Why Price Automation should be your new year's resolution | eCommerce Matters Ep. 026
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In this week’s episode, Philip and Rob discuss what Price Automation actually is, and why it should be a focus area for online retailers in 2021. The pros and cons are all covered.
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Full Podcast
Highlight: What is Price Automation?
Podcast Summary
Introduction
In this podcast episode, the hosts delve into the topic of price automation and delve into its benefits and implementation strategies. They share personal anecdotes and experiences that led them to become involved in the pricing space. The hosts emphasize the power of price automation in terms of time savings, optimisation capabilities, and the potential for business growth.
The Growth Potential of Price Automation
The hosts highlight a specific example of a company that implemented price automation and witnessed remarkable growth in its pricing team. Initially starting with just two members, the team expanded to 16 individuals due to the positive impact of automation. The hosts explain that by investing in automation and witnessing the benefits it brings, businesses become more inclined to allocate additional resources to their pricing operations.
Cultural Fit for Price Automation
The hosts emphasise the importance of cultural fit when considering price automation. They provide an example of a retailer that thrives on data, enjoys price testing, tweaking, and being in control of their pricing operations. They explain that businesses that enjoy the process of making mistakes and learning from them are better suited for price automation. Conversely, they caution that businesses lacking this cultural fit may not fully embrace the automation process and may face challenges in its implementation.
Challenges and Considerations
The hosts discuss several challenges and considerations that businesses should be aware of when implementing price automation. They provide examples such as encountering flawed or inaccurate data, selling products below desired profit margins, and making pricing decisions based on inaccurate competitor data. They stress the importance of recognising these challenges and investing time and effort into data quality and validation processes.
Understanding BlackCurve's Price Automation Solution
The hosts dive into the specifics of BlackCurve, their price automation tool, and how it simplifies the automation process. They explain the data ingestion process, providing examples of how the tool seamlessly connects with various platforms like BigCommerce and Shopify. They highlight the convenience of automatically transferring product data, competitor data, and other relevant information, reducing the need for manual intervention and streamlining the overall process.
Customising Pricing Rules with BlackCurve
The hosts use examples to illustrate how businesses can customise pricing rules using BlackCurve's workflow tool. They mention that businesses can start with out-of-the-box rules that have proven effective in certain sectors. However, they emphasize the flexibility to create tailored rules based on specific business requirements. Examples include rules that ensure price competitiveness, implement profit margin constraints, or adjust prices based on sales performance. The hosts stress the importance of setting constraints and safeguards to prevent unintended consequences and maintain pricing accuracy.
Drawbacks and Mitigating Risks
The hosts address potential drawbacks of price automation, using examples to illustrate their points. They discuss the risks of relying on inaccurate competitor data, the challenges of dealing with imperfect data, and the potential for selling products below minimum profit margins. They emphasise the need for businesses to invest in data quality, implement validation steps, and develop a data-driven culture to mitigate these risks effectively. They also highlight the importance of iterative testing and making incremental changes to pricing strategies to minimise potential negative outcomes.
Advantages and Outcomes of Price Automation
The hosts outline the advantages of price automation, providing concrete examples to support their claims. They discuss how automation leads to increased market efficiency and improved conversion rates by ensuring competitive pricing. They emphasize the ability to identify optimal pricing strategies through testing and incremental changes, providing examples of how businesses can adjust prices based on sales performance and market trends. They mention that maintaining price stability is crucial, as excessive price fluctuations can impact buyer perception and search engine ranking negatively.
Conclusion
In conclusion, the hosts reiterate the importance of considering price automation as a New Year's resolution for businesses. They emphasize the potential for time savings, improved pricing strategies, and overall business growth. They encourage businesses to evaluate their cultural fit, invest in data quality, and implement safeguards to ensure successful implementation of price automation. By embracing automation and leveraging its benefits, businesses can optimise their pricing operations and gain a competitive edge in the market.
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