Are you a business owner and sell your product? Have you an eCommerce website? How do you decide the pricing of your products? Have you ever made research before making the pricing decision? What is the main force that motivates shoppers to purchase a product? What do you consider important factors: quality, design, brand, or price? The studies show that 60% of customers consider pricing as the most important factor in making a decision to make a purchase of a certain product. If there is a recession it may increase 15-20 points more.
Pricing decision making
Though there have been a lot of changes, our decision-makers don’t have the power to come up to a difficult economic situation. Online retailers are no exception. They do not understand the importance of the pricing factor. Retailers consider internal costs and competitors’ pricing important things to discuss. Some other things take place like cart rates and customers’ bad feedback. Pricing analyst has to do all. It is their duty to keep in view different pricing factors. They have an eye on their rival, prices move.
You and I know how obvious this is but most decision-makers still don’t understand how important it is to survive in tough times. Especially for online retailers’, the pricing process is one of the most complex and hectic parts of the business. Lots of meetings get held, internal costs and pricing is checked, and competitor moves are given as an example. If there’s time left from all, abandoned cart rates, return rates, and bad reviews might come once in a while as well but they’re usually left for another conversation.
So, everything is on the shoulder of pricing analysts. They track competitors’ pricing changes and analyze how their own prices are performing every day. The data is there, competitors are hustling 24/7, and shoppers are lingering here and there waiting to make a decision. You have 1-3 seconds to win or lose a customer.