How often do you change your prices? Is it seasonal or based on your competitors' price changes?

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as e-commerce retailers, how do you approach these two different strategies? Which one do you think is more effective?
#based #change #competitors #price #prices #seasonal
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  • Profile picture of the author dave_hermansen
    We base our prices on competition. Of course, this is niche dependent. If you are selling brand name products, you pretty much have to do a lot of competitor research and make sure your prices are inline with the major players. If you are selling your own brand, it's more about convincing customers that your price is worth it.
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    • Profile picture of the author tropicalpet
      Thanks Dave for your answer! Let me ask you a question!

      What is your industry? What kind of products are you selling? How many products are you focusing on while changing prices?

      Actually, I have a lot of products and 5-6 competitors. It is quite hard for me to track all the prices and reprice my prices.
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      • Profile picture of the author dave_hermansen
        Originally Posted by tropicalpet View Post

        Thanks Dave for your answer! Let me ask you a question!

        What is your industry? What kind of products are you selling? How many products are you focusing on while changing prices?

        Actually, I have a lot of products and 5-6 competitors. It is quite hard for me to track all the prices and reprice my prices.
        That is an impossible question to answer, nor is it one that anyone who wants to protect their niches should answer.

        Suffice it to say, we currently have more than 30 different eCommerce websites that we own and they sell a very wide range of products.

        Most of our sites sell brand name products with an average sale price of over $400, some considerably higher. With those websites, we do a search for product names and look at the top few organic ranking sites as well as the sites showing up in Google Shopping results. We also take a look at Amazon to see what the prices are there. Fortunately, most of our sites sell things from manufacturers with M.A.P. pricing, so we don't have to do any price manipulation - everybody is selling at the same price. We just check periodically to make sure people aren't selling under M.A.P. pricing.

        We also have a few sites that sell impulse buy, very low priced products. With those sites, we set our own prices because we are establishing our own "brands" there. We'll take a look at whatever other generic products there are that compete with ours but the real goal is to separate yourself as a brand and make your products seem better than other sites with lowball prices. We usually start with our lowest acceptable profit and start inching prices up until we find the happy medium that gets us the most money without taking a major hit in conversions.
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  • Profile picture of the author kazim
    Well, the method from my point of view is a bit different than these two. I like to change the pricing according to the responses from the customers. The combination of the number of sales and number of traffic play a big role here.
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    • Profile picture of the author dave_hermansen
      Originally Posted by kazim View Post

      Well, the method from my point of view is a bit different than these two. I like to change the pricing according to the responses from the customers. The combination of the number of sales and number of traffic play a big role here.
      And that's a very good strategy, assuming you are not selling brand name products in a niche where everyone is selling at M.A.P. pricing. That's why I said it depended on the prodcuts and whether or not they were brand names. You certainly would not be allowed to go lower than M.A.P. and raising it above M.A.P. when the majority of competitors are at M.A.P. is not a very good strategy, either.
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  • Profile picture of the author divyakochar
    We would say 80% on competitors based and rest 20% on seasonal. For getting the good sales, and making product visibility on top of the others. Customer look after a attractive product once prices suits their budget.
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  • Profile picture of the author yukon
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    Very few people I've dealt with actually do comparison shopping.
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    • Profile picture of the author dave_hermansen
      Originally Posted by yukon View Post

      Very few people I've dealt with actually do comparison shopping.
      Again, it all depends what you are selling. If you are selling brand name items that cost $1,000 - $5,000, it is very rare that they do not.
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  • During busy shopping seasons, price becomes even more of a consumer touchpoint:
    customers are constantly monitoring for seasonal deals and bargains. Having the right pricing means you'll not only maximize profits from the seasonal crush, but you'll also provide customers with a great experience.

    On the other hand, Dynamic pricing and changing your prices for every time based on your competitors fuel the success of many big retailers: "Amazon changes its prices every 10 minutes on average." That's why, dynamic pricing will make your brand more flexible; and contrary to popular belief, it won't devalue or cheapen your brand. So if you are selling seasonal products like the swimsuit or ski items, it would be more applicable to set seasonal prices. On the other hand, if you are running a store selling consumer products like electronics, cosmetics, home appliances, monitoring your competitor's prices closely and being competitive will help you to generate better conversions and profits. And here, using a competitor pricing intelligence becomes crucial to make it more effective! Try to look for some smart technologies in the software market. So far, I've tried Prisync and experienced great features.
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  • Profile picture of the author ryanbiddulph
    Sticking to a price range consistent with top sellers in your niche plus trusting your gut seems to work A-OK. I'd not change per season though; just onward and upward, raising prices steadily as your influence grows.
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