortment differences
Thanks to price monitoring, online stores can quickly check the online assortment of competitors, their promotions, and detect out-of-stocks. The knowledge gained is a chance to quickly optimize the offer by raising the price of the product temporarily unavailable in other shops or by introducing an additional promotion.
6. Promotion verification by the brand
Monitoring promotions, including banners, allows brands to check whether the store complies with the agreed conditions of the promotional campaign, i.e. whether its form, mechanism of action, and duration are following the terms in the contract. If any issues are found, the brand may immediately contact the seller with a request to fix the problem or to renegotiate the terms of the contract.
7. Replenishment of the stock by the producer
E-commerce monitoring also allows the producer to quickly respond to their products selling out at retailers by proactively proposing them new stock. This increases the chance of additional sales because the store does not always detect empty shelves immediately or simply cannot keep up with replenishment.
If you would like to learn more about price and promo monitoring and find out how it can support the development of your business, please contact us. Our experts will show you the best ways to use Dealavo, which will help you take quick and effective steps to maximize profit.