What is automatic price calculation, and why is it a good idea?
The Internet is full of different sales points and price comparison tools, putting the power in the consumer’s hands to find the very best deals for their online purchases.
In the extremely competitive environment that is e-commerce, it is increasingly difficult for the merchant to adjust prices manually by carrying out their own price comparison searches.
Automatic price calculation meets the following merchant needs:
– Ensures profit margin
– Optimizes Price vs. Profit
– Increases revenue
– Saves time
How does the best offer (BuyBox Winner) work on Cdiscount and how can I get it?
« Cdiscount C le marché » that allows third-party vendors to sell their product catalog on the site.
This means that several offers exist for the same product, however the best deal is placed on top of the list.
The top offer is becomes the Buy Box Winner (BBW), which guarantees the chosen vendor the next sale.
When a customer adds a product to their shopping cart, the Buy Box Winner for that product is selected automatically.
Cdiscount has an internal algorithm that automatically assigns the Buy Box Winner among all eligible offers for a given product.
Unlike other marketplaces, Cdiscount does not include vendor evaluation criteria in its algorithm for the Buy Box Winner selection.
The rule is very simple: The cheapest offer gets the Buy Box, even if the difference is only a penny!
Watch out for in-store collection!
It is possible for a vendor to propose different shipping prices, as you can see in the image below:
The first price listed at 0€ is only for in-store collection.
If the costumer chooses the ‘free shipping’ option, it is only for in-store collection. If another shipping method is chosen, the supplementary fees will be applied directly at checkout.
Cdiscount appears to favor in-store collection (click & collect).
However, there is no need to worry for vendors without a physical store: To assign the Buy Box, Cdiscount’s algorithm takes into account shipping prices, but excludes the ‘free shipping’ for in-store collection.
In the above example, even though the in-store collection option appears first, the Buy Box is attributed to the second offer, which includes a 4€80 shipping fee.
Cdiscount’s tools can adjust prices, but only to lower them…
The merchant can adjust their prices manually when selling on Cdsicount directly via their Back Office, or by using a connector (the BoostMyShop Cdiscount Connector).
Additionally, Cdiscount includes a native function that allows the merchant to define a “floor price.”
How does it work? By manually indicating a “floor price” in Cdiscount or via a connector by updating 2 supplementary fields (PriceMustBeAligned and MinimumPriceForPriceAlignment), you can define the minimum price at which you will accept to sell your product.
Once this option is activated for an offer, the sales price will be lowered automatically, cent by cent, to compete with other offers. The sales price will not fall below your pre-defined floor price.
Warning: If 2 competing offers use the floor price function, the minimum prices will be applied immediately, causing a rapid fall in your sales price.
This function creates 2 major problems:
– It makes it impossible to control one’s profit margin.
– Sales prices can only be lowered, even if competing offers disappear. Additionally, the tool will not readjust prices to raise them when competing offers are much higher!
What solutions will help me maximize revenue?
A quality Automatic Pricing tool has become indispensable for maintaining and developing sales online. Without one, precious time is wasted on manual pricing strategies and, worse, the vendor compromises their position in the market.
It is essential to identify a product’s total cost (keeping in mind variables like the transport costs and currency exchange rate…) and to include all costs related to a sale, i.e. order preparation, shipping and Marketplace commission fees.
Then comes the competitor offer overview, which should be performed as frequently as possible on whatever sales channel you’re using (Google Shopping, Amazon or Cdiscount).
This time-consuming process can be performed manually for a limited number of products, but becomes impossible when product catalogs reach over 100 items.
There are subscription-based tools available on the market that will automatically gather information on competitor prices and offers.
In addition to competitor prices, these services offer information on the different sales channels covered and the frequency of price updates.
With this information at hand, it’s up to you to determine a pricing strategy that allows you to increase sales while protecting your profit margins.
BoostMyShop’s Smart Price is a complete solution that is integrated with CMS, Magento and Prestashop, and provides automatic competitor offer updates directly to your Back Office.
Smart Price is also a high-performing Pricing tool. It allows you to determine the total cost for each product you are selling online, taking into account variable costs such as marketplace commissions.
Entirely customizable, Smart Price helps you to easily determine the right pricing strategy for your needs. Once your settings are in place, the tool goes to work to automatically adjust prices for your entire product catalog.
When it comes to Marketplaces like Cdiscount, for which you use a feed aggregator or direct connection (Magento Cdiscount Module or Prestashop Common Service), your prices are exported and updated automatically.
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