Dynamic pricing is the pricing strategy where you modify the prices of your products according to various aspects. But like any other pricing strategy, it takes time and market study. You cannot copy a pricing strategy because it works for a specific company. Here is a guide to building a dynamic pricing strategy. 

1- Define your objective 

First, you need to investigate the market your company operates in and see how you stack up with your competitors. Here, you examine the prices of your products and the number of products you have. Also, you must think about your customers. How do they see your company?   

Another point to consider is to ask yourself or the people in charge: why do you want to implement the strategy.     

2- Choose products or brands 

Now it is time to pick the products or brands you want the pricing strategy to apply. Pricing programs like PriceTweakers let you choose from brands, categories, and tags. And also, you can exclude products using brands, categories, or tags.

3- Pick your strategy 

Once you pick the products, it is time to pick your strategy. PriceTweakers has many, but here are the most common.   

• Cost-plus pricing: In this pricing strategy, you take the cost of producing a product and then sell it for more than you spend on the production. Many companies use this strategy as their principal pricing strategy. 
• Competitor-based pricing: You set your products’ prices according to your competitors. 

Source: A view from PriceTweakers software.

4- Establish conditions 

After you have chosen the best pricing strategy, you can add conditions. PriceTweakers offers you different conditions to your pricing rules to have the best combinations. That goes from stock information to the number of competitors. As we said, there are many conditions, and you can mix them how you want.    

5- Publish and monitor 

You are nearly done with setting the dynamic pricing strategy. Now, it is time to review everything before publishing your pricing strategy. To do that, ask your pricing team or colleagues to check it in case you missed something. 

Conclusion 

To create a dynamic pricing strategy, you need to follow these steps. You cannot copy a pricing strategy from another store because it won't work. You must analyze everything first before you create and implement a dynamic pricing strategy. PriceTweakers offers you the perfect tool to monitor your competitors and build various pricing strategies that will help your store increase its sales and profit margins. Contact us here if you are interested.   

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