Wednesday, November 14, 2012

Competitive Pricing, Hour by Hour

With the holiday buying season almost in full swing, retailers recognize that consumers are doing more comparison shopping than ever before.

Shopping search engines like Nextag are still popular, of course, and offer marketing opportunities for retailers to reach consumers who are trying to make a buying decision.

Retailers are using sophisticated technology from Mercent and other firms to monitor competitors' prices and, if necessary, adjust their own prices--daily, hourly, or whatever it takes to remain in contention.*

To quote Mercent's CEO: “If your competitor re-prices daily and you do it hourly, for 23 hours a day you are in position to own the [purchase] decision.”

Stores are also price-conscious, keeping an eye on their competitors' tags. Nebraska Furniture Mart (above), owned by super-investor Warren Buffett's Berkshire Hathaway, keeps abreast of competitive pricing and changes as many as 800 prices every day. Remember those printed shelf price tags? Gone, replaced with electronic e-ink tags for clear and up-to-date prices in all of the branch locations.

* According to today's New York Times, online prices over the Thanksgiving weekend were changing hourly at Amazon, Walmart, and Target, sometimes by a matter of pennies, so that one retailer or another could trumpet the absolute lowest price on some popular item.

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