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Should your retail pricing strategy differ cross-channel?

Should your retail pricing strategy differ cross-channel?

When you’re building your brand’s omni-channel strategy, should you have a separate pricing strategy across your different channels? This is a question raised frequently in the discussions around omni-channel retailing. With customers mixing their in-store experience with the mobile channel, they’re becoming increasingly savvy to cross-checking prices and comparing your products with those of your competitor’s, so should you not make it easier for yourself and make the pricing strategy identical across channels?

 

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For fashion retailers, it’s a competitive existence. And with footfall continuing to dwindle, many retailers have taken to promoting their products in the digital space. With mobile now accounting for over half of all e-commerce traffic, it’s not just about just having an e-commerce store anymore. As most retailers are aware, Google’s mobile-friendly algorithm updates over the last few years have had a massive impact on how retailers and other online businesses look at the user journey. So, aside from the fact that users are now expecting a seamless experience across device and channel, how should you be pricing your products to appeal to your target audiences?

With a single pricing strategy, it’s perhaps more straightforward for your fashion brand to keep tabs on how each channel is performing, giving you the ability to simply compare conversion rates on each product. When setting your omni-channel pricing strategy, are you aware of two completely different audiences visiting your brand in-store compared to those visiting you online? If your brand has two completely abstract audiences, with different purchasing habits and there’s not much overlap between your online and in-store customers, then perhaps two separately pricing strategies makes sense for your business. If you know, for example, that your online customers are competitively comparing shops for the best deals, then why shouldn’t you compete with the other retailers for their business? As highlighted in an article by pricing strategy consultant Rafi Mohammed, “it is inevitable that some consumers will show up at stores and request the web price”, but don’t let that put you off your separate pricing strategy!

Mohammed continues:

“Smartphones make it easy for customers to find lower online prices while they are in a physical store; this reality may make retail executives hesitant to set different online and in-store prices. The worry is that consumers will be put off by knowing that prices differ based on channel or experience. But this hasn’t been the case with airlines...”

Trialling and tweaking your omni-channel strategy once it has been implemented should form the foundations of an ongoing iterative process to your user journey. Consumer behaviour changes constantly, and adopting a reactive and proactive approach to these strategies is how you’ll grow and develop as a brand. You can only adopt the proactive approach if you’re willing to put in the analysis required to truly understand your audience and the reasons behind their behaviour, both on-site and in-store.

To learn more about how you can ensure your brand is ready for its transition into an omni-channel strategy, download our guide specifically aimed at fashion retailers – access the guide now!

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