Data Blog by Lizeo
Using Data to Improve Market Understanding
The digital transformation of a company can be tackled in many different ways: customer relationships, optimization of internal processes, identification of new business models, among others. But inevitably, it is built around data which constitutes the focal point of any digital transformation. This data can also provide a better understanding of your market, and help you improve marketing strategy, business practices, pricing processes, etc. How does this work? Through an in-depth analysis of your positioning and the impacts of your operational and strategic actions. Find out here, through real, concrete examples, what data can provide to your business teams to help further develop your business.
How can your pricing teams use market data?
In mature and highly competitive markets, a good pricing strategy is essential to increase sales volume and ensure sustainable growth. In this context, dynamic pricing represents an effective solution, allowing you to stand out. Its purpose? Make your pricing stategy a competitive advantage.
Managing your market price data means:
- increased visibility of competitive price dynamics
- the ability to continually refine your price positioning
- monitoring price trends in your market, etc.
Competitive pricing: dynamically adapt prices in relation to the competition
One of the four main strategies to setting prices consists of dynamically determining the price of your products based on those of your competitors. The in-depth knowledge of your market prices is the inevitable basis for any pricing strategy.
Once the benchmark is established, the most suitable price for your sales objectives can be established. However, note that for prices to be relevant, they must also take other criteria into account such as the customer perception or the profitability of your company. This in-depth knowledge of market prices is an essential basis for any pricing strategy.
Alerting: keep track of your pricing policy
As with all data processing, automation offers an undeniable gain in productivity and reactivity which can be useful in terms of pricing. By using an alerting solution, you can be automatically notified as soon as a price no longer meets the criteria defined within your pricing teams.
Over and above the competitiveness of your prices, through alerting you can ensure the correct application of your pricing policy. Your teams can continually check that the baseline prices, defined with your distributors as part of your sales agreements, are respected.
For the tire manufacturer, alerting will provide a clear view of its distributor’s sell-out market to:
- Establish a baseline price in line with the market pricing policy
- Have a clear vision of practices, and be informed of any breach to sales agreements by monitoring a large number of online distributors websites.
Market data at the service of marketing teams
Today, data is crucial to understanding the sell-out market. In this field, the distributor panel (whether private or independent) has become a key element for tire manufacturers and distributors that are trying to understand their market.
Based on sales made by a sample of the market’s representative players (online and offline), the panel produces an overall and relatively precise view of the sell-out market, while identifying emerging trends. A tool to measure performance that has become essential, the distributor panel provides a solid work base, as well as decision making support for marketing teams.
Benefits of the distributor panel
The panel is a tremendous asset to:
- following market trends
- monitoring and managing performance
- assessing the coverage of a customer’s portfolio
- Identifying development paths in the market
- optimizing inventory management, etc.
Product comparability: a cross-cutting requirement
A real business problem at the core of any analysis is product comparability, which is interesting for marketing, pricing, and sales teams. It focuses on defining and formalizing the references with which your product is compared to competitors. The idea is then to detect equivalent products based on the different technical and/or market characteristics, prioritized depending on their relevance.
Often done manually, this task can result in:
- errors related to marketing biases or a false perception of products and competitors which can lead to the comparison of two non-equivalent products;
- a difficult, or even impossible scaling (increasing number of products, etc.).
Faced with the increasing volume of data, automation has now become inevitable for product comparison. It helps standardize the product comparison methodology, and saves time in data mining, to produce a factual and truly objective analysis.
The advantages of a good product comparison
Correctly comparing your products will allow you to:
- Identify specific characteristics of your products to highlight them and make them a competitive advantage
- Optimize their price positioning with respect to your competitors
- Detect market opportunities such as the development of a new range or change the positioning of an existing product.
For a better understanding of your market, data has become essential, for pricing teams as well as marketing or sales teams.. These few examples (not complete) show that data must now be placed at the heart of your organization. To improve your processes and your value proposition, you must ensure that data can be accessed at all times and that it can be used by all your services. It is one of the main issues facing the digital transformation of companies. Would you like to find out how market data can boost your activity?
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