Obviously, you should track your competition’s pricing. There is no question about that. With all the competition that’s constantly growing, consumers have their veritable pick of the litter. In essence, they are spoilt for choice and can easily find the best deals on the required products in just a few taps or clicks. So, in order to keep up with the savvy customers and competitors, businesses turns to price tracking. It allows them to be increasingly competitive and focal in their efforts while achieving greater profitability through the use of data.
In principle, there are two ways price tracking is done:
- Manual tracking
- Automated tracking
In a true gladiatorial nature, this post will pit the methods against each other and evaluate what’s the best option for today’s retailers. Minus Russell Crowe, of course.
Round 1 – manual tracking
As every pricing manager who ever dabbled in manual price tracking knows, it is essential to make an analytics based on the huge data acquired. Usually, there is a team involved that covers various aspects of competitor’s pricing by using Excel spreadsheets to keep all of the information in one place. The information itself is detailed as it can be and, as there’s a lot to go through by doing it manually, it takes time.
Ultimately, the enormous usage of both time and resources severely limits the scope and effectiveness of manual price tracking. Here is an example of how that works (or not, depending on your perspective).
Let’s say you have 100 products in your online store. It’s a nice, round number (why would we ever want to complicate this?) and in reality, it’s really not a big amount of products, but bear with us. Previously, you have identified five key competitors (also not a big amount) whose prices you wish to track. Now consider this – competitors change their prices all the time so if you choose to check them on a daily basis, that’s tracking a minimum of 500 references a day. Mind you, this is without taking into account more than one price per product, something which is a common feature depending on the product’s attributes. It’s a lot of time to be spending on only a select few of your competitors, not the mention the workforce needed to pull it off.
Rest assured – manual tracking works, but only up to a certain degree, most notably for very small businesses who don’t have a lot of offerings. Unfortunately, in today’s rapidly evolving ecommerce market and advanced technology, it’s far from being enough. Even if the amount of products offered in your catalog is tiny, the competition isn’t and that is your primary concern. Hey, it’s not like the competition doesn’t already know things about you, right?
Round 2 – automated tracking
Posing as a challenger in this bout, automated tracking solutions have a lot going on for them. Whereas manual efforts to gather competitive intelligence prove to be non-scalable and ineffective after a certain point, automated solutions don’t have that problem. They effectively reduce the amount of time your team has to spend manually tracking the prices of your competition. In turn, they have more time to focus on other important aspects of the business.
So, automated price tracking solutions are real time-savers. What else?
Every day, online businesses are operating in a growingly competitive environment that demands a proactive response to market fluctuations. It is impossible to deliver in such fashion without basing your decisions on readily-available real-time data. Your customers are checking prices on a daily basis and it’s easy for them to compare them. With the dynamic pricing on the rise, the ability to effectively and quickly react to shifts in the market presents a significant and highly sought for competitive advantage. Real-time data equals real-time pricing, which means your business will stay at the forefront. Tracking millions of products on the web is impossible through manual methods, but fairly easy with automated solutions like Incompetitor who help base your pricing strategies on a regular basis.
Incompetitor retail analytics software
The accuracy of automated solutions is another advantage over the manual process as it allows for simple pricing updates. Things like price drops and promotions can easily be missed with manual tracking, which is not the case with automated price monitoring. This also minimizes the ever-present human error factor which has the power to significantly distort the accuracy of your data.
An automated price tracking solution allows a better overview of your market. It helps you perform an in-depth market research with no limit to the offerings you want to track. Additionally, it can also help you identify new competitors, along with the ones you are already keeping tabs on.
And finally, we dare say it – it’s much cheaper, especially for businesses who cover a wide spectrum of the competitor landscape by ramping up the manual labor in order to cover as much as they can.
Due to the nature of the business environment, online businesses today need every technological advantage they can get their hands on, in order to successfully track competitors’ pricing. On its own, technology is making it necessary and possible, even imperative to be more competitive by having real-time insights. This turns automated solutions as clear victors in this case. The return of investment by using an automated price tracking tool is fast, easy and, as evidenced, benefits you in many ways. While manual tracking gets the job done, for the most part, on a very small scale, it’s being overrun by the modern exploits of technology. Plain and simple, the scope of work is bigger, better and faster, as well as more accurate.
For an e-commerce store that is looking to keep a close eye on its competition’s pricing, there are many benefits to using automated pricing solutions. They provide real-time insights into how its competitors are doing business and allow for the making of the right decision in the right moment. Obtaining detailed and accurate data on the prices of competitors makes the most of your pricing policy and increases the profit margins, allowing you to stay competitive in the long run.