Brand building and pricing

05/10/2017

Angela de la Vieja

Although price is one of the four key variables for the definition of marketing, in reality, a marketing manager concentrates his activity around the issues of identity, values, positioning or value proposition of the brand.

Sometimes due to organization reasons and others because of the dynamics of the business sectors, the fact is that the focus of marketing areas is not usually in the treatment of price as a variable. And when this happens, although tactically the price treatment can be satisfactory, in the long run this can produce strategic and competitive weaknesses for the brand.

Perception of price in the digital age

Perhaps the exception in the incorporation of the price as a key marketing variable are luxury brands and low cost brands, which from the very moment of conception understand the strategic impact of price on all its value proposition.

The vast majority of brands, whom do not operate any of these extremes, should first reflect on how price in the digital age is perceived to make it a truly strategic variable.

Far beyond the price of a product, a category, or a particular business sector, the way the concept of pricing is viewed has varied substantially for users. And this manifests itself in three essential aspects: the variety, the sensibility and the perception of value.

· Variety. Until the arrival of the digital world, consumers understood the price within a range of reduced possibilities, such as the sale price or list, discounts, promotions or seasonal sales. With the arrival of the internet, the range of possible prices for products or services is much wider and includes previously unknown options such as free, freemium, pay as you go, membergetmember, paywith a tweet or bulkprice, among others.

· Sensitivity. Consumers are more informed than ever and the different ways to research and compare prices online is very simple and affordable. In addition, proliferation and competition among ecommerce encourages users to actively search and compare offers before deciding.

· Perception of value. The relationship between price and value proposition has always been complex. While brands such as Apple have dominated and associated these two concepts since the start, other brands have had to go a long way to build that association, as Samsung has done or as Huawei is beginning to do by warmly creating the Honour brand. But in addition to this complex relationship of building to create equivalence between high value and high price, now more than ever the perception of value is subject to external influences. Remember phenomena’s such as Black Friday or the impact of the fact that a celebrity uses a product, as it happened with the beginning of brands, such as Hawkers sunglasses.

The price to create a brand

The aspects mentioned above influence the way to create a strong brand from its origin. There is no single way to give the price that strategic role that it must have, there are different ways such as early incorporation or diversion of care or early incorporation of the price.

In innovation processes, from the prototyping phases of new products or services, the focus is on technical or functional viability, the price comes in a second phase of market testing. Companies like Google incorporate the treatment of the price from the conception phase and in this way they propose objectives that go from commercial viability of prices to the the new product capacity of adding or subtracting in the price perception of the brand at a global level or diversion of attention over price.

The price works very well when it is not the motive of the value proposition (except in the cases of the luxury or low-cost industry). If a brand puts the price at the centre of its strategy then it needs to shift the attention to other attributes. Cabify or Car2Go are interesting examples of this. They are the cheaper alternatives if you do an analysis of the competition with the traditional taxi with which they compete, but their focus is not on price. In the case of Cabify, there is a very consistent proposal of availability and quality of service, and, as well as being cheaper. In the case of Car2Go there is a proposal of flexibility and sustainability, and, in addition, the price is less than that of a taxi.

11/11/2022

Consumer behavior: How can behavior tracking be effective for setting the right pricing strategies?

Behavior tracking is becoming massively popular today. As a result, pricing strategies born from studying consumer behavior are a merchant's dream come true. If done right, it can conquer every market for the business quickly. With abundant data available, the strategic makeover of the pricing models is becoming easy for companies.

What is behavioral tracking, and how is the data beneficial in pricing?

For a quick understanding, behavioral tracking refers to gaining in-depth knowledge and insights into consumers through their web data. Their browsing habits, spontaneous decisions, shopping interests, and preferences come under behavioral tracking.

How can enterprises use customer behavior data?

Companies can use customer behavior data as a tool to strengthen their hold on the market. A customer’s preferences, values, and tendencies allow businesses to work in sync with them through the collected data. Apart from this, customer behavior can also aid in:

Tailoring customer needs for customer retention

Personalization is becoming the heart of a company’s growth. No matter in which area an enterprise is functioning, tailoring the services, products, and solutions is becoming increasingly crucial. Uniqueness and personalization attract the crowd like no other.

Increasing the overall value

One of the best ways customer behavior data affects a business is by upgrading the value of customers for the business. The customer’s characteristics allow the company to target the people that match the business prospects well.

Optimizing every type of content

Everything that is up for digital display requires content. You must have seen companies unveiling their products or services through advertisements and making the initial public appearance. Two essential sales strategies – upselling and cross-selling comes through content optimization.

Pricing Strategy

Last but certainly not least is the influence of customer behavior data on the pricing strategy. The pricing strategy essentially constitutes content derived from data analysis. Companies need to have a dynamic approach to the pricing system to attract the right customers.

17/02/2015

Saint Valentine’s Day, always a good opportunity

V-Day is looming, a long-awaited date for all and also a good occasion for the eCommerce. According the study conducted by Prosper Insights and Analytics, it is forecasted the average consumer expense that day will be the highest in last years. Furthermore, 25% of them will buy online, which means an increase of 4% regarding 2014 (The US department of Commerce). This is, therefore, a key date where market competitiveness increase and which could be assumed as a big opportunity for our business or, a big fail if we do not adopt the correct strategies.

How to turn this event into an opportunity? To achieve this goal, we need to adapt our prices to this hostile environment, i.e. we need to develop an appropriate Dynamic Pricing strategy that allows us to adapt our prices to the variations produced in supply and demand and to position us ahead of our competitors. In V-Day, the frequency in changes will be higher, carrying it out each hour or even each minute. It is estimated that 65% of leader retailers have the ability to respond quickly at these variations, such Amazon. For this reason, it acquires great importance the correct use of a software specialised in price motorisation of competitors. Do not miss the time and adapt your business to new adversities.

28/12/2022

Which are the best footwear marketplaces to sell on?

Footwear marketplaces are booming. The last decade has seen the launch of new specialized marketplaces with millions of different users. Among them are Spartoo, Sarenza and Farfetch, portals with international reach. Their main value is that they unite hundreds of footwear brands, as well as offering clothes and accessories. Although each has its own characteristics, they are all vertical marketplaces, i.e., they focus on a specific area, and their sales categories are interrelated. For sellers, these portals provide an opportunity to expand sales channels and drive the globalization of their e-commerce business. We explain how to sell on these footwear marketplaces so that you can assess whether they align with your plans for the future and then start defining a possible pricing strategy.