Pricing Strategies toHelp Online Retailers Soar
UP, UP, AND AWAY!
WHY DOES PRICING MATTER?
REPUTATION & BRANDING IMPACT ON SALES/PROFITS
Apple’siPhone 6
SamsungGalaxy S5
Nokia LumiaThe moment you make a mistake in pricing you’re eating into your reputation or your profits.
of customers cited price as the largest influencer on purchase
Katharine PaineFounder of The Delahaye Group
WHAT GOES INTO PRICING?
$299
$199
$99
HIGH
LOW
SUPPLY DEMAND
Decrease priceswhen you have
excess inventory
FAST DELIVERY
of shoppers want a delivery date early in the
shopping process
FREE RETURNS
of shoppers look at return policy before making a
purchase
FREE DELIVERY
of shoppers will add addi-tional items to their cart to
qualify for free shipping
PRICING STRATEGIES: WHAT WORKS AND WHAT DOESN’T
EXAMPLE
Having an original price visible as an anchor when an item goes on sale makes it more psychologically appealing.
ANCHOR PRICING
WHY IT WORKS
Shoppers feel like they’re getting a deal and are more likely to buy.
CHALLENGES
Mobile makes comparison shopping easier than ever: ⅔ of consumers use smartphones in store to expand their shop-ping capabilities.
ONE-PRICE POLICY
EXAMPLE
Unilateral Pricing Policy for large TV brands Samsung & Sony.
WHY IT WORKS
Helps eliminate showrooming and price erosion.
CHALLENGES
Sales are determined by the manufacturer, leaving the retailer with limited decision making abilities.
SEGMENTED PRICING
EXAMPLE
Target’s Room Essentials pillow selection are in the $0-$24 range vs. Target’s Threshold pillow selection in the $15-$49 range.
WHY IT WORKS
Deliver similar products for di�erent market segments.
CHALLENGES
Customers may not see the value in more expensive seg-ment’s products.
DYNAMIC PRICING EXAMPLE
Changing the price of headphones when tra�c is low late at night to increase conversions.
WHY IT WORKS
Changing prices based on external and internal metrics make it possible to price for profit and stay competitive.
CHALLENGES
Manually updating prices is costly in terms of time and money.
Retailers that are able to provideadditional value can charge a premium
SALE!
When new products come out, cutting the prices for the older ones
helps clear inventory.
HOW LONG THE PRODUCTHAS BEEN ON THE MARKET
Ex: Summer clothes are heavily discounted when
fall rolls around
BRAND 1
BRAND 2
$189
PRICE
$49SALE!
$37
63% 66% 58%
ADDED VALUE
SUPPLY AND DEMAND
$189
PRICE
$15
PRICE
$49
PRICE
Increase prices when you’re close to
running out
Lower prices when demand
is low
High demand products merit higher prices
84%
Learn more about how Wiser can automate and
optimize your pricing strategy.
W W W . W I S E R . C O M
I N F O @ W I S E R . C O M
1 . 8 5 5 . G O W I S E R
Sources:
AMA
Econsultancy
CNET
Comscore
