Practically since ecommerce via the World Wide Web began, automated price monitoring tools have been used. The end customer has used price search engines and price comparison tools practically immediately in the B2C environment. Every online retailer knows what difference a first place at Idealo or guenstiger.de can make for online shops. Slipping down to second place can cause the quantity structure of an online trade to collapse. So that one does not overlook such circumstances with large assortments, on-line dealers use routinely already for years Tools, in order to supervise the price settlements of the competition. If a price change is reported by a pricebot, it is possible to react practically every second. Often automated (ideally rule-based) price changes are made. This mechanism does not always have to be accompanied by falling prices. Good providers of price monitoring software have also implemented rules that demonstrate the scope for price increases (repricing).
Price monitoring with software support saves time
A (not representative) expert survey among ten sales managers of manufacturers of consumer products by preismonitoring.com showed that activities directly related to price monitoring take between two and seven hours of weekly working time.
Typical statements were:
- “In a browser window amazon is actually always open.”
- “We checked daily for idealo what was happening at the front.”
- “Every day we receive calls from angry traders asking us to finally discipline ourselves.”
- “The research and documentation of price changes in Excel is an annoying diligence exercise.”
How the world of sales managers is changing after the introduction of price monitoring software could also be determined with the help of a survey of an expert panel.
- Since we have been supported by software, we save a lot of time per week, which is better spent on the actual goal-oriented work.
- The software not only allows you to control your own prices, but also to keep an eye on the competition. This also helps us to develop a better understanding of our own channel when the competition is out of control.”
- Systematic price observation has sharpened our senses for a sustainable price policy in the first place”.
- “We now have our prices and the prices of our competitors’ products at a glance.”
Price research tools are not an end in themselves, consequences must also be drawn.
Data acquisition is one thing, the implementation of a pricing strategy another. If a bot recognizes that a market participant is “destroying” the price, then it is not enough to stare at the price chart as if paralysed. It must act in the interest of all customers and partners in the sales channel. The price discipline must be acted with all (legal) means of fair competition. This process should be enforced with harshness and consistency.
Particularly in online trading, manufacturers have their “thumbscrews” to bring their dealers into line. If necessary, you have to withdraw the rights to use the pictures, deliver them more slowly, increase minimum order quantities or refuse to take back the returned goods. Surely you know even more “little games” about how to ensure price discipline.
In the long run, a strong sales channel from (online and offline) is existential. If at the end of the day only price aggressive big players survive and the industry only faces a few players on the sales side, then it is too late.
Conclusion: A wise pricing policy also serves the competitiveness of one’s own customers. In order to implement such a policy, price monitoring software is needed. Interestingly, many farsighted online retailers are already urging their suppliers to monitor prices. Preismonitoring.com even knows about online merchants who no longer list suppliers – who still ignore such tools.