The introduction of various technologies created a boost for online shopping. It is a time when consumers choose their purchases carefully and often appeal to different competitors to get the best price. Luckily, there are instruments like price comparison software allowing to translate data into better pricing decisions.
With the arrival of e-commerce and mobile technologies, it became extremely easy for people to shop online. Besides, the recent COVID-19 pandemic created the conditions where people started to appeal to online shopping as often as ever before. In this article, we’d explore the role of price comparison software in companies’ battle to get the most customers.
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The definition of price comparison software
In simple terms, price comparison software is an instrument allowing companies to find the prices of competitors and compare or align them with any given product within their portfolio. The software is often presented through the scope of three key factors: speed of processing, data accuracy, and functionality.
Various price comparison tools are vital for retailers. When firms use market-based pricing or any other competitive pricing strategy, they solely rely on understanding their rivals to present the best prices for their products. The knowledge of competitors allows retailers to always be one step ahead of the game. Tools like price crawler use advanced algorithms on the foundation of Artificial Intelligence and Machine Learning to find the key differences in pricing among competitors for the selected product portfolio.
How to work with price comparison software?
Essentially, in the right conditions, a price crawler can be a game-changer. Yet, to get the most of it, one should understand its flow. To aid competitive pricing or market-based pricing, price comparison software needs to be delivered in certain stages to benefit from competitive or market-based pricing. Respectively, they correlate with gathering data and matching it across competitors to get some output that can lead to pricing insights.
Usually, the first stage correlates to finding the proper data sources. It means that you need to understand which competitors influence your pricing and which don’t. The second stage is about collecting data on aspects like images, titles, units of measurement, and descriptions. The further phase corresponds to delivering data to the stage one works with. Finally, the data should be verified and correlated to an existing business objectives and pricing model.
Price comparison software works with data graning many valuable insights. It can be proceeded with Machine Learning systems to make sense of what competitors are doing with their prices. There are several things you can learn from gathered data points, for instance, the following:
- You can find out the competitors that directly impact your prices.
- You can establish the recommended prices for your products in a portfolio.
- You can offer your team insights helping to increase sales margin.
- Considering all these, price comparison software is crucial for retailers, especially when coupled with competitive and market-based pricing strategies.
- Selecting the proper price comparison software
- As with any given strategy, for instance, dynamic pricing, it is important to know how to choose the selected method to work with it. The same is true for price comparison software. When it comes to choosing the tools, focus on four key areas:
- The quality of data. Price comparison software works with loads of data. Naturally, you need to ensure that the software you intend to use works with accurate and correct data points. Usually, it can be checked by appealing to the data rate percentage. Everything that comes below 90 percent should be considered as not enough. The quality of data is paramount, and it must not be neglected when choosing the right price comparison software.
- Service legal agreement. One should read the legal service agreement before buying the software or collaborating with a company offering it. It is vital to know the price comparison tool to a great extent. You can check its quality, delivery, accuracy, and customer support. Fitting the legal service agreement ensures that you know all the pros and cons of the selected price comparison software.
- Optimization and interface. It is hard to use a tool that does not have an intuitive design and is challenging to navigate. One of the key purposes of price comparison software is to grant you valuable insights when working with massive volumes of data. Without an easy-to-use interface, it is extremely difficult to accomplish. You need to check how easy a selected price comparison software is to use. If its design and interface are complicated, it should be considered a major red flag.
- Profitability. Price comparison software should bring revenues. Respectively, it can be achieved when the tool can be seamlessly integrated into your pricing strategy. So, when selecting the price comparison software, check whether it works with your primary pricing strategy.
The abovementioned factors help you choose the right price comparison software. Follow the guidelines, and there is a high chance you will have a proper tool in your hands.
Does your business need price comparison software?
Simply put, there are no retailers that do not need the power of price comparison software. Considering the rise of online shopping, the importance of the tool has risen as high as ever before. The good news is that retailers appealing to e-commerce benefit from price comparison software. For instance, they can monitor competitors to understand better the existing demand, the market, and the competitor. As an outcome, the retailer will have strategies to boost customer loyalty and attract new consumers.
The evidence offered by Statista suggests that in 2020 about 2 billion people will purchase products and services online. In general, e-retail sales surpassed the staggering number of $4.2 trillion in 2020. At this point, referring to the relevant statistics, price comparison software is a direct way for your business to get a chunk of that massive pie.
Final recommendations
Price comparison software is there and should be used. However, when approaching the tool, remember why you need that, when coming to the tool and how to select it properly. Don’t forget that data quality is vital for any given price comparison software. Align it with your business objectives and pricing strategy, and it will offer you valuable insights into competitors and ensure revenue growth.