What is Competitive Pricing Intelligence?

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Price intelligence, also commonly known as competitive pricing intelligence, is a pricing methodology in which an e-commerce store defines its prices depending on the real market situation and according to several parameters or conditions set by the same e-commerce.

It is a methodology where prices are based on the competition and the market, and usually is used in very competitive verticals, where the number of rivals is quite large, and competitiveness among them is based basically on the products’ price. One competitor may apply a change in its prices, and thereupon, all other digital stores change their prices too to stay closer to the most competitive price. But, are you sure lowering prices is the best choice for you?

The process of price intelligence


  1. Price monitoring

  2. First of all, you need to monitor competitors’ prices. It is way more effective when you automate the process instead of doing it manually; as manually, the level of optimization will not be enough, and it would be too expensive and exhausting. However, when you automate the monitoring process with some price optimization tool or software, you will be able to speed up and widen your capacity of collecting relevant data.

    By “competitors”, we refer to your direct competitors. However, you can also track indirect competition, if afterwards, the data collected is going to be useful for some particular purpose, such as optimizing prices, for instance. By having your rivals adequately identified, you are going to confirm the fact that existent competitiveness over the internet is real and severe.

    Furthermore, the fact that users choose where to buy basing their decision almost uniquely on the value of the product, without considering other assets of your e-commerce service, makes it extremely necessary to set up a price intelligence methodology.

  3. Define a pricing strategy

  4. Once you have started monitoring the prices of your direct competitors, you will be able to visualize what is the state of the real market situation and how is it changing. With all this, you can design a proper pricing strategy that fits in this situation and among your competition’s prices.

    Thanks to these tools, you are not only tracking rivals’ pricing but also making a competitive benchmarking analysis. You can obtain relevant data, reports, and analysis that will help you understand the market’s fluctuation and how to optimize your products’ prices.

  5. Segmentation & competitive pricing

  6. Due to some specific functions (such as report’s creation or product’s segmentation) this type of tool enables you to focus on several particular products, categories or brands; to get the most out of those top-selling products that have more chances to be optimized in your e-commerce.

    As we already explained, competitive pricing intelligence bases its suggestions depending on competition’s prices and according to the parameters set by the same e-commerce. These parameters or rules can be applied to one (or more) category, brand or product list.

    Imagine you want the products of a certain brand to be 5% cheaper than your direct competitors’, and also, you want to have the profit margin respected until 15%. The software will calculate the new price automatically.

    Then, you are not only capable of offering competitive prices inside your vertical, but also of making sure these prices will be set according to your criteria. Thanks to this tool, your minimum profit margin will not be affected by a drastic price decrease.

    After confirming the new price, the software will update the latest data automatically into your e-commerce store’s feed, so you do not have to do it manually one by one.

    These price intelligence tools are crucial to improve your competitiveness, understand the market’s situation, identify your rival’s pricing strategy, and improve your positioning among your rivalry’s ranking.

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