"Vodafone follows in the footsteps of Telefonica and Orange, and raises its rates", "Netflix could raise its rates in view of the movements of its competitors." News articles such as these, which we see daily in the media, highlight the importance for brands to monitor the prices of the competition and update their prices based on the movements observed, and to do so without making mistakes.
Brand positioning largely defines the price of products. And, as you know, price is the first factor of the buying decision for the majority of consumers. But is the price based only on brand positioning? To what extent are more objective aspects such as the quality of the products involved?
Many times the perception of the quality that is created around a brand, as with Apple, leads customers to consider all their products as the best on the market. But is the iPhone the fastest smartphone on the market? And one that offers the best image quality? Some of these points are debatable, but it does not prevent that the brand is considered one of the most valuable in the world, a value that is reflected in its pricing policy and ultimately determines the prices of other companies in the sector.
Question of perception and comparison
The brand perception that the owners and workers of a brand have is not the same as the perception that the consumers of that brand have. There is no point in considering yourself the ideal brand for urban youth looking for their first car, if reality shows that the young people who just took their driving license end up buying another vehicle. That is why it is fundamental to analyse how the brand is perceived: are there complaints in social networks? Are there negative comments on the web about the last campaign to promote a product? Or allusions to high prices in relation to perceived quality or comparative price competition? It's time to change.
Social networks have broken the barriers between brand and customer, and their interactions give a clear idea of what they think about the brand and its products. In addition, followers of a brand in social networks are influenced by the messages and preferences of their friends. That is why it is fundamental to respond to these criticisms and suggestions, and to do so fast. To be accessible and close to solve any possible doubts that the customer may have before, during and after the purchase process, will significantly improve the perception of the value of the brand. It is about making the brand justify the price, not the other way around.
Adopting a dynamic pricing strategy allows you to change the prices of the different products according to the changes in the market in real time, something very simple to carry out with a program to detect the prices of the competition. This makes it possible to ensure that the product that the customer is looking for is available at the right time and at the right price.
The automation of the comparison process enables prices to be continuously updated and to avoid losing sales when a competitor decides to offer their products at a much lower price.