In an era of information floating, customers are becoming more and more price sensitive. They starting to compare how a product’s prices vary in-store and online. Without an intelligent pricing strategy, you might risk losing your customers.
In fact, statistics show that retailers with an effective price list strategy see a 2-5% increase in their bottom line. In this article, we’ve discussed some of the most critical factors and pricing strategies for various media.
Price awareness and customer perception
Customers don’t just look at the price of a commodity when making a purchase decision. Other considerations include its availability (can I get it right now or do I have to wait?) and its practicality (can I shop online or do I need to go to the store?). In other words, you should weigh these factors rather than simply attempting to deliver the lowest price on any channel or using end-all and be-all prices.
Amazon Prime members, for example, were found to be more tolerant of stores whose online prices are higher than in-store prices. This is due to Amazon Prime members placing a higher emphasis on the ease and pace of shopping online than the average user.
Implement various pricing strategies across channels
Getting the price right is a fine art, in which testing and learning are essential components. Business decision-makers should constantly track and optimize costs based on what works and what doesn’t for each distribution channel. Taking into account things like:
- Costs of production and distribution
- Offers from competitors
- Brand positioning strategies
- Your intended clientele
- Your unique selling points
Keep in mind that those factors can vary significantly from channel to channel, so there is no one-size-fits-all approach to multichannel pricing. However, you can determine pricing boundaries and optimize profitability by being agile and monitoring performance by the canal regularly.
Provide staff training on pricing techniques
It’s critical that customer service representatives are educated on dealing with questions regarding price differences between online and in-store. You should avoid answers like “I’m not sure – I’ll just give it to you for the lowest price,” or “I’m not sure – I’ll just give it to you for the lowest price.”
When a customer asks about prices in-store, on the phone, or via chat, customer service representatives should be mindful of the price differences and prepared to discuss why (the cost of holding stock in a retail store is higher than selling it online, for example).
Responses should be checked and optimized based on what consumers ask and how pleased they are with the explanation, much like the pricing strategy itself.
As previously stated, there is no one-size-fits-all pricing strategy that will produce the best results for any business. It takes time and effort to perfect an excellent multichannel pricing strategy.