January 15, 2016 | Written by: Peter Wharton
Categorized: eCommerce & Merchandising
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We are all familiar with the story. Empowered by advanced mobile technologies and multiple digital channels, socially-connected, savvy consumers now shop on their terms. Picture the scene:
“It’s the New Year and I was determined to be healthier and encourage my kids to more eat fruit so I decided to buy a smoothie blender. I’d seen one selling for $75 at my preferred retailer store so decided to check their online site. I found it at the same price and put it in my cart but before purchasing thought I’d do a quick online search to see if I could get a better price elsewhere.
To my surprise I found the same blender priced between $65 and $70 at three other retailers, and one had a special offer for next day delivery service. It wasn’t the cheapest but with the expedited delivery, it met my requirements. With a couple of clicks I’d purchased the blender and the following day we were making healthy smoothies. My preferred retailer couldn’t compete on price and service. From now on I’ll definitely shop around.”
In online retail, you are just one click away from losing a customer. The digital experience they receive, the range of products offered, and the delivery service provided are some of the critical factors that influence their buying decision. However, you must first be competitive on price, which for retailers with both physical and digital stores, needs to be coordinated across your channels. Can you respond quickly to competitor pricing strategies and changing market conditions? Do you know which changes will impact your business and which can be ignored? If not then your customers will most likely shop elsewhere quicker than you can say “abandoned cart.”
Enter Dynamic Pricing.
Our cloud-based solution, launched in January, automatically and intelligently recommends online pricing actions based on real-time response to competitor price shifts and changes in market conditions. It empowers online merchants to reprice in real-time, sense and respond to outprice the competition, and in an omni-channel environment, bring together online and offline pricing decisions.
While price is critical, reacting to competitor price changes is not always the best course of action. Using IBM Dynamic Pricing retailers can intelligently determine which changes they should respond to (and how), and which should be ignored, all based on their potential impact on the business. For those that require action the solution automatically makes real-time pricing recommendations.
IBM Dynamic Pricing also helps omni-channel retailers avoid the price war by using data and insights from their physical stores to influence and price confidently online, allowing them to give customers the best price while protecting margin.
Find out more about Dynamic Pricing at Amplify 2016!