Large retailers market their brands both offline and online. They’re using omnichannel strategies to increase customer reach, enlarge sales and maximize profit. This creates a multitude of opportunities – and challenges.
First of all, omnichannel retailers want their customers to enjoy the same positive user experience both offline and online. They want to increase customer loyalty. To do that, they strive to create similar brand power across all channels, which is based on specific values. So naturally, pricing also plays an important part. But how?
Different Channel, Different Price?
The connection between customer loyalty/satisfaction and pricing is complicated. On one hand, price is one of the first things that customers examine before making a purchase. Customers want to feel that the product they are purchasing is priced in accordance with their expectations.
On the other hand, that doesn’t necessarily mean that the same product has to be priced the same across different channels. In fact, while customers expect their favorite brands and retailers to price products fairly, that doesn’t mean that they expect them to price their online products similarly to their in-store products. Most customers expect a difference.
Many retailers price their products differently offline and online. That’s a fact. But customers have come to expect price elasticity not only across channels, but also across different days, and even hours. They have grown accustomed to prices being dynamic. Very dynamic.
Retailers can use customer expectations to their advantage. By changing product prices across sales platforms, they can enhance their image as a dynamic seller that knows exactly what their customers want, and when. When applied correctly, this flexibility can greatly enhance brand image. If a retailer wants to project cutting-edge values, pricing agility can be a great place to start.
The Power of Dynamic Pricing
Omnichannel retailers can use pricing as a wonderful opportunity for business growth. But the challenge remains: how can retailers price items accurately, when there are so many changing factors? The answer is dynamic pricing.
Manual pricing cannot handle the wide range of factors that must be taken into consideration in real-time – especially in omnichannel environments. That’s why many retailers are seeking to rely on automatic price changes, which effectively respond to a myriad of consumer trends, competitor actions, and more.
These frequent price changes are based first and foremost on specific pricing guidelines and strategies, which are applied individually to each sale channel. Once pricing borders are clearly defined, precise dynamic pricing algorithms can recommend the optimal price for each product, at every sales channel, while calculating specific days, hours and trends.
The expected results? Better sales. Happier customers. Enhanced image. And higher revenue.