When working with new customers, one of the questions that I often get is “How often should I be conducting searches, and what should I be searching for?”
With regard to how often you should be searching, my base guidance is to search no more often than your ability to both analyze the data and change prices. For companies using automated systems that are capable of analyzing and updating prices regularly, that may mean repeating searches multiple times each day. For companies that require an analyst to interpret the data before acting on it, that may mean that searches are repeated every few days to every few weeks. With regard to price updates, some companies are configured to update prices continuously, while others may only update prices once per day, once per week, or at another cadence. The bottom line is–customers should search no more frequently than their ability to analyze and change prices in the market.
When determining what to search for, QL2 has some customers that want to search their competitors for everything that the customer sells, be it retail products, hotel stays, airline tickets, or rental cars. They use this information to get a broad baseline of their competitive environment, including a better understanding of how their product assortment compares to the competition.
Over time, most customers want to add an element of focus to what they are searching for as they use competitive data to drive profitability. I have seen all the following search strategies employed.
- Focus on the highest revenue areas of your business. For many companies, the 80/20 rule is real (80% of your profits come from 20% of your products). Getting pricing right on that 20% will have the greatest impact on your business.
- Focus on underperforming areas of your business. When an area of your business is underperforming in comparison to expectation, competitive information can help you understand why and if you need to make corrections. It also can help you rule out being mid-priced as the issue.
- Focus on taking advantage of seasonality changes. Most companies see demand changes throughout the year. As an example, for a home improvement store, competitively pricing lawn mowers is not very important in November but is essential in April.
- Focus your searches to replicate where your customers are searching. If there is an e-commerce component to your business, searches by your customers each day can provide you with information as to what is significant to them. Replicate some of their searches on your competitor’s sites to determine how competitive you are.
- Research complaints from within your organization. When pricing is set at the Corporate level, it is inevitable that Corporate will get questions from the field related to pricing decisions. Strategic companies use competitive information to respond to those questions.
- Strategic planning for expanding your business. If there is a market that your company is considering competing in, before making the decision to invest millions of dollars in that market expansion, QL2 data can help you determine how best to compete.
QL2 can help you successfully implement any of these search strategies. Contact us to learn more, and view our case studies to see examples of our services. Book a demo today.
Written by: Ben Greenwald, Sales Executive