Competitive Pricing Strategy for a Fashion Retailer
With the ever-growing popularity of online shopping, the competition in the fashion retail market is on a constant rise. This demands fashion retailers to keep a watch on their competitors’ pricing strategies while setting prices for their products. By leveraging a competitive pricing strategy, businesses can compare and analyze the final prices of their products against the prices of their competitors.
The client is a fashion retailer based out of Germany.
Our client, a fashion retail firm, encountered a steady decline in their sales rate for two consecutive years as they focused on cutting costs instead of investing into acquiring new customers and increasing revenue. In an attempt to retain their valuable customers, they provided huge discounts and offers to them. However, this resulted in price wars with their competitors and had a negative impact on the company’s profit margins. Therefore, before setting prices for their new products, they wanted to carry out a thorough analysis of their competitors’ pricing models.
Also, by leveraging Infiniti’s competitive pricing strategy, the client wanted to meet their business objectives such as:
Higher rate of success – By leveraging Infiniti’s competitive pricing strategy, the client wanted to track their competitors’ products and prices over time. By doing so, they wanted to make changes to their product prices accordingly.
Prevent the loss of market share – By leveraging Infiniti’s competitive pricing strategy, the client wanted to set the product prices the same as their competitors or even cheaper. By doing so, they wanted to regulate the competition by preventing the loss of customers and market share to their competitors.
Adopt dynamic pricing – With Infiniti’s competitive pricing strategy, the client wanted to stay abreast of price changes in the market. Also, they wanted to adopt a dynamic pricing model to make random changes to their prices to compete in the market and maximize profits.
Our competitive pricing strategy followed a four-phased approach that included:
- A market scanning and monitoring analysis to analyze the factors impacting the product demand in the German fashion retail market. Also, the experts analyzed the different pricing strategies gaining popularity in the German fashion retail market.
- A competitive intelligence study to analyze the top companies in the German fashion retail industry. Also, the experts analyzed the pricing strategies, business models, and market position of the top fashion retail brands in Germany.
- A competitive pricing strategy engagement to evaluate the price gaps between the client and their competitors.
- A market segmentation study to categorize target customers into various categories based on their buying behaviour, spending patterns, and value for the brand.
Infiniti’s competitive pricing strategy engagement helped the client to competitively set prices for their products. Also, by continuously tracking their competitors’ products and prices over time, they were able to adjust their prices accordingly to achieve a higher rate of success. In addition, by implementing a dynamic pricing model, they were able to make rapid changes to their prices to compete in the market and maximize profits. This helped the client to regulate the competition by preventing the loss of customers and market share to their competitors.
Also, with Infiniti’s competitive pricing strategy, the client was able to curtail losses in market share and adopt cost-effective marketing and discounting strategies based on the market competition. This helped them to retain their valuable customers and enhance sales by 21%.