An overview of Competitive Price Intelligence (Price Intelligence, Price Monitoring and Analytics). Includes a history of competitive price intelligence and new solutions for retailers and manufacturers.
Welcome to this Overview on Competitive Price Intelligence brought to you buy Gazaro.
If you’re unfamiliar with Gazaro, then as an introduction we are facilitators of sustainable commerce – and we accomplish this by providing both consumer and business markets with price intelligence solutions in the form of our leading deal-finding service Gazaro.com and our PriceIQ Competitive Price Intelligence Solutions for retailers and manufacturers.
Gazaro is an award winning company that has been featured in some of the top industry publications for consumer electronics including PC world and Gizmodo.
Let’s get going – to define Competitive Price Intelligence or CPI you really need a primer on the history of retail, shopping, technology and the macro-economic factors that have come together over the years (next slide)
To create the perfect storm of variables that have forced retail to evolve, which in turn has brought about a need for Competitive Price Intelligence
Let’s start with a history of shopping and the consumer’s role within the buying process. Historically price visibility or how prices were established, was limited to the seller of goods and services.If you needed to make a purchase you went to market place, shopping hub or local store. You also had the option of buying from door-to-door salesman. Things began to change in the late nineteen century through Aaron Montgomery Ward and then Sears with the invention of the mail order catalogue. None-the-less, consumers still had little visibility into pricing and any deal knowledge was limited to advertisements, in-store promotions and word-of-mouth.
If you consider that shopping is really a negotiation between buyer and seller – and side with the most information has leverage and therefore wins…. Retailers and Manufacturers had quite a long winning streak in this time period. For those retailers and manufacturers, life was simple and good…They had powerful brands, very simple and manageable distribution channels, and very little ambiguity existed with respect to who was their competitor or how many competitors they had.
But the status quo began to change in the late nineties, And a power shift has occurred…..
Ubiquitous and fast internet, both home and mobile, e-commerce, deal finding tools like Gazaro along with social networking sites have gifted consumers price transparency which is the ability to know exactly what a product should costs and who has the best price…..
With the ecommerce boom, traditional channels changed as everyone began selling direct to consumer – manufacturers like Dell and Apple sold direct to consumers through a multitude of channels, and retailers began developing their own private label brands and selling both online and offline. This significantly increased the competitive landscape and complicated the traditional and simple supply chain.
In addition, new retail models also evolved as volume discount stores and online only stores entered the fray….. many retailers also began expanding beyond selling a specific category of goods to selling just about everything…..now you can walk into many retailer stores buy groceries, jeans, a TV, a couch, all the while having your car tires rotated and your engine oil changed….
Add in macroeconomic factors like high unemployment and the rising cost of living…..and you have, according to a 2011 Accenture survey, a consumer environment where price is now the single biggest factor influencing purchasing decisions…..which means that for may retailers who employ the strategy of maximizing profit per visitor….this is occurring
Customers are comparing prices in real-time while walking store aisles…… leaving behind countless shopping carts and taking their loyalty with them… just how much of this is going on? According to Kantar WorldPanel Comtech, 13.31 Million smartphones were sold in the US in the first quarter of 2011 alone, bringing the total number of U.S consumers who own a Smartphone to 69.5 million. Meanwhile, a recent Deloitte survey indicated that 2 out of 5 of those owners check prices in-store via smartphones when shopping, which means approximately 28 million consumers are walking around brick and mortar store comparing prices in real-time.
If you recall my earlier point about how the person who ‘wins’ in a negotiation or transaction is the one with the more accurate information at their disposal, then the person (in this case) the consumer currently holds the all the advantage…….
Before moving forward, let me summarize what we’ve covered so far:Consumers have gained price transparency….and retailers and manufacturers have lost it….to compound this loss, consumers are increasingly becoming more price sensitive and the competitive landscape has grown fierce…..These have all resulted in higher rates of eroding margins for retailers…….
What could retailers do to curtail this power imbalance……Some companies have began taking a more scientific approach to pricing, combining an internal understanding of operations through consultants and data mining, with information captured from the market and external environment through competitive price intelligence….The latter proving to be the most difficult to capture.
Now that we have a bit of context – we can define CPI as…..
CPI has been around for quite some time, and historically has involved retailers and manufacturers browsing competitor advertisements, flyers, promotions, competitor websites, and sending teams known as “feet-on-the-street” to walk store floors and gather data….
This rudimentary form of CPI is easy to do for 1 product and 1 or two competitors, but becomes costly from a time and resource perspective as you scale up. As a result this form of CPI unreliable when you take into account that in the time required to research, gather, analyze and share the information - your competitors who would be moving on to the next sale and promotion.It doesn’t have to be, CPI is fundamental to increasing an organizations Price Intelligence or Price IQ. It can be attained in near-real time, available on demand and should be scalable to the point where you could attain pricing information on an unlimited amount of products and competitors……
the Gazaro PriceIQ platform crawls, extracts, analyzes and stores pricing on millions of products and competitors in near real time and is infinitly scalable. The PriceIQ platform currently contains over 500 million price points and increase at over 7 million daily, which means in the time it took me to go over the last two slides, the database increased by over a 1000 price points. 1 month = 2, 629, 743.89 Data points = + 7,000, 0000
PriceIQ Competitive Price Intelligence helps retailers and manufacturers answer many critical questions, among them:
Gazaro PriceIQ provides retailers and manufacturers feature rich solutions and data-on-demand feeds along:Dimension – pricing by product, competitor, category, and/or brandLevel of abstraction – store-level, departmental (i.e. Merchandising, Purchasing), and/or executive level dashboardsFrequency – from monthly reporting to real time queriesType – Excel, CSV, Online and API reportingLet’s review some of Gazaro PriceIQ’s reporting capabilities…..
Let’s review a few sample reports:Here is an example of real excel-based product level intelligence report illustrating pricing variations on a Sony digital photo frame over the course of a given week in December and across 9 competitors. You can see the stark difference in pricing strategies. The delta or difference between the lowest price competitors versus all others is as much as $40 dollars or 40% on a 100 dollar product.
In addition to product here is a sample online brand-level report….
And a excel-based Company level report using over 136,000 pricing comparisons……
In conclusion Gazaro CPI solutions provide…..
Thank you for attending this webinar. You can learn more about Gazaro PriceIQ on our website, or drop us a line on twitter, facebook or by email at email@example.com
Shopping (1930 – 2000)<br />Consumers blind to price..<br />Shopping based on location, convenience, brand loyalty..<br />Deals through flyers and word-of-mouth..<br />Power on the side of retailers and manufacturers.<br />
And this happened…<br />Competitor Group F<br />Competitor Group E<br />Competitor Group G<br />Competitor Group D<br />Competitor Group H<br />Competitor Group C<br />Competitor Group B<br />Competitor Group A<br />
What is CPI?<br />The action of defining, gathering, analyzing, and distributing by ethical means, competitor, channel and market pricing information for the purposes of gaining pricing transparency within an organization’s external operating environment. <br />
Results in days with no IT involvement;</li></li></ul><li>Thank you!<br />Gazaro PriceIQ: http://priceiq.gazaro.com<br />Twitter: www.twitter.com/priceIQ<br />Facebook: www.facebook.com/gazaro<br />Drop us a line: firstname.lastname@example.org<br />