As the eCommerce superhighway gets more congested and competitive, online retailers must find ever-more-innovative ways to attract customers and make sales. Pricing intelligence tools have quickly become essential to rapidly access and act on data on pricing, product availability, shipping charges, promotions, and the like. Pricing analysis helps online retailers be more savvy, competitive, informational and timely, resulting in positive purchasing decisions by consumers.
Here, in order of importance, are 10 key factors to consider in choosing a pricing intelligence tool:
Since pricing intelligence tools are used to make pricing decisions, accuracy is paramount. As pricing decisions directly and dramatically affect sales, it’s critical that the data provided by the tool is accurate. Choose a pricing intelligence tool that's sophisticated enough to provide you with near 100% accuracy -- or you'll be making decisions based on poor quality data, which you can’t afford to do -- and they can really hurt you.
Traditionally, performing pricing intelligence on a regular basis required a lot of hands-on, often onerous, and sometimes unproductive labor. The result was that retailers would look at their competitors' prices once a month or even once a year. With important decisions and price adjustments now needing attention more often, automated pricing intelligence tools are necessary to provide the information frequently, while minimizing the actual work of gathering the data. Use a tool to track your competitors' prices that is 100% automated. Your work begins when you login, get and use the specific information designed for you, and act on the competitive data the tool provides exclusively to you.
One of the main reasons for using an automated tool is to get an updated view of competitors' prices in a timely manner. Good pricing intelligence tools should provide you with updated data at least once a day, and in certain cases, even more frequently. For most industries, that frequency should be sufficiently often enough to be like real-time data enabling you to always be ready to make the latest – and best -- pricing decisions.
Upstream Commerce's pricing intelligence tool scans competitors at least once a day
Pricing intelligence tools create value by letting you match your prices with your competitors’ and create comparisons -- whether for 5,000 or 5,000,000 products. The best tools have powerful matching engines that automatically and accurately match up the same products appearing on different websites. How well the matching engine matches your products with your competitors' - coverage - will affect the information you have to work with. Note that not all matching engines are the same -- getting as much of the data you need about your competitors and their products can make a big difference.
Online retailers use competitive price information in different ways. Even within one organization, several people may use competitive price information differently. It's important to have a pricing intelligence tool that is flexible enough to provide the data you need the way you need it. The best pricing tool will allow you to view and compare your data as graphs, charts, color-coded bars, and other easy-to-read formats. The ability of your pricing tool to add columns, filter, and create customized reports is a must.
Technical tools, especially analytics-type tools, can be, and usually are, complicated on the inside (which you don't have to worry about) and easy to use by people like yourself, so usability is paramount. You have to make pricing decisions on thousands of products; the information you need is presented simply and easy to work with. Since you primarily need to get actionable information about pricing (what prices you should change and by how much?) it’s important that the tool makes this as simple as possible. In other words, the best tool will focus on analysis and data to get you the information you need, ready to utilize in the most beneficial way, without having to figure out how the program works.
Viewing how you are priced relative to your competitors, by product, category or brand/manufacturer is one thing, but being able to see how these prices change over time gives you significantly more insight. Make sure your pricing intelligence tool provides you with information so can see the price dynamics that exist between you and your competitors, qualify and follow trends and competitive behavior, and allow you to plan and respond intelligently.
Upstream Commerce pricing intelligence tool - Price history page
Most pricing intelligence tools provide you with information about how you are priced relative to your competitors on a product-by-product basis. Some, however, will go beyond that and provide you with real analytics to help you determine how competitively you are pricing. For example, one of the tool's basics will have list of products showing where you're priced in relation to your competition; another look at the information will be a graphical view of categories of a few hundred products, showing how many are priced above, below, or the same as yours. The best tools allow you to see all of your categories, how priced, and can show you the whole picture in one view -- or in selected groupings. These features allow you to analyze your pricing by brand and product categories so you can better analyze and decide on your overall pricing strategy and policies.
Upstream Commerce pricing intelligence tool has advanced analytics
#9: Stock Status & More
Pricing information alone does not provide the entire picture. Whether a product is in stock or out of stock, discontinued, or on sale or promotion are all pieces of important information. Make sure the pricing tool you choose provides you with this information, updated on a regular basis; it can dramatically affect how you price and provide information on your own product mix or product assortment; also important information about the availability of a product (or lack thereof), which will create marketing opportunities for you.
At one point or another you’ll want to export the data collected by your pricing intelligence tool. Whether you export to Excel and perform your own analysis on the data, or you export using APIs (Application Programming Interface) on a continual basis to one of your back-end systems such as an ERP (Enterprise Resource Planning) system, make sure that the tool you’re using allows you to export all the data in an easy and convenient manner.
Choosing the right pricing intelligence tool is one of the more important decisions for online retailers today. Online retailing has quickly become a dog-eat-dog scenario – and you need to be the smartest, if not the biggest, "dog" out there. Not all pricing intelligence tools are the same. The right tool will provide a full combination of the characteristics listed above to provide you that razor sharp "edge" that you need in today's world of eCommerce. Compare, and make sure to select the best pricing intelligence tool to lead the pack down the eCommerce superhighway! "Gentlemen and ladies... start your engines!"
I’d love to hear what YOU think are the most important things to consider when choosing a pricing intelligence tool. Please comment below. Thanks. Gilon