On eCommerce, it is typical to hear about having the right price at the right time. When we mention time, we are not talking about a specific date, like before. We talk about having it at the correct minute because changes now happen quickly. We no longer see a product having the same price for days or weeks! Online products now have different prices on the same days and even hours. That occurs because customers are driven by the price, so companies modify them frequently. 

Do you know the method to learn which is the perfect price for your products? The answer is by performing price intelligence. Price intelligence is the monitoring of your competitors. You can do this manually or use a pricing program that will do this for you faster and more efficiently. 

However, not all companies use price intelligence and that is a problem for online sellers. So, what are the problems businesses that do not perform price intelligence face? Let’s take a look at them! 

1- Low sales and profits 

Offering the wrong prices for your products will lead to a loss of sales and destroy your margins. Most of the time, companies price their products incorrectly because they do not conduct research. But you cannot price your products without reason. You, as an owner, must have a plan and a pricing strategy that supports the price you gave to a product or service.  

So, how can you price your products? Price the item too low, and customers will think you are selling a low-quality product. A study by Vanderbilt discovered that consumers see low prices as a sign of a low-quality product. Price it too high, and nobody will buy from you.     

For new products, it is even worse. An article published by McKinsey found that 80-90% of poorly priced products are too low. Sellers think that underselling a new product helps them promote it, and that may not be the case. The problem is when companies decide to increase the price, and customers will not like this. They will remember that you had a low price before. That is why you must have a pricing strategy that fits your needs and objectives. 

2- Market share loss 

Customers are looking for a product that fits their needs and demands. They are willing to pay a high price if they think it is worth it because they look for quality. So, if you have a good quality product and put a low price, you will lose customers. Why? Because customers will think you have a low-quality product.  

Applying price intelligence helps you gain more customers and increases your market share. How can you do that? Let’s look at this example from a well-known online marketplace. Amazon has an enormous market share in eCommerce. Amazon sellers modify the prices of their products constantly to beat the competition. Business Insider discovered that Amazon changes its prices every 10 minutes. They know that monitoring the competition is vital for creating pricing strategies to beat the competition. 

3- Affects your search performance 

Price plays an influential role in eCommerce for your SEO and page optimization. If your company does not have the correct price or at least a competitive price, you will lose places in the search ranking. It is one of the factors taken into consideration to increase your search performance. 

4- Inefficient pricing strategies 

Without the data and insights provided by price intelligence, online selling companies may turn to guess and intuition when setting prices. This approach is highly inefficient and can lead to missed opportunities for profit. Moreover, it can be challenging to adjust pricing strategies in response to changes in the market, resulting in missed sales opportunities and less profit. 

5- Damaged brand image 

Another significant impact of the lack of price intelligence is the damage it can do to a company's brand image. Overpricing products may lead to customers feeling cheated. Underpricing may lead to customers perceiving the products as low quality. That can have long-term consequences on a company's reputation and customer loyalty. 

Conclusion 

Price intelligence is the online monitoring of the competition in eCommerce, but not all companies apply it. That is a mistake that costs organizations money and has more consequences. PriceTweakers is the best solution for your company because we automatically monitor your competitors 24/7, and you will receive the best information regarding your competitors and their products. Using PriceTweakers will save your business time and money.    

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