Ever wondered what's the best way to track the price of your competitor for your eCommerce business? Here's our blog that discusses nine tips that will help you achieve this objective with minimal fuss. Think about ignoring this write-up at your own perils.
The competition is wild in ecommerce business. If we take the emerging markets into the consideration, we can see that the growth rate and investments are also raising the bars of competition. With the increase in the number of price comparison engines, the users now have access to many different options. This shows how suppliers are fighting for any demand in this very competitive market.
Pricing is a game changer in this wild competition
Since online shoppers have easy access to any shop in the world, finding the best deal is not that difficult. As a consumer you just have to check few more sites. And they are only a few clicks away!
With this change in consumer habits for finding places to shop from, the ecommerce companies need to change their ways of marketing as well. So to attract customers, companies usually have ‘best price’, ‘best value’ etc. in their taglines.
With such a dynamic market it gets difficult for the company to offer actual ‘best price’. Claiming best deals needs science backed studies in pricing and continuous analysis of all the prices competitors offer online. And this manual analysis would take forever considering all the online shops.
Not only time is wasted but also the company must hire people to check every competitor’s website and get every single price for each of the product. With the competitive intelligence being very critical in the market it seems a good investment to hire people just to get the prices checked.
However, this very repetitive manual data gathering and entering task becomes infeasible for the employees since there are nearly a million active e-commerce companies worldwide. With this emerging need now there are new breed of business intelligence tools that offer automated competitor price tracking.
As this automation helps companies reallocate their resources into other important needs such as marketing, the ones who are still doing this manually, or not doing anything at all fall one step behind in the competition.
Steps Taken Before Automation
For the automation to create the insights needed, a proper, well-crafted human inputs must be entered in all business intelligence applications. We can rephrase this sentence as “requiring initial guidance” from the user. The two important factors which need to be clear for the tools to work properly are:
Who are my competitors?
Which one of them should I to track?
What are my most important products?
Which of my products are most competitive in the market?
Which of my products are the most price sensitive?
If this questions have answers coming from prior market research, then the answers can be easily fed into the tool and yield the optimum outcome.
1. Competitor Identification
To many shops to compare from!
Answers for these questions are critical. But most of the time a company already knows their competitors. Usually, the problem is with keeping track of the price and stock information of every single online shop that sells the exact product. Yeah, you can check Google to see some of the prices. But are you going to do this few times everyday? And how can you be sure that there are no other companies in the other pages that sell for cheaper price?
Just looking at pages on Google might not be a smart way. Google also offers Google Shopping to compare prices like some other comparison engines you can find online.
Prioritizing the competitors is a critical step. To determine which web shops to think as the main competitors you may consider these two factors:
a) Web traffic performance b)Revenue performance
To collect data on web traffic a good method is to see the rankings on Alexa or SimilarWeb of those competitors to see how they are doing in the market.
Now, it is important to identify your most price-competitive products or SKUs (i.e. price elastic in economic terms). To do this it might be a good idea to filter the top 1000 or 5000 SKUs with the largest sale volumes or using a simple Pareto rule of 80-20 can also be applied on the full assortment. The company must pick their products to be tracked. With many eCommerce companies using such automation in competitor tracking, tracking only the top products rather than all SKUs (which are sometimes more than 10K) helped them not to get lost in too much data. This cropping yielded in faster gains for these companies.
3. Getting URLs
Now that you know your competitors which sell your selected products, you will need the links of these products on your competitors’ websites. With these URLs you will be able to see the price and/or stock availability information.
However, this process requires manual work. But the good news is that this is a one-time task. Then the program will take care of the rest. This task can sometimes be outsourced to the service providers. It can sometimes be semi-automated too depending on the vendor’s technological stack.
4. Getting Automated
After determining competitors and the products to be traced and providing the links, rest is full automation! The tool will visit each site and get all the information needed, such as price and stock availability with some frequency. It will also create reports with the results of the analyses.
With this full automation, the company will save a lot of time and won’t need to have a dedicated employee for this work. Instead, now the company can give more important jobs for that employee.
An automated solution for tracking competitor prices would remove this repetitive work of manually checking each product on each site. And leave the company with the results of the desired results within very short time and with almost no effort.
The tools that would be beneficial for companies must also have some specific features for the best results:
Updating price and stock availability information frequently
Being applicable on any country and any website without any barriers
Delivering user actionable alerts and reports
Providing C-level or more compact reporting
Offering an API for further integrations with other tools the company uses
5. Frequent updates
The market is very dynamic and prices and stocks are changing every moment. So actually the frequency of the checks is the most important feature the tool should offer. Multiple updates a day should be expected from the tool.
6. No market coverage barriers
As with every other program, the tool might get caught up in technological limitations. Some price tracker tools might only cover Amazon or Google Shopping or some markets that are specific to either a country or ecommerce verticals. Fortunately, there are tools that can cover any market vertical from any country. So a company must be careful with this detail when choosing the tracing tool and choose the latter version if wants to trace without limitations.
7. Actionable alerts/reports
Well, the ultimate goal of the business intelligence tool should be reporting of competitor’s price changes instantaneously. These changes should be alerted by special notifications which can be configured from the admin panel of such tools. It may also allow different members in a team to control different brands or categories. This means another important factor when deciding on a price tracker is if it allows role-sharing in a team.
8. C-Level or more compact reporting
These tools can be important for executives at different levels as well. The tools clearly increase the effectiveness and efficiency of the action-takers of pricing decisions. In addition to the action-takers, the reports will provide higher level executives with more crucial insights about the performance of the company. Since these tools provide historical trends with respect to categories and brands, price managers can see the relative performance of the products or brands. They can also set KPIs for the pricing decision maker employees.
9. An API for further integration with other ecommerce tools
Businesses use many other tools that answer their needs. And the needs never end. Businesses will continue to use many applications. So a business tool must allow further integrations with the other tools that a company would use. It is important that a price tracking tool offers automated feeds or APIs that can be integrated with other tools.
Summing things up,
We can talk on and on about the benefits of such price tracking tools. But to finalize, these tools will help the company allocate their precious time spent on tracking the prices to actually thinking of strategies and actions that can be taken with the results of this operation.
It is also possible for small or mid-sized e-commerce companies to use such tools with very affordable monthly fees thanks to fully automated, cloud-based tools.
As it is the case in the digital disruption of retail through e-commerce, competitive intelligence is also facing a major disruption. And it’s also starting to be packaged as a SaaS solution instead of an expensive conventional market research service or reporting.
With this guide on what factors to consider when choosing a price tracker tool, and how you can benefit from it, it comes to choosing one. To choose we, Prisync team, would recommend trying out the tools available and choosing the best that fits your needs!
Sawaram Suthar is the founder of TheNextScoop and Jagat Media. A digital marketing consultant, he has experience in branding, promotions, page optimization, research, and strategy. He has an MBA from the University of Pune. Anyone can find him on Twitter @sawarams.