“Vodafone follows the example of Telefónica and Orange and increases its rates.” “Netflix may increase its rates due to changes in its competitors.” News like this, which we see in the media every day, testifies to the importance of watching competitors’ prices for brands, and the need to adjust prices according to the movements of competitors, without making any mistakes.
Brand positioning basically determines the prices of the products. And as we know, the price is the first factor in the purchase decision for most customers. But is the price really only based on brand positioning? To what extent do other more objective aspects, such as product quality, intervene?
Often the quality perception of a brand, like Apple for example, can cause customers to perceive all products of the brand as the best in the market. But is the iPhone really the fastest smartphone on the market? And does it have the best image quality? Some such questions are questionable, but this does not prevent the brand from being perceived as one of the best in the world, a value that is reflected in the pricing policy that ultimately determines the prices of the other brands in the industry.
A question of perception and comparison
The brand perception of the workers and owners of a company is not the same as that of the customers of this brand. There is no point in considering yourself the ideal car brand for young city dwellers if they prefer to buy another car after obtaining a driving licence. Therefore, it is fundamental to investigate how a brand is perceived. Are there many complaints in social media? Bad reviews in the website regarding the last promotional campaign of a product? Indications that prices are too high in comparison to the quality perception or in direct price comparison with the competition? Then it is time to change something.
Social media has broken the barrier between brand and customer, and gives a clear indication of what the user thinks of the brand and product. In addition, the followers of a brand on social networks are influenced by the comments and preferences of their friends. It is therefore very important to respond to these criticisms and comments as quickly as possible. Proximity and accessibility to clarify any doubts customers may have during and after the purchase significantly improves brand perception. The point is that the brand justifies the price, not the other way around.
A dynamic pricing strategy makes it possible to adjust the prices of different products in real time according to market changes. This can be done very easily with the help of a competitor price monitoring application. This ensures that the product the customer is looking for is available at the right time and at the right price.
The automation of the comparison process allows a continuous price update and prevents missing sales when a competitor suddenly offers his products at a much lower price.