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These three fundamental shifts are calling for a new approach to retail
pricing practices, an approach that can address the growing importance,
complexity, and volatility of competitive pricing.
This eBook reveals how successful retailers stay ahead of the
competition by using competitive intelligence and pricing data to
maximize margins and profits.
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Cost data
Product cost information is fundamental, allowing you to understand what your
margins are for each product and where you need to take action to maximize profit
opportunities.
Sales data
Cross referencing competitive pricing information with sales data allows you to
understand the real impact of competitor prices on your business. Armed with this
information, you can better pre-empt and respond to the moves of the competitors
that really matter. It also allows you to identify low converting items that may
require more competitive pricing.
Inventory data
Keeping an eye on inventory levels and velocity allows you to adjust your pricing
decisions accordingly. It allows you to identify items that are performing below
expectations due to non-competitive prices. At the same time, you may be able to
raise prices and capture higher margins on products that are low on inventory and
hard to replenish.
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Fast moving vs. long tail items. While high volume items
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INTRODUCTION
Challenges and
opportunities
GROWTH
Increasing sales and
market share
MATURITY
Maximizing margins and
profits while retaining
market share
penetration strategy
DECLINE
Identifying end-of-life
products
Markdown
management
Smarter decisions
you can make with
competitive insight
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Your eCommerce
Website
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MARKET ANALYSIS:
Price volatility in office supplies
To understand how the top office supply retailers manage their prices, we looked at 1,462 office supplies products sold at Amazon, OfficeDepot,
Staples, and Walmart over the period of Jan 21st Feb 21st 2015.
Increased
Prices
Decreased
Prices
Total Updates
Items Updated
%
Changed
Avg. Changes
per Item
officedepot.com
153
97
250
195
13.3%
1.3
Staples.com
221
192
413
173
11.7%
2.4
Walmart.com
1726
2565
4291
1237
84.6%
3.5
Amazon.com
1571
2086
3657
863
59.0%
4.2
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MARGIN OPPORTUNITIES
In most
companies,
10-20% of
base prices
are significantly
out of line
VOLUME OPPORTUNITIES
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Maintain your prices in sync with your competitors in each category (e.g., no more than
2% above or below the top 5 competitors).
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Case in Point:
CHALLENGES:
Pricing used electronics can be challenging because there are not always clear
benchmarks. Certain item may be older or have a unique condition, Biles noted.
Because the electronics business can be highly commoditized, a pennys difference
in pricing can have a significant impact on sales, according to Biles. However,
retailers always need to walk a fine line between providing compelling and
competitive pricing while also protecting profit margins.
Marketyze allows us to be
more automated and
up-to-the-minute, but also
dig in more and make sure
were protecting margins.
It has helped us build a
more profitable business
that also delivers more
value to the customer.
SOLUTION:
The Secondary Markets Division of Best Buy has experienced a surge in sales
and satisfaction since partnering with Marketyze, a pricing intelligence software
company, to keep a constant pulse on the electronics landscape.
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Contact us for a
complementary
analysis
Tel: 650.209.6610
info@marketyze.com
www.marketyze.com
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