Keeping an eye on the prices of your e-commerce store’s products is essential to gain competitiveness inside your vertical. One of the best ways to control and, at the same time, optimize your prices is due to price tracking tools. Thanks to these tools, you will be able to set truly competitive prices.
Until recently, many e-commerce stores used to track the evolution of their prices and their competitors’ by using conventional spreadsheets. The problem of this methodology was the considerable waste of time and the limited optimization you could obtain from the collected data.
Manually entering the entire data does take not only a big amount of time but also a significant investment of money, as having a specific worker for this role turns to be a not very profitable and inefficient method in long term. Besides, if you want to control your rivals’ prices as well, the volume of data you there is to analyze expands greatly and the optimization is less effective.
On this matter, pricing software is one of the critical tools to make proper market research and optimize the process of collecting relevant data for your e-commerce. By clearly visualizing your prices’ evolution, you will be able to detect tendencies and opportunities, which will help you maximize the number of sales.
Let’s take a deep insight into the benefits of using a price tracking tool for e-commerce retailers:
Boost your competitiveness greatly inside the vertical
If you want to improve the competitiveness of your company, it is crucial taking into consideration your competitors’ movements through a useful price comparison tool. This will not only help you better understand the situation of the price of a specific typology of product inside your vertical but also, as a consequence, you will be able to adapt your prices to the market status and offer competitive prices.
One of the principal indicators you need to take into account is the price index. This metric determines what the level of competitiveness is in relation to your competitors. If you price index (PI) is equal or higher than the reference figure, it means your grade of competitiveness is suitable for your market.
On the contrary, if the PI is lower than the reference figure, you ought to improve your competitiveness by lowering prices according to the reality to increase the conversion rate. That is another key indicator not to be missed, together with the profit margin. We recommend you not put in risk your profit margin trying to increase your conversion rate.
Improve the positioning of your e-commerce
By offering more competitive prices, the positioning of your store will also improve. Being well positioned concerning your competitors is vital to be perceived by the users as a competing e-commerce store. Proper positioning will bring you more traffic and, consequently, more sales opportunities.
In addition to the three metrics (price index, margin, and conversion rate), it is also necessary to apply a well-designed pricing strategy. Several factors can influence your approach: from purchasing costs or the time of the year to the type of vertical and product you are working with. However, one of the most determining components you cannot forget when setting a good pricing strategy is monitoring the prices of competitors.
Price comparison tools are perfect assets that turn out to be a powerful solution to analyze competitors’ prices, their fluctuation inside the market and the impact of those changes for your products.
Your performance will improve due to tracking prices
In this scenario, controlling the prices of your e-commerce through price tracking tools will enable you to enhance your competitiveness inside your vertical; improve your positioning thanks to a proper pricing strategy and a well understanding of your primary metrics; save a considerable amount of time and money by automating the process of collecting data, which will be continuously updated.