Retailers are responding to increased competition across channels with aggressive and continuous price changes. Business challenges from competitors as well as customers and shareholders drive these ongoing price promotions and adjustments. Yet as retailers plan and execute their pricing cycles, most cannot predict the impact of price changes, nor truly analyze the effectiveness of those changes.
These are among the findings revealed in a Retail Systems Research (RSR) Benchmark 2013 report, titled: Tough Love: An In Depth Look at Retail Pricing Practices. The study is based on a survey of 134 retailers, gauging their pricing challenges, opportunities and technology adoption plans.
Survey data indicated that “while some retailers have succeeded at high stakes promotion wars driven by the self-fulfilling prophecy of consumer price sensitivity, others are failing ― sometimes spectacularly ― even as the shopper becomes more and more accustomed to ever more dramatic and frequent promotions,” according to the report. In fact, “those [retailers] who over-perform on year-over-year comparable sales are far more likely to stay the course in their pricing strategy than their competitors.”