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Label: pricing strategy

Thursday 06th June 2013 The Importance of Maintaining a Competitive Intelligence Solution

Competitive intelligence is one of the most useful tools that a business can employ, giving them an unprecedented level of insight into current sector trends as well as specific intelligence on the actions of the competition. The nature of this intelligence can vary widely depending on how much research is conducted, from tracking the filing of intellectual property documents to price monitoring of entire product portfolios. Regardless of what aspects your company chooses to investigate, the results are always worthwhile.
The main aim of a competitive intelligence solution is to ensure that your company keeping a close eye on the innovative in-sector strategies and general fiscal plans of the competition. An accurate monitoring solution can be a huge competitive advantage, in an era when businesses succeed and fail by the smallest of margins. Thanks to the digital world and the internet, competitive intelligence solutions can be implemented for a relatively small expense, at least when compared to the cost of implementing such a plan in pre-digital times.
One of the less-common strategies for competitive intelligence gathering centres on the filings made by competitors with the local patent office. A careful monitoring of these filings can reveal vital clues about the direction of new product research and development, giving your company a chance to develop a competing product without having to wait to hear about it on the news first. They can also give insight into the chosen markets the competition will be targeting with their new product developments, potentially opening up other markets for you to go after.
There are a number of other information vectors available to the diligent competition monitor, including the tracking of any sort of promotions or special offers, filings with regulatory agencies and even the registration of new domain names. Trademark application filings are also an excellent way to examine upcoming branding efforts, offering critical intelligence on market positioning and upcoming product launches. They carry the added benefit of being made available much sooner than most patent filings, giving you the best possible lead times to prepare a response.
When combined together, these varied strategies can help businesses make decisions based on clear, actionable intelligence as opposed to simple guesswork. While they’re no replacement for the innovation that comes with outperforming the competition, they still provide much-needed insight into their business practices and intentions. If your company hasn’t yet implemented a competitive intelligence solution, you’re leaving money on the table that could be sitting on your bottom line instead.

Posted on June 06th 2013 at 06:19am by Ade

Friday 08th June 2012 The 5 Key Capabilities You Should Have To Maximise Your Profit

 There are five essential capabilities your business must have in order to get your pricing right, and therefore maximise on profit. 
1 Pricing Strategy
Whether you are a sole-trader or a global brand, a pricing strategy is at the core of all activities relating to the prices of a company’s products. It lays out the foundations of how you price your goods, therefore providing a framework of control.  It also helps you to remain focused when deciding what activities to carry out to gain pricing intelligence.  An example of a statement that you may add to your pricing strategy would be: “Our electronic products will 
always be the cheapest amongst our four main competitors.”
Before determining your strategy you should ask yourself lots of questions.  For example: What type of company are we?; Who are our customers?; Where do our products rank in terms of quality?
2. Organisational Management
This competency involves everything that influences pricing.  It is how a company arranges its people, structure, and culture.  Included in organisational management would be sales policies and staff training.  An example of this would be training all sales employees on the organisation’s sales policies, such as a policy that dictates the maximum discount an employee can give a customer. This training helps to ensure that with each individual transaction, the product is priced in an acceptable range.
3. Pricing Execution
This involves all activities that lead to a product price.  If organisational management is the training of the sales employees on the sales policies, the execution is the actual creation of these policies. Using the same example as above, this could be the decision to provide sales employees with the ability to discount a customer up to 10% before they have to seek approval from a manager.
Without the creation of a sales policy there is no guidance on what the price of the product can be to allow the organisation to still make a profit; and without the training there is no way of making sure your product is always correctly priced.  If neither were enforced, there could be the potential for the sales employees to be offering customers with a 70% discount, which could leave the organisation making a loss.  Obviously this is a situation every company wants to avoid!
4. Pricing Analytics
Analysing data is incredibly important in order to understand your profitability.  Past data should be scrutinised over to identify trends as well as any issues, such as unprofitable products.  Information gathered from data analysis can then be fed back into the other capabilities already discussed.  Analysis will also help to identify price optimisation, which i
s the price for a particular product that gives you the most profit.
5. Technology
Obviously the amount of technology you want to use is dependent on how big a business you are and how much you can afford.  But basic technology that enables all pricing information to be in one place can be affordable and it helps a lot with the pricing analytics.
Technology can also go beyond a database where you can create graphs and statistics on your pricing details.  You can also use technology to gain vital pricing intelligence from your competitors. For example, the product Competitor Monitor provides alerts to our customers as and when their competitors’ prices change. So if their pricing strategy involves being the cheapest retailer of a particular range of products, this alert then gives them the opportunity to change their prices accordingly in a matter of seconds. By outsourcing this sort of work, organisations are able to save money, which has a direct influence on the prices they are able to charge for their products, as well as positively influencing profit.
It is no secret that pricing is a crucial aspect in business and it must be considered in depth. This list is not in any sort of order, as each competency is equally important.  In fact, they all interlink and work with each other to help a company make the best pricing decisions possible. It should convey that pricing decisions are not a one-off, behind the scenes decision. Pricing decisions must use all relevant information gathered on a daily basis in order to maximise an organisation’s profit.

Posted on June 08th 2012 at 04:29pm by Stephanie Clish
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