Every business objective is to sell and succeed, but how come only few companies stick to their price points in their particular markets?
Selling a product isn’t always that easy when you have to live up to expectations, since pricing has become an important asset to consider when launching a new product or service, now that customers are becoming more conscious about prices, and how it affects their purchases.
But here’s the most important part: The following claims “We promise you the lowest priced product” or “We will give you a discount if you find a lower price in another store”.” is where the concept of price matching comes in.
Price matching strategy, what is it ?
Price matching is a strategy used by retailers in order to provide the best price for customers in a certain competitive market, by offering the same product for a lower price to increase sales, catch customers’ attention and strengthen customer loyalty.
So before we go any further, remember that this strategy relies on certain purposes, some retailers will undercut prices, while others make efforts to beat the available options.
This is how it goes: Regardless of what customers may choose, it is important to know that price matching is carried out in two different ways.
- The first way is when a retailer decreases the price of a product when a customer provides evidence that the same product is being sold lower by the competitor.
- The second way is when the customer receives the difference of the product purchased after he has demonstrated that the product was cheaper, and this practice does not exceed 15 days.
Let me give you some examples:
While Amazon and Walmart are competing to be the e-commerce leader, eBay is trying to make a comeback by announcing that they will price match Amazon for around 50,000 products, and they will also provide the best prices available online if customers can justify and find a cheaper price on a competitor’s website.
Who can beat that ?
It seems that Best Buy is the first seller to price match Amazon. They provide a price match for only one identical item per user and, in addition to that, they price match Apple, Dell and other companies.
All in all, the practice of price matching can shape your customer’s perceptions, that will make them believe that your company has the best interest in their favor.
Good news: Netrivals price intelligence integration can offer retailers the possibility to always offer the lowest price and helps them define a dynamic pricing strategy.