In today’s world, a number of retailers are caught between some sort of a rock and tough place. A variety of retailers have an idea that in today’s market competition between different firms is at its peak. In order to gain a large number of customers what these retailers have to do is to lower their product prices. Like this old customers will not leave and a number of new individuals will prefer buying their products.
On the other hand, the pressure which is faced by these retailers is from the shareholders who argue that they have to raise the prices of their products in order to deliver those margins which are strong. History tells that those retailers who are indiscriminately raising the prices of their products or are lowering them are facing the risk of bankruptcy.
Only those retailers are successful who are being more surgical with the movement of prices and they are ready to invest in those prices which are lower. As a result, a number of these investments are providing a different best return on a variety of price images.
Price image is a measurement of the total perception that different shoppers have of the retailer’s pricing. The price perception of a shopper is not formed by price alone. They are many other factors which influence the price perception of a shopper.
Things impacting price image
Those unit movers which are higher have a greater effect on price image as compared to those unit movers which are lower. In the same way, that purchase frequency which is higher may impact greatly as compared to that purchase frequency which is lower. In the same way penetration of that basket which is larger have a greater impact on price image. Those items which are drivers of price image leave a greater impact as compared to those items which are dragged.
In the same way, items which are being displayed on signs and a number of displays might have a greater impact on price image. This may also include search activities which are higher online. Another factor that may affect the price image may include pressure which is more competitive or that pressure which may be a substitute and it may be created by one’s own assortment. The format of the retail and the category strategy may also affect the price image.
Improving price image
Retail science is capable of identifying that which sorts of items have the most influence on the price image. This can be done by analyzing those sales which are historical, availability of that data which is online and the attributes of the products in order to identify different products where a variety of shoppers are seen to be sensitive to a certain price. Then the technique of price testing has to be applied in order to verify different results where sometimes confidence seems to be low.
Maximizing the investment in the price image by retailers
This thing can be done by identifying those items which are sensitive to price. One can utilize the science of demand in order to identify the sensitivity of price for every product including store and segment of customer. Those items should be identified which have some sort of key value. These may include those items which are very sensitive to price and are those which are moving highest in one’s assortment. In this regard, one should be utilizing the learning machine.
Usage of price optimization
One should establish the strategy of items which are of key value. In this regard for one to achieve their strategy, the method of price optimization should be used. This should be done for every item of key value and for every segment of a customer. One should be able to introduce those products which are able to provide a higher quality of margin even at lower prices.
One of the most important challenges that are being asked to address by a variety of customers is the challenge of price image. In this regard, one should be using different promotions including end caps in order to draw attention to a number of those prices which may be leading the market.
Developing a strategy to alleviate risk
If one is asked that what is that one factor which is a hurdle for an investor when he is trying to increase his wealth? One’s answer to this question might change over time. It all depends upon the environment of financial marketing in which an investor might have been raised or he might have been paying some attention to different capital markets.
In this case, one should develop such a plan which is very well constructed which should be based on the principles of management. But one should stick to these principles in good and bad times both.
When one is acquiring any sort of an asset then he should be doing this at a certain price. This should not be done in any sort of terms because if something bad happens when a certain person does not has to certain his entire career again. For a number of investors, the thing that matters a lot is wealth. Once they are wealthy their main emphasis is how to protect the wealth which they have got. They might be securing this particular wealth for a very long period of time. They must not go behind that return which is theoretical if the latter is introducing that risk which is a complete wipeout. The performance of the past is not indicative of any sort of future results. Investing may involve a number of risks which may include the possibility of the loss of certain principles.
One should not forget that if in today’s business he is rich then a time may come when he may even face some sort of downfall too. One should also pay a very careful attention to the structure of one’s liabilities. This can mean a difference between the independence which is financial and the total ruin.