Competitor price monitoring
The pricing policy next to SEO is one of the basic and crucial pillars of e-commerce. Thanks to control and price modification the biggest and the most competitive companies are ahead of competitors. They also have the most attractive offer that tempts clients. As a direct result, the volume of sales and profit is rewarding. What is price monitoring? Who should use it? Why do companies use price monitoring? The answers to those and a few other questions are a ruling subject of this article.
Who should use price monitoring?
E-commerce stores as online markets base their policy on marketing activities, mainly the price differences. When it comes to standardized products, the price modification is done by margin modification. The margin (equal or similar to all entrepreneurs) is the amount added to the brand’s selling price being the final price of a product. Decreasing the margin too much may negatively impact a company’s financial situation. Often, to get the leading position it is enough to decrease the price by a few Polish Pences. But to get essential information it is necessary to control the competitor’s actions and analyze them and compare them to one’s actions.
Producers and brands are other groups that benefit from using monitoring tools because those tools allow companies to observe prices and actions taken by competition. As a result, it directly influences the financial situation of the production company.
Thanks to price monitoring, companies can spot too intense price wars between individual retailers using aggressive and radical margins. This results in pressure on producers and they also decrease their margins. It is very unfavorable for the producer’s financial situation.
The second phenomenon that is worth monitoring with available tools is the legality of the product’s origin in circulation. It allows companies to detect and eliminate products that come from illegal sources such as fake goods imported from China or Taiwan that are sold at underestimated prices.
How does price monitoring work?
The price monitoring works similarly to crawlers (a robot) used by Google to index websites and optimize search results. The algorithm scans the competitor’s websites gathering information about prices, product offerings, availability.
Those actions are blocked in various ways thus producers of software to analyze competitor’s offers are constantly searching for new solutions and ways to omit the protections.
The most popular tools to monitor the competitor’s actions are myBrand 360 or Dealavo. The data gathered by crawlers is complemented by the information available via API dedicated to the Ceneo comparison engine.