Competitive Pricing Tips
With huge online retailers like Amazon, smaller e-commerce companies can struggle when competing on price, and often find themselves engaged in an unsustainable price war. ThinkGeek is an online retailer catering to computer enthusiasts and other “geeks.” It sells a wide variety of products, but to a very specific audience. These products are unique and highly curated, allowing ThinkGeek to compete with the broader online retailers.
E-commerce merchants can learn from ThinkGeek. Retailers need to know their margins and avoid selling at a loss. Pricing battles can be unsustainable in the long term and can damage customer relationships when they always expect low prices. Instead, online retailers need to know their Unique Selling Proposition (USP), and craft their pricing strategy around what makes the business unique.