Explore the role of price comparison software in determining the best pricing strategies a company can find on the market.
It is no secret that consumers check the prices of products by different companies when making a purchasing decision.
Essentially, the numbers indicate that about 70% of people shopping online prefer checking and comparing prices and reading reviews of the given products.
For retailers, competitive pricing is something firms cannot avoid. By offering prices better than those of competitors, one can direct consumer behavior in a certain direction.
The essence of price comparison software
Price comparison software is specifically designed to locate particular prices utilized by competitors for a given product in a portfolio. The phenomenon is generally presented through the scope of three key aspects:
Speed, accuracy, and functionality. These factors make price comparison software effective in using market-based pricing strategies for best pricing.
When a company has an accurate and correct knowledge of competitors, there are conditions for being one step ahead of rivals. In such situations, retailers can react to competitors’ price changes accordingly and stay competitive.
Choosing the proper price comparison instrument is vital. There are a number of such tools available on the market. For instance, one can consider following price scrapping tools, which use advanced algorithms to bring the most effective pricing strategies to retailers.
Price comparing software functionality
Competitive pricing is often determined by a company’s ability to use innovative techniques to understand competitors’ pricing strategies better and align personal business objectives accordingly.
Instruments like price scraping tools are often described in several key aspects or stages. Essentially, there are five of them:
- Input
- Integration
- Matching
- Collecting
- Output
The stages correspond to the data collection and comparison process enabled. When comparing prices based on the data presented, companies can use images, titles, and descriptions for more accurate outputs.
Furthermore, every given data point received should be verified. As a result, the most valuable insights are retrieved from data stores, and retailers receive opportunities to find out about real competitors and establish recommended prices for new products.
Selecting price comparison software
As mentioned before, with the development of advanced pricing methods, new instruments arrived. Many software companies are working on developing the most effective price comparison software.
In such a case, retailers can choose among various options which represent an issue. One should always remember that not all price comparison software is similar. At this point, it is crucial to find out how to select the best price comparison software.
1. Check the data:
Collecting and analyzing data is the central aspect of any given price comparison instrument. It is one of the most important factors and should be carefully approached.
In such a case, take your time to find out the degree of data accuracy offered by the instrument. A rule of thumb dictates that a data rate of about 90 percent is considered a sound option to consider.
You should assume that even the slightest deviation in data accuracy can mean an incorrect comparison of thousands of products, leading to false decision-making.
2. Read the Service Level Agreement (SLA):
Checking the SLA is vital for understanding the exact terms and agreements for using the selected price comparison software. The stage is about exploring aspects like quality, delivery, and customer support.
At this point, you can ask the following questions: What is the minimum or maximum data accuracy rate promised by the software? Does the SLA offer a pay-per-use model? How accessible is the customer support service? These questions help navigate the SLA agreement.
3. Explore the tool’s user-friendliness:
One of the key goals of price comparison software is to preserve costs and save time. If a presented software is hard to use and is time-consuming in terms of learning, users will often find it extremely difficult to navigate the tool.
It is considered one of the primary red flags in choosing price comparison software. It should come with a user-friendly design and toolbar, allowing users to navigate it effectively without prior knowledge and experience of employing the software.
4. Find out the degree of profitability:
As mentioned above, price comparison software should help you make money. The selected tool needs to be integrated into your chosen pricing strategy.
Otherwise, you’ll find yourself in the position when you invest in software with too much money and no potential returns.
Following these factors can be a game-changer. It is worth paying attention to certain aspects rather than finding yourself with software that does not meet your needs.
Value of price comparison software to business
When used properly, price comparison software can offer massive benefits for businesses. Yet, you should understand that software should be aligned with the current pricing strategy employed.
Most often, retailers use a dynamic pricing strategy. There is a guide to active pricing strategy, which can be useful for you.
Along with effective pricing strategies, price comparison software offers a competitive advantage. It is extremely important when online shopping is skyrocketing.
Reports suggest a strong shift to online shopping as lockdowns first confined people, and then many continued to work from home. Respectively, retailers using e-commerce can be expected to benefit from price comparison software the most.
When it comes to more specific software benefits, one can offer an example of MAP. With the instruments, companies can monitor their MAP to ensure the loyalty of consumers and the fact that a firm provides some unique product. Besides, the software presents data showing a complete picture of a market.
Conclusion
Price comparison software uses modern technologies to make pricing strategies as effective as before. To get the most out of the instrument, it is necessary to understand the stages in which the tool is implemented.
Besides, one should clearly comprehend how to select the price comparison software. When all these elements are put together to work, you receive the software that offers the pricing approaches your company needs,
