Retail Pricing models, Strategies & Rules

Retail Pricing Models

How to build a winning pricing strategy for an online store

Basic pricing models for eCommerce include cost-plus, value-based, and rule-based pricing.

Retailers use various pricing models to pursue different business goals such as to increase the profit, market share or turnover, among others.

The pricing models can serve as a basis for an effective pricing strategy for an online store.

Pricing models, Optimal retail strategies, Develop a pricing strategy

The Cost-Plus Pricing model is based on adding a fixed dollar or percentage to the product’s cost. This model does not require deep market understanding and is easy to apply.

The Value-Based Pricing model sets different prices for individual customers based on their perceived value.

The Rule-Based Pricing model uses specific predefined rules, which retailers set based on their business goals.

How to Craft a Winning Pricing Strategy

Effective eCommerce pricing strategies use the following rules:

1) An unreasonably high price diverts shoppers, especially in a highly competitive industry, e.g. electronics & computers

2) TAn unreasonably low price decreases margins and revenues.

The most balanced pricing strategies are primarily based on the customer price perception.

Competera dynamic pricing benefits

Optimal Retail Strategies

According to statistics, eight out of ten customers compare prices in at least two stores before buying online. Therefore, retailers willing to attract and retain customers need to collect competitive data about pricing, promos, and stock to set optimal prices and increase their revenue.

Benefits of Automated Price Monitoring Tools

Zero mistakes: unlike humans, machine algorithms do not make mistakes when collecting and processing data

Any amount of data: algorithms are able to analyze millions of prices

Scheduled delivery: automated solutions deliver data with customizable frequency

Competera’s Price Monitoring Tool for E-tailers:

  • Competera’s automated price monitoring solution collects, structures, analyzes and delivers competitive data by store, category, and product on a schedule.
  • The solution visualizes the retailer’s position in the market and provides pricing recommendations and actionable alerts about market opportunities.
  • Retailers benefit from a 24/7 technical and customer support.
  • With Competera, retail teams can switch from routine tasks to crafting a revenue-boosting strategy.
See how easy you can filter all your stocks by price alerts and competitors within Competera Products Report.

Craft an effective pricing strategy and increase revenue with Competera