Running a successful eCommerce operation today is a fast-paced, dynamic process. Not only is the competitive landscape constantly evolving in almost every industry, but so are the consumer trends and technology that drive it. If your eCommerce business does not have the right tools to keep up with these changes and respond accordingly, then you risk significant losses in both market share and revenue.
This is where automated dynamic pricing comes in. A good price optimization solution will help your company instantly determine the best price or promotion to offer at any given moment based on a number of factors including: seasonal demand, customer location, and the prices your competitors are charging. When executed properly, these solutions enable you to achieve your sales goals and optimize your profit margins even in an extremely competitive market.
Imagine being able to run several geo-targeted sales campaigns simultaneously where visitors are shown different prices and promotions that are optimized to their physical location!
Dynamic Pricing Will Soon Be the New Standard in eCommerce
Before you start thinking that you can afford to wait on this “new technology,” the truth is that many of your competitors are probably already using some form of dynamic pricing, and even if they aren’t right now, they will be soon. It’s well-known that big online retailer Amazon.com has been constantly changing the prices on its products for years to maximize numerous market variables and trends. The same is true for big-box retailers like Target, Walmart, and BestBuy.
But, as dynamic pricing software solutions have become cheaper and easier to set up and implement, it is allowing even small and mid-sized eCommerce businesses to conduct sophisticated personalized promotions and pricing strategies.
The Benefits of Geo-Targeted Pricing Optimization
So, how can your business in particular profit from implementing a location-specific dynamic pricing solution? Here are three key benefits to consider:
You can compete with local, offline retailers. Mobile eCommerce has been growing in leaps and bounds over the past few years, and the result is that an increasing number of consumers may be browsing your website while they are in the physical store of your offline competitors. With dynamic geo-targeted pricing you can show these people the product they need at a cheaper price then they see on the shelf.
The automated process reduces manual input and mistakes. With automated pricing optimization, you can make instant pricing decisions with minimal manual effort. You can also reduce a number of pricing errors, such as pricing a product either unrealistically too high or too low or mistakenly entering the wrong prices on products, for example $19.99 when you meant $29.99.
Instantly analyze and act on a big data set. A good dynamic pricing solution will be able to consider a large amount of data points and be able make pricing changes in real-time. Not only will smaller eCommerce businesses benefit from the speed of these pricing changes, but also in the cost-effective context in which they are happening.
In short, automated dynamic pricing is definitely one eCommerce trend that you cannot afford to overlook in 2015. If you would like to see how geo-targeted pricing optimization can work for your company, at Darwin Pricing we offer a forever free dynamic pricing application. After going through the quick set up process, our app allows you to configure geo-targeted sales campaigns on your website right away.