Pricing Intelligence finds significant online price disparities, requires careful shopping comparisons

Pricing Intelligence finds significant online price disparities, requires careful shopping comparisons

Christmas rapidly approaches and the shopping season gets into high gear, Lixto Software is urging online retailers and consumers alike to consider intelligent pricing approaches.

“In the online shopping world, the old adage of ‘making your list and checking it twice’ has never been more important when it comes to comparison shopping,” said Christian Koestler, managing director of Lixto Software retail and consumer products ‘price intelligence’ vendor. ‘Price intelligence’ refers to computer-based systems that identify, compare and analyse pricing and other revenue-related data for a business’s own operations as well as its competitors to make informed pricing decisions.

Optimising price compeitiveness

The trick for both the consumer and online retailer, according to Lixto, is to find the best deal. The software comapny used its Price Intelligence Suite recently to track the prices of the “Terrific Twenty” toys on the 2011 Christmas Toys List from ToysRUs. Looking at prices across the UK’s top online retailers, Lixto found tremendous disparity in pricing.

On any given day over the past week alone, the prices of the “Terrific Twenty” toys have changed – sometimes multiple times – at each retailer. The price difference for individual toys on the list at even the same retailer has ranged from 1 to 29 per cent over the week, with movement both up and down. Between retailers, price differentials run up to 30 percent on singular items. Disparity becomes even greater looking at prices with and without shipping costs.

Messages for savvy consumers, e-retailers

The message to the savvy online consumer is to take the time to comparison shop, to look at prices with and without shipping costs, and to evaluate online ratings for items they are considering. “The internet can be a great tool, but only when the consumer makes the effort to shop conscientiously,” said Koestler.

The message to the internet retailer may be even clearer, Koestler added. In the current economic market, he said, online retailers cannot afford to complain about online abandonment – the practice of a consumer logging on to a retail site, adding items to his/her online shopping cart and then exiting before making a purchase – if they are not offering consumers the greatest overall value.

With pricing and other purchase-influencing factors changing up to several times each day, Koestler pointed out, retailers are finding that advanced technology systems are the only way to remain competitive. "It’s time for online retailers to understand, at a deep level, where they stack up in an increasingly competitive – and vast – online marketplace.”