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Dynamic Pricing Optimization

SMART AND INTELLIGENT PRICING FOR ONLINE RETAIL

Advantages of dynamic pricing strategy

E-commerce pricing strategy intends to find a competitive advantage and profit maximization for an online store.

Dynamic pricing as a pricing strategy can be adopted in different industries by relevance. A good pricing strategy in the online retail industry should bring the best pricing position towards the main competitors, and win customers using actual market insights.

Dynamic pricing in e-commerce retail is specific because it proceeds from a product-oriented approach to pricing. In other words, dynamic pricing in retail lies in price adjustment for a product for all customers at that moment.

This means all consumers need to see the same price at the same time. Hence, therein lies a question - what are the key criteria for price adjustment in dynamic pricing?



Competera dashboard

Key criteria for price adjustment

Every dynamic pricing platform offers a different data basket to produce price recommendations for an e-commerce business.

There are 3 key points for automatic monitoring for the case of e-commerce retail:

  1. competitor's price
  2. stock availability (assortment)
  3. promotions

Product repricing should be provided as soon as it is required by current market conditions and your business goals.






Efficient pricing strategies for online retail

An automated dynamic pricing in e-commerce retail is a convenient solution for Pricing Managers. There are two reasons to consider about the implementation of a dynamic pricing algorithm:

  1. The quality of data does not depend on human mistakes while conducting competitive price monitoring.
  2. Automated solution saves both time and energy for Pricing Managers, allowing them to focus on their direct responsibilities.
Competera dynamic pricing benefits



Dynamic pricing model

Dynamic pricing suited to the e-commerce retail industry streamlines the process of collecting big data, improving the pricing strategy of online retail.

Automated solutions for online retail make online pricing strategies an engine of profit and business development.

Strategic pricing can implement one of the classic models, or combine their elements with dynamic pricing.



E-commerce pricing models

  1. Cost Plus Price. Add the fixed amount to the cost of a product in order to find the retail margin. This method doesn’t require extensive knowledge of the market and gives a clear price. However, if sales are not doing well, you are compelled to reduce the price at the expense of the margin.
  2. Markup. The selling price is found by the cost of the product, plus the percent of it required to cover all disbursements.
  3. Demand-Defined Price. Set the price according to the current demand for the products. The demand curve can be based on the sales test, and the starting price should be slightly overpriced, considering the possible necessity to make it lower.
  4. Value-Based Price. The final price based on product value for a customer at the moment. To find the price using this method you need to get a competitor’s price, due to the value being determined by the variety of alternative choices of making a purchase.



Automated dynamic pricing

Dynamic pricing suited to the e-commerce retail industry streamlines the process of collecting big data, improving the pricing strategy of online retail.

Automated solutions for online retail make online pricing strategies an engine of profit and business development.

Strategic pricing can implement one of the classic models, or combine their elements with dynamic pricing.




COMPETERA OFFERS SUCH BENEFITS AS:

  • Online fully automated competitor price tracking tool, which eliminates days of manual work and possible human error
  • Collects and updates information as often as necessary, with flexible configurations which allow for custom time settings for different categories
  • Smart scraping technology that doesn’t trigger a website overload
  • 24/7 technical support and client assistance
  • Email notifications and reports
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The process of developing and implementing a proper pricing strategy is easier and more efficient with Competera

because of benefits suggestions which are price monitoring on SKU level, timely data delivery (if one needs data at 9 am - Competera delivers it at 9 am), notifications on competitors price changings and price history analytics.

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