"How often do you/your company track your competitors' moves and pricing?" That was our recent poll question to our 1,858 members -- primarily retail executives -- on my LinkedIn group, Competitive Pricing for Online Retail. Take a look at the results of the poll, below, plus a number of interesting responses from group members, followed by 6 MAJOR Reasons To Track Your Competitors' Prices Every Day:
The Poll Question: "How often do you/your company track your competitors' moves and pricing?
- 24% of the respondents track their competitors' moves and pricing every day.
- 16% track a couple of times per week.
- 30% track once a week.
- 18% track once a month.
- 12% track "hardly ever".
The bottom line that these results show is that 75% of retailers DON'T check and track their competitors' prices every day.
Comments from members of the group:
Here are some interesting comments from our knowledgeable group of respondents. After that, be sure to read 6 MAJOR reasons why it's important for retailers to track their competitors' prices EVERY DAY, below.
* Director, Development & Marketing, Retail Chain (Latvia): "Price policy is the essence of our business; in this environment you cannot be successful if not properly monitoring competitors. We monitor prices at least 2x per month, but (we monitor) other moves on a daily basis."
* Sales & Marketing VP, Furniture Company (Canada): "In the retail furniture business, we are constantly monitoring competitors' advertising, in print and online. We send our staff periodically to visit nearby stores, and, as buyer I am looking not just for pricing but also for new items, suppliers etc. I personally visit every showroom in our market at least twice a year and spot visits in between."
* Sales Director (UK): "If your customers are checking prices every day then so should you." My company scrapes web prices twice per day and we provide the data to contacts in the UK, France, Italy and Germany… We have studied the major retailers in these markets and find that this frequency captures 99% of price changes for the major retailers and websites in these markets."
* Strategic Marketing & Planning, Consumer Goods (Brazil) "…we monitor MOVES every day. Prices not so often… After all, ours is a B2B equipment manufacturer company. Prices are not that volatile and the price lists are not so easy to obtain. The difficulty is really to distinguish between stated prices and the ones actually applied since there are many discounts and other commercial policies that get in the way. Customers tend to tell us about competitors' prices but the information has to be filtered.
The previous member was also kind enough to offer insight into an EXTREMELY important concern in his industry: "At first, the market was naturally split between the high quality high priced against the low quality low priced manufacturers. But that is changing dramatically and very quickly. Low-priced competitors offer high quality and the market is learning that. In the meantime, traditional manufacturers are struggling to find added value to their products while they are forced to adjust adjacent costs and their pricing policies. It is very difficult to determine how fast and how far you should go in any of these directions. It is mandatory to monitor whether traditional competitors are doing it, as well as the new ones. In such a context, monitoring competitors' pricing is no less than a matter of life and death. It is all about survival. Hopefully a profitable long-term one".
* Director, Sales & Marketing, Appliances (Canada): "In the appliance industry, pricing isn't a daily thing. White goods may have weekend deals, based on buy opportunities, but for the majority, like our brands, we may adjust pricing once a month or quarterly… I can only comment on the high-end appliance sector… high-end appliances tend to be a little more normalized with regard to pricing. Pricing programs may be monthly or more often quarterly. Over the past few years, most brands have gone to a minimum sell programs, enforcing the bottom price and forcing dealers to sell their additional services to close the deal."
We at Upstream Commerce extend our gratitude to everyone who commented and participated in the poll on how often to track your competitors' prices.
Here are 6 MAJOR reasons you should track your competitors' prices daily:
1. Price tracking daily is vital because competing in online retail is happening more and more in "real time". In certain industries, prices are, in fact, being changed every day, regularly. We see prices being changed even more frequently than once a day with some of our customers. A retailer in consumer electronics using our price intelligence tools recently told us that every time he changes prices, he can see that his competitor quickly follows by changing their prices.
2. Price tracking on a daily basis gives visibility into price dynamics.
Price history chart from Upstream Commerce. Every dot represents a day of tracking whose patterns you can see at a glance.
When you do price monitoring on a daily basis, it gives a visibility into price dynamics, i.e. you will literally be able to see how prices change over time, how competitors are reacting to your prices, and determine what trends are indicated. You won't have this valuable information to look at if you're not tracking regularly.
3. Price tracking on a daily basis lets retailers be proactive regarding competitor pricing. Regular Email alerts which we send out to our customers allow them to be proactive. Our customers receive alerts/reports on products they've labeled to be checked daily, telling them which ones change at their competitors' every day.
Example of Email Alert from Upstream Commerce
4. Price tracking on a daily basis allows retailers to deal with automated pricing systems such as Amazon. Companies with automated pricing systems like Amazon are often trying to price lower than you. To be able to compete effectively, you have to see what prices Amazon is pricing at, and what prices your competitors are pricing at. (For more on this see my previous blog post, 3 Ways Automated Pricing Systems Harm Online Retail Business).
5. Price tracking on a daily basis helps retailers develop a more effective pricing strategy. You'll get a better feel for how competitive your pricing really is because you're "living" your pricing on a daily basis. With the increase in visibility into price changes over time, you're able to develop a more efficient strategy -- if you live it and "touch it" daily, you have a much better feel for it.
6. Price tracking on a daily basis means you are most likely tracking your competitors more frequently than your competitors are tracking you. If you are doing competitor price monitoring on a daily basis, looking at the poll above, you'll see that you are doing it more than 75% of the others, making you far more competitive than those who are not.
For more information on Pricing Intelligence, go to: Upstream Commerce.com.
With retail becoming increasingly more competitive, prices are being changed more and more frequently, there's more transparency of information, and the whole retail environment, especially the online retail environment, is becoming much more real time; so there are many very compelling reasons retailers should track their competitors' prices every day.
* To view a demo of the Upstream Commerce Retail Intelligence Suite, click here.
* To view the entire LinkedIn poll and join my LinkedIn Group, click here.
Finally, here's one more chance for you to tell us, what do YOU think about tracking your competitor's prices daily? Please add your comments below. Thanks. Gilon