A recent Gallup poll shows that rising prices is the number one economic concern for Americans, with 17 percent of respondents calling inflation the "nation's most important problem." And these increases aren't expected to change any time soon, as supply chain issues and other economic factors keep driving costs higher.
With inflation on everyone's minds, consumers will become more price sensitive when shopping. According to RSR, the highest ranked business challenge for retailers is that "our customers have been more price sensitive than ever."
However, changing thousands of prices in a timely manner is a daunting task, especially when retailers need to adjust to shifting market conditions day by day. To confidently manage pricing, retailers can turn to an AI-driven, dynamic pricing solution in these inflationary times.
Respond Quickly to Market Changes
Before inflation rates rose, retailers already had to account for several factors when determining their pricing strategy, including competition, costs, SKU relationships, price zone relationships and more. Now, market changes are quickly shifting, resulting in high costs being passed down to the consumer.
Because of shopper price sensitivity, retailers must effectively manage cost increases and make strategic pricing decisions quickly. They also need to account for consumer behavior changes and make the right adjustments. Dynamic pricing enables retailers to deliver faster, more accurate pricing optimization based on available customer and market data.
Automate Price Management for Every Channel
Manually changing prices to meet market demands is costly and difficult to manage. This is especially true when dealing with pricing across channels and locations — there must be a cohesive omnichannel strategy.
According to RSR, 40% of leading retailers ("Winners") expressed a need for more automated price management, implying a desire for more speed, efficiency and data-driven business processes.
With AI-enabled dynamic pricing, retailers can optimize thousands of prices instantly and consistently, adjusting to inflation and other pricing factors. It also gives retailers the ability to provide relevant, demand-based prices daily whether online or in-store. From promotions to new product launches, retailers are equipped with the data to make the most optimal decision across all channels.
Recognize and Correct Pricing Inefficiencies
A pricing strategy that worked last year may not work in today's market. This means that retailers must monitor and become aware of any inefficiencies that can occur. They also may need to adjust and set optimal prices from anywhere at any time.
With dynamic pricing, retailers can boost revenue and margins by reducing markdowns, loss and overstock. At the same time, they can build a positive price image and improve loyalty with competitive, fair prices — even in the midst of market challenges.
Respond to Inflation With GK Dynamic Pricing
Responding to inflation rates while keeping price-sensitive consumers in mind can be challenging. Even when rates go down, other market conditions will likely play a role in how retailers manage both their margins and price perceptions.
Retailers can prepare their pricing strategy for now and the future using dynamic pricing. Dynamic Pricing by GK provides faster, more accurate pricing optimization by using AI. With our solution, you can reduce the pricing workload, limit inconsistencies and decrease time wasted on manual tasks.
Our powerful machine learning algorithms instantly calculate optimal prices regardless of SKU count by comparing numerous evolving factors in volatile markets against various pricing strategies. With GK, you can always find the best price to achieve your goals.
Looking to optimize your prices in an inflationary market? Contact us today for a demo of our solution.
