In this article, you will find tips on how to use price tracking software in the Pharmaceutical industry. You will find insights for online shops which want to stay competitive in this market.
We will cover the following topics:
- What are the characteristics of the pharmaceutical industry?
- What are the challenges related to price monitoring and dynamic pricing (repricing)?
- Which functionalities and reports provided in the price tracking tool are crucial?
- How to start monitoring prices systematically?
1. What are the characteristics of the pharmaceutical market?
The pharmaceutical industry is responsible for the:
- distribution of medications.
What is characteristic of this market?
- The pharma market is growing steadily. In 2019, the global pharmaceutical market was valued at about 1.25 trillion U.S. dollars and noted an increase by 3.7% in comparison to 2018:
- The e-commerce pharma market is expected to grow at a significantly faster pace. According to the Data Bridge Market Research, the growth would be of 21.30% CAGR in the forecast period 2020-2027.
- The age group for which shopping online for medicine or dietary supplements is most popular are 35-44 years old. 18% of respondents in this age group purchased pharmaceutical products online in the UK.
- Advertising of pharmaceutical products is limited – in some countries, certain products cannot be advertised at all. Different platforms, such as Google, define pharma products advertising regulations in their regulations.
- In many countries, the promotion of online pharmacies is restricted. Online pharmacies may only be promoted in Google in Australia, Austria, Brazil, Canada, Chine, Czech Republic, Denmark, Germany, Hong Kong, Japan, Mexico, Netherlands, New Zealand, Norway, Portugal, Slovakia, Sweden, Taiwan, United Kingdom, and the United States. In other countries, online pharmacies can’t be promoted on Google Ads.
- In some countries, online pharmacies can be promoted, but prescription drugs cannot. Thus, there is a smaller list of countries where promotion and targeting prescription drug keywords is allowed. These countries are Australia, Austria, Canada, Czechia, Denmark, Germany, New Zealand, Netherlands, Norway, Portugal, Slovakia, United Kingdom, and the United States.
- The trend is that people are currently focusing more on their medical and health needs – to a big extent because of the anxiety caused by COVID-19. 64% declare that it caused them to pay more attention to their medical needs.
- The market is very dynamic when it comes to prices – they tend to change very often and online pharmacies often fight for every penny.
- Because of the advanced research and development in the pharma industry, there are launches of new drugs regularly. That’s why it’s crucial for online pharmacies to monitor the assortment of their competitors to make sure they don’t miss any relevant drug in their offer. For this purpose, Dealavo customers can order the Competitor’s Assortment Report.
2. What are the challenges related to price monitoring and dynamic pricing (repricing)?
Prices play a key role in the pharma market. Since advertising possibilities are often limited in this industry, customers pay even more attention to the prices when making a purchase decision. The importance of prices has been reinforces with the rising popularity of online sales. As several researches show, price is the most relevant factor for customers when purchasing online.
It means that an online pharmacy which wants to be the first choice for customers should offer competitive prices. Without a price monitoring tool it is almost impossible to track all the offered SKUs in all the relevant channels every day. With price tracking software, you can have a short glimpse on the panel every day. You can choose competitors which you want to compare to and check your shop’s ranking (position) in comparison to them:
Other relevant information displayed is about opportunities for profit increase or important changes in the market. In order to always be up to date, you can receive such insights in e-mail alerts as well.
The other functionality which is often used is dynamic pricing (repricing). It gives you a possibility to change the price in the online pharmacy according to i.a. the current market position. How does it work? You set customized rules according to which the prices in your shop should be changed. It can include such rules as “being the cheapest on Google Shopping”, “being cheaper than the average on the market” provided specific conditions (e.g. minimum profit margin). Thanks to that, you can automate your pricing without additional manual work and time needed. If you have seen competitors being always 5 cents below your price – it is very probable that they use such rules for their pricing.
The challenge which many companies face when tracking prices of medicines and other pharma products are several variations of products (e.g. different packages). With the proper software for price monitoring, it shouldn’t be a problem though – then every different package of product is treated separately.
The other challenge which our clients mention are different prices depending on the expiration date. Medications that have a closer expiration date, tend to be sold at lower prices. Dealavo customers that want to include this factor in price monitoring and automation, can consult it with Dealavo Customer Success representative.
3. Which functionalities and reports provided in the price tracking tool are crucial?
What is relevant when looking for a price monitoring & repricing software?
- Clear market overview – price monitoring tool should enable you not only to check your position on the market but also to identify the most relevant competitors. In the Dealavo tool, you can see your position on the market in regard to every single product and see how many other online pharmacies offer it. You can also easily see which products you have in common with each of the competitors.
- All data integrated into one place – thanks to having the data from all the platforms in one panel, you can understand the situation with one glimpse only.
- Data displayed in charts – there is no easier way to see a trend than looking at a chart. That’s why at Dealavo we try to visualize the data in a very intuitive way – with charts including information about different competitors’ prices in a specified time range
- Dynamic Pricing – to react quickly, it is recommended to implement dynamic pricing based on custom rules. In the pharma industry, in which prices change very dynamically, it is especially important. Some customers use different rules depending on the channel or country – with Dealavo software it is not a problem.
- E-mail alerts – to be always up to date with relevant changes in the market, you should make sure you can receive e-mail notifications every time there is an important price increase or decrease in the market, or when there is an opportunity to increase your price, etc. With Dealavo, you can choose when exactly you want to receive such an e-mail (e.g. when the prices decrease more than 5%).
- Different variant tracking – it is important to take into account different packages of the products. In the pharmaceutical segment, it is a common challenge (medicines are sold in different packages), but with such tools as Dealavo, you get each variant treated as a separate SKU.
- API integration – to implement data from the tool to your system, API integration is crucial – especially if you monitor hundreds or thousands of products. With Dealavo, you always get an API. Other forms of data integration are possible as well.
- Data available in csv – for data analysis, it can be important to have data in csv format as well. Dealavo offers it for all of the clients.
- Availability information – it happens that your competitors offer products at very low prices, but then it turns out that they are not available. It can even happen that even though there are several listed offers, you are the only online pharmacy that actually has the product. In the pharmaceutical industry, availability is especially important – customers usually want to receive the product as soon as possible and don’t wait until the product is available with the purchase. That’s why it is crucial to have availability information in the tool.
- Frequency of the updates – to react fast, you need frequent updates. It is especially important in the pharma market in which prices tend to change very dynamically. At Dealavo, we can offer you to refresh information even every 15 minutes.
4. How to start monitoring prices systematically?
Once you decide price monitoring and repricing are crucial, here are the next steps you should follow:
- Fill the contact form to have a call during which we could understand your needs and discuss how we can help.
- See the demo of Dealavo price monitoring tool
- Choose the products you would like to monitor
- Choose the websites you would like to track prices on – these can be marketplaces, price comparison websites or online shops
- Our team will do the rest!
Learn more about price tracking in the other industries: