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The holidays are around the corner, but as an online retailer, that doesn’t mean it’s time to start sweating. Instead, it’s time to nail down your selling strategies to make sure you’re prepared for whatever comes your way. From out of stock situations to late deliveries, the holidays are the time when stakes (and sales) are usually the highest. Don’t let small oversights cost you a fortune. Instead, follow this short checklist to get your pricing and assortment in order just in time.
Assortment: Do you have it all?
Assortment is one of the main reasons many shoppers flock to online stores. To put it simply, you can find just about anything you want or need online. That means that your store needs to fit into that notion. Of course, you can’t realistically carry absolutely everything a shopper could ever think of, but one of the keys to the right assortment surprisingly lies in what your competitors already have.
No, you didn’t read that wrong. What I mean is that in order to be competitive, you must fill in the gaps in your inventory. When a shopper clicks onto your site, they are often looking for something specific and your store will either have the items or it won’t. That can certainly make or break the sale. When a particular retailer doesn’t have a product a shopper is looking for, 77% will go elsewhere.
Luckily, data saves the day when doing a gap analysis, which allows you to find out what products you have in common with your competitors and where you are unique. From there, you can create a plan of action for each of these types of items:
- Products you have in common: These will be the most competitive items and will require appealing pricing that makes shoppers commit to buying from you, instead of your competitors. This doesn’t necessarily mean you have to beat their price; you can also justify a price premium by providing value in another way that your competitor does not.
- Products only your competitors have: This is where you need to step up your game. Try carrying these products and see what impact it has on your bottom line.
- Products only you carry: Unique products give you the ability to charge almost any amount you want. As long as shoppers find the price acceptable, you have the license to set the pricing standard and enjoy the profit margins… until a competitor starts carrying it, that is.
Pricing Strategy: Are your prices appealing?
After you have all of the products a shopper is looking for, the next step is to make sure that your prices are appealing enough to get them to complete the checkout process. Did you know that 84% of shoppers cite price as the biggest influencer on purchase decisions? They need to like the price they see on your website or they’ll take their business elsewhere.
But what price is the right price? There are a few different answers to this question:
Turn again to your competitors
How are they pricing these products? Depending on your brand positioning, decide how you want to proceed. Luxury brands might want to price higher, value brands might want to be lower. You might even want to match their prices with limits, of course, to avoid a gnarly price war.
Pricing isn’t a one time thing
Once you set your price, you’ll need to update it often; the market isn’t static and your pricing shouldn’t be either. Behemoths like Amazon change their pricing sometimes as often as every 10-15 minutes. While Amazon might use this tactic to slash prices, you can also boost prices to optimize for profit by quickly reacting when a competitor runs out of stock. Some retailers are able to do this manually, but price optimization software is no longer a privilege just for the Walmarts and Best Buys. Retailers of all sizes are seeing the profit and revenue impact that comes from pricing that can keep up with the market.
Assortment and pricing are two of the main factors that will help online retailers win this holiday season. In order to be chosen from so many competitors, online retailers must convey a specific value that shoppers gain from your store in particular. Whether that comes in the form of low prices, free shipping, or an awesome return policy; how you present your store’s unique value to consumers will have a large impact on your ability to shatter the records you set in years past.
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