With Black Friday and Cyber Monday still fresh in our minds and only a few weeks left in the holiday season, it’s time to reflect on the difference that real-time competitive intelligence can make to a retailer’s fortune. Here are three takeaways from this year’s holiday shopping season:
- Pricing in time – Retailer use of dynamic pricing was at an all time high this holiday season and we expect its use will continue to accelerate in 2017 and beyond. On average this holiday, we observed that Amazon changed their prices at least once a day on 15-20% of a sample of 1,700 SKUs, including 20% on Black Friday and 22% on Cyber Monday. Without access to real-time price intelligence, you’re relying on outdated information to make sub-optimal decisions at best, and harmful ones at worst;
- Availability fluctuations – Toys is always a top holiday category and everyone (along with their parents) can remember that one “must have” toy from their childhood. We tracked the online availability of different retailer top Toy lists at the start of November and found out-of-stocks up to 32% of the time. Without real-time insight into competitive availability, you may inadvertently and unnecessarily be price matching to the detriment of your own margins. And if you are lucky enough to still have this season’s “must have” Hatchimals in-stock, you know there’s lots of margin to be had.
- Understand the marketplace – In Q3, Amazon reported that 50% of its global units sold were from marketplace sellers. And, of the 7,690 Cyber Monday deals on Amazon.com, 80% were offered on marketplace products according to One Click Retail. Walmart recently acquired Jet.com for the lofty sum of $3.3B USD largely to further its own marketplace ambitions. Then there’s Google Shopping, which is in effect one big marketplace. As marketplaces continue to gain momentum and become a legitimized retail channel, retailers are faced with a whole new breed of “co-opetitor” to make sense of. However, not all marketplace sellers are created equal – some are more legitimate competitive threats than others. Discerning between the two is only half the battle, keeping tabs on legitimate competitive third-party sellers in real-time is the other. Walmart learned this the hard way back in November 2014 when its new price match policy included marketplace sellers and after a few high profile scams, Walmart quickly backed away from matching marketplace vendors. Fast forward two years, and Walmart’s much-touted “Dare to Compare” holiday campaign still omitted marketplace sellers – a blanket policy which may no longer be appropriate to drive shopper conversions.
Real-time competitive intelligence including complete marketplace visibility presented to merchandisers in the context of their store pages helps quickly identify and remedy pricing problems that are adversely impacting conversions and highlights opportunities for price and margin increases. IBM Watson Commerce ecosystem enables you to embed 360pi real-time competitive intelligence with your IBM Watson Commerce Insights merchandising workspace for competitive insight and intelligence where it’s needed most –with your products and categories.
Attending NRF – Retail’s Big Show in January? Stop by the 360pi booth (#815) to learn what real-time competitive intelligence can do for your business or visit the IBM booth (#1720) to experience how IBM Watson Commerce is leveraging 360pi competitive intelligence to change the way online merchandisers work.
Happy holidays, I hope to see you at NRF in January.
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