Excel vs. Pricing Software for Retail
You might be wondering:
Is using a pricing optimization software more effective than using Excel?
Well, although they’re both tools that you can use to analyze data, using a pricing software is more effective than a spreadsheet.
Read down below to find out the pros and cons of using a Pricing Software versus Excel, as well as why it’s a more effective approach.
Pros of using a Price Optimization Software instead of Excel
1. Easily get an automatic visualization of your data
When analyzing data, it is important to get a good visual as quickly as possible so that you can see the bigger picture within moments. However, with Excel, data first needs to be inserted into the cells with special formulas. When you’re done, the data is still only displayed as a table. To be able to make an observation, you need to manually select a few options in order to generate a graph or chart from the table. On the other hand, a price monitoring software displays your data in either a pictorial or graphical visual from the start in order for you to immediately find a pattern from the information that it already has in the system.
2. There are no human-made errors
What good is data, when there’s a chance that it could have misleading information? When using Excel, numbers are input manually along with the formulas, so there is always that chance of making a mistake. Thus, your visual could come out incorrect and then future decisions could result in dangerous mistakes. Pricing tool software, on the other hand, eliminates that worry of depicting faulty information since the formulas are logically built in, you can automate continuous tasks, as well as input and export information automatically, so you can be absolutely confident that there won’t be any mistakes. In addition, you can monitor the competition without a doubt that the information that you are receiving is correct.
3. Automated-rules based pricing
Businesses must follow a certain pricing strategy, if they want to make any kind of profit. As the name implies, rules-based pricing is based on following a predefined set of rules that ultimately helps a company strategically plan for the future. It allows you, among other things to combine the most common pricing strategies, and create the most effective pricing strategy for your business. For instance, you can combine cost-based, customer-based, and competitor based pricing. Those three approaches are a great place to start, but dig deeper, and you will uncover a whole other world of pricing strategies under each umbrella. A few others include market penetration pricing, price skimming, and competitive based pricing. Click here to learn about the other pricing options and which one would be the most beneficial for your business. Pricing Softwares incorporate these techniques to help retailers automatically determine which rules are best for a wide range of products in various categories.
4. Make sure the MAP agreement is being followed
Rules are important if you don’t want people taking advantage of all of your hard work. Businesses need to watch out for those kinds of people who are trying not to play by the rules. For example, if you don’t want retailers stealing all of your customers, then watch them and make sure that they are following the MAP agreement. If you don’t want to be in violation of such rules, there’s a built-in function in Pricing Softwares that automatically makes sure that the MAP agreement is being followed. This is a great way to save time on doing the manual math and keeping up with changes as well as helps you avoid costly mistakes. It’s also more beneficial to agree to the terms than to disobey them than you may think. Learn more about why you should follow the MAP agreement.
5. Automated price appliance to the front store
Life in the 21st century is a lot more fast paced and busy, leaving you little room to do tasks that should be all automated at this point. Take, for example, Excel. Usually, when you work in that program, you need to first recalculate the price of the goods, then rewrite that price into the correct format, and afterward transfer that new price into the content management system so that it could finally be reflected onto the face of that site. Fortunately, though, for those of us that have better things to do than tedious tasks that require us to transfer information from one platform to another, we can use a Pricing Software to our benefit by automatically doing that whole process mentioned above for us.
6. Easily format the data
Excel isn’t exactly known for having one of the easiest-on-the-eye interfaces, and the look of the final product created in Excel couldn’t be any closer to the truth of that statement either. To keep not only yours, but the anxiety levels of others, at a lower level, take advantage of the different formats that you can use to import and export data in Pricing Softwares. We all got 99 problems, and the format ain't one.
7. Get notifications
Staying up to date, and in the know, about every good or bad thing that can either make or break your business is crucial. As a result, you need to be able to be notified immediately about any changes happening in regards to your company. With the help of pricing intelligence software, you can receive alerts about deviations, price opportunities, job failures and other market events. You can also automatically get customizable notifications from those who violate MAP and as we’ve learned from pro number four, following it is imperative.
