For pricing professionals, competitors’ price lists are something of a holy grail. Knowing what other companies are charging seems like it would bestow a massive competitive advantage.
But even if you could get them, those price lists might not be as helpful as you think. Yes, they would show you what your competitors are charging, but they wouldn’t show you why they have chosen to charge that. It wouldn’t tell you what customers are actually willing to pay. And it wouldn’t tell you how the competition will change their prices as the market shifts.
And what would you do with those pricing lists? Sure, you could charge slightly less than your competitors, but you don’t want to compete on price alone. The last thing you want is to start a pricing war.
A far better treasure is to be able to figure out your competitors’ pricing strategies. You want to understand why they price their products they way they do and anticipate their reactions to changing conditions. Armed with that information, you want to create a sound battle plan that allows you to win without creating a race to the bottom.
Seems impossible, right?
Here at PricingBrew, we’ve actually created a robust process for doing just that. Instead of just revealing your competitors’ current prices, it decodes their strategies. It walks through
- How to identify and the competitors that pose the most significant threat to your business
- How to assess each of your top competitors to understand what they care about (and will ignore), their ability to act and respond, and their strengths and weaknesses
- How to gather intelligence on your competitors using readily available resources and information
- How to put it all together to glean useful insights along with actionable information and predictors
One of our most popular webinars, Anticipating Competitors’ Pricing Moves, details this process. It helps you figure out the right strategic questions to ask. Then it helps you incorporate the answers to those questions into your pricing strategy, while also keeping feedback from customers and salespeople in its proper context.
Along with that webinar, you might also be interested in the accompanying tutorial: Step-by-Step Competitive Analysis for Strategic Pricing. It breaks the process into seven steps, delving into each at length. It also links to several worksheets, scorecards, and other resources that can help you along the way.
One of the most useful of those resources is the Triangulated Competitive Audit Guide. It provides an expanded reference list of the various types of questions you’ll want to ask about your competitors and why. You can use this list to shape your thinking about specific competitors, or you can use it to conduct formal competitive assessments and develop strategic competitive profiles.
Like any grail quest, attempting to decode your competitors’ pricing strategies is not for the faint of heart. It takes a lot of time and hard work, and you’ll need some luck along the way. But in the end, the process will be well worth the effort you put into it.
Anticipating Competitors' Pricing Moves
Your competitors' pricing actions (and reactions) add even more complexity to pricing. So what can you do to anticipate competitive moves and prevent them from spoiling your pricing efforts?
Step-by-Step Competitive Analysis for Strategic Pricing
How to use competitive analysis to identify actionable opportunities to gain strategic advantage, expose competitive gaps, provide differentiation beyond price, and reduce the pressure to discount.
The Triangulated Competitive Audit Guide
The Triangulated Competitive Audit Guide provides you with a full reference list of the strategic questions you'll want to ask to gain a deeper understanding of your competitors and their motivations.
