Introduction
While there are several factors to consider when making a competitor price monitoring purchasing decision , the method of data collection is one of the most critical. Most competitor price monitors crawl websites to search for identical items based on the manufacturers’ SKU or model information. The alternative method is to map products based on attributes. This paper discusses the pros and cons of each method and helps retailers to identify the best solution for their purposes.
Definitions
Automated Crawling
Crawling is the most common approach and involves sending automated spiders to search predefined websites for identical products based on the item name and/or SKU or model number.
Mapping
Mapping matches products based on Ugam Interactive’s proprietary technology and equates products based on rules and attributes identified by the originating retailer.
Benefit Comparisons
The main benefit from automatic crawling is price. Crawling is a relatively inexpensive way to generate data. However, mapping provides several significant benefits including:
- Increased product coverage
- Data accuracy
- Comparing similar items
- Associating brand name and private label items
- Comparison of products packaged differently
Benefits Comparison Summary
Benefit 1: Coverage
The amount of data generated by a competitor price monitor is a reflection of the number of products the solution is able to match. For example, if a retail company has five products to match across 3 competitors, they would expect 15 results total, assuming all products could be matched across all competitors.
In the case of electronics, crawling tends to do a very good job of covering all products as model numbers are generally used across all competitors. However, for all other categories, crawling tends to falter as the model numbers are either not present or are not common (for example, retailers use their own model number system).
Instead of relying on product names or numbers, mapping relies on a detailed comparison of predefined attributes to match items. Because of this approach, mapping provides an almost perfect product match across all categories.
Benefit 2: Data Accuracy
The accuracy of competitive intelligence data originates from the quality of the data compared. Outside of electronics, automated crawling has low coverage and also experiences issues in accurately matching products. Because of these two issues, crawling provides approximately 40-60% data accuracy. This gives an overall view of the marketplace, but does not provide the reliable, in-depth data needed to make critical assortment, pricing, and promotion decisions to help gain market share while protecting margins.
Product attribute mapping provides guaranteed data accuracy, usually around 95-98%. Guaranteed accuracy means that all the products you want to monitor are being reliably monitored because they were correctly mapped at the start of the project.
Accurate mapping and product data provides you with reliable information that can be used strategically to:
- ensure better price position management based on the most recent data
- price to stay competitive while keeping margins where needed
- have the information available needed to react to competitors
- save merchandiser resources from manual product checks
- deliver informed tactical promotional decisions
- use current and historical data to review upcoming seasonal targets and make any necessary adjustments to adapt to current and anticipated competitive pressures
- anticipate competitors’ promotional and assortment strategies
- review how competitors’ frame their assortment architecture
- predict future pricing based on past pricing trends
- support assortment buying plans as well as pricing structures
- anticipate where you will realize the highest ROI before you make your seasonal purchasing decisions
- review lessons learned from competitors’ seasonal strategies
Benefit 3: Comparing Similar Items
Automatic product mapping relies on identical product attributes and cannot pick up similar products that compete with your products. However, mapping relies on proven technology using attributes to match items. Retailers can identify products that compete with theirs or identify attributes that are used to identify competing items. Mapping allows retailers and manufacturers to monitor and compare products that are similar to theirs.
For retailers that only sell their own brand, this ability provides a strong overall competitive picture down to the product level. While monitoring similar products is obviously important for businesses who only sell in-house brands it is important to every retailer who wants a complete picture of the competitive field. Similar monitoring provides a complete competitive pricing, promotion, and assortment overview for all retailers.
Benefit 4: Comparing Private Label Items
With consumers becoming more cost sensitive, more private labels are appearing. Crawling cannot compare private label items to other private label or name brand items because the SKU/model numbers different. However, a mapping technology system such as PriceTrac will match all products based on attributes and can accurately compare private label to brand name items.
Benefit 5: Comparing Products Packaged Differently
Mapping technologies, such as the one used by PriceTrac, allows retail businesses to compare products sold in different packaging. For example, Retailer A may bundle 5 items together to sell while Retailer B might bundle 8 items. Or Retailer A may bundle Product A with Product B to sell together, while Retailer B sells these two items separately. Only PriceTrac can accurately compare the prices on these items.
For more information, read these case studies:
• Competitor Price Monitoring Comparing Bundled and Bulk Products to Competitors’ Item Price
• Comparing Private Label to Competitor Brand Pricing
Summary
Accurate, flexible price monitoring provided by mapping technology delivers data that can be relied upon to support strategic decision making by companies. The revenue benefits from setting the best price points will pay off the investment quickly.
For those retailers who are only looking for high level data, a cheaper, automatic solution will suffice. It is important to understand that this type of monitoring will not provide guaranteed accurate product by product data, but more of a category level comparison.
Learn more about the benefits of the PriceTrac competitor price monitor by watching this two minute video.
Solution:Accurate Competitor Price Monitor
Why Choose PriceTrac?
Unique Mapping Capabilities The Ugam Interactive PriceTrac competitor price monitor uses a proprietary mapping methodology to ensure data accuracy, reliability, and flexibility.
Guaranteed Accuracy Only PriceTrac guarantees you accurate competitor price monitoring data for the competitors you specify, at a frequency that is completely defined by you. PriceTrac provides reliable competitor monitoring by using proprietary data collection technologies backed up by highly trained analysts.
Like to Similar Mapping Available The PriceTrac competitor price monitoring solution offers like and similar product (Private Label) mapping so that you can monitor items comparable to your products as well as those that are identical.
Fast Set Up and Turnaround You will start receiving data in weeks, not months. PriceTrac can also input hundreds or thousands of new products at once and have them mapped and ready for use within days.
Customizable We understand that every retailer has different needs, PriceTrac is built on a platform that allows us to configure the presentation, reporting, and business rule layers quickly and efficiently.
Complete Pricing Information PriceTrac provides total pricing data, including original price, MSRP, promotion price, and final price with or without shipping costs.
Integration PriceTrac can be fully integrated into enterprise BI or Price Optimization platforms, homegrown or off the shelf.
Large Volumes Available Monitor hundreds or thousands or millions of products from as many retailers as you want.
Increase Updates during Critical Selling Seasons Increase the frequency of your updates during critical selling periods. For example, you can change from weekly to daily updates during the holiday season.
Updates at the Touch of a Button You can choose important products to update pricing on demand. Simply identify which products to update pricing on, then press the update button.
Complete Reporting Complete product data and employee usage reports available and exportable
Intuitive PriceTrac’s easy-to-use interface is simple to learn.