8. Get an overview of the history of price changes
Imagine what the world would be like today if we learned from our history. Although humanity has decided not to pay attention to what history has taught us, businesses have found that it can actually be quite beneficial. As a result, Pricing Softwares provide you with an overview that shows you the history from your various competitors, the history of the category that your product falls into, the brand’s history, as well as the history of the individual product. There’s no way you’ll be stepping on the same worn down stones will all of this extra information.
9. Get more data in one place
If iPhones can include everything from an alarm clock to a navigation system to a way to connect with your loved ones visually over a distance, then why can’t we include all of our data that we need to use in one place? Well fortunately, Pricing Softwares do just that. Not only do you receive the prices of your competitors, but you also receive data such as the numbers of stock, the discounts, the number of inventory left, and the prices at which the product is purchased at all conveniently located on one platform. As a result, you get a complete picture of where your business is at and the market that it is in without reaching out to different platforms to try to mold that picture yourself.
10. Easily arrange items using tags
How messy the desk or the room of a person is can tell you a lot about how put together the mind of that person is. The same idea applies to the interface of a program. Being able to arrange things according to a category, brand ABC- or KVI-analysis with little to no effort is crucial and shows how effortlessly the program runs. Fortunately, in Pricing Softwares, you can easily add tags, alter them or delete them, depending on what you need in order to stay organized and have your business flow smoothly.
11. Work in one place
Being able to work as a team is impossible if you don’t have everyone working together in one place, or on one platform, in this case. As the saying goes, there is no “I” in “team”, but there is an “I” in “win”. In other words, you can’t work alone if you want to be successful. Instead, work together to achieve the ultimate goal. Therefore, have several managers as well as C-level management operate from one platform. Together, you will be able to get what each and every one of you are striving towards.
12. Get instant support
We learn the best by going through the motions and making mistakes. However, in order to learn from the mistakes, you need to be able to have someone to guide you through them and provide you with the best solution. As a result, in Pricing Softwares, the manager of the pricing software will assist you with how to use it more efficiently, will tell you about existing options and so on, in order to become a better and more efficient user.
Cons of using a Price Optimization Software instead of Excel
1. Some time will need to be spent initially
Just as with any new toy, appliance, technology, etc. some time needs to be spent in order for you to learn how to use it properly. Getting used to a Pricing Software is no different. Additionally, you’ll initially have to move the data from Excel into the Pricing Software, but afterward, you won’t ever have to do any more manual work again.
2. You need to pay for the monthly subscription of the Pricing Software
Businesses have to deal with different trends within customer behavior on a monthly basis, and thus have to change the features of their products over the development cycle.Thus, it may even be a better option to subscribe on a monthly basis. However, you do need to be prepared to invest on a monthly basis instead of just paying once for a long-term contract.
3. May not be the best solution for every business
Just like anything in this world, some things may be great for some, but definitely not the best option for others. The same goes for switching to Pricing Software. The transition to a Pricing Software is directly related to the maturity of the business, and it especially depends on the number of SKU in the inventory. So you really need to weigh the advantages and disadvantages of incorporating it into your business prior to getting it. Pricing Software is often better suited for more developed companies. Excel tends to be the better option for smaller companies, on the other hand, because in order for a Pricing Software to be a good investment, your store needs to have a sufficiently large enough monthly turnout than that of a younger company.
4. Difficult to select the right Pricing Software
It’s either a blessing or a curse to have many different Pricing Softwares available on the market, depending on the way you look at things. Although you’ll need to analyze many different brands of Pricing Software on the market, you can be confident that you will be able to find the one that is the optimal product for your company.
In summary, although both Excel and Pricing Software offer ways to input data, the latter definitely has more advantages than disadvantages. Pricing Software offer you more, save you more time and do many more processes automatically than Excel.