Retailers typically compete on price in one form or another. While the strategy for an everyday low price (EDLP) retailer is certainly different than a hybrid-EDLP or a high-low retailer, price remains paramount as margins decline to an all-time low. Yet, despite its importance, price remains one of most mismanaged areas in consumer goods retailing. Willard Bishop uses a proven approach to developing integrated pricing strategies that improve competitive positioning and encourage consumers to shop the store more intensively on each trip – All while supporting the retailers’ shopper-value equation and capturing lost margins.
The Willard Bishop integrated pricing matrix includes:
- Everyday Shelf Prices
- Promotional Offerings
- Known-Value Item Prices
- Per Unit/Value Prices
- Price Communication
Price Communication is one of the most important elements in an effective pricing strategy. Retailers may have solid pricing practices in place, yet shoppers fail to acknowledge, or don’t realize, the values being offered. To help retailers get full credit for their aggressive prices and their value proposition, Willard Bishop uses primary and secondary research to benchmark the price-perception performance gap. Next, Willard Bishop develops new price messaging to close the gap. The new messaging is then distributed across all communication platforms, including in-store, print, online, and digital.
The battle for capturing more share of wallet continues to intensify as the percent of promoted items reaches new heights. For many retailers, more than 50% of their total sales are promotion related. Willard Bishop helps retailers develop promotion strategies that support the retailer’s overall business objectives, while maximizing the return on every promoted dollar. Willard Bishop also works collaboratively with retailers and manufacturers to ensure trade spending and internal promotional allocations increase store traffic, sales, and ultimately profits.
The percent of sales from promoted goods is at an all-time high; however, the true impact of these promotions is often unknown due to multi-department tie-ins and inability to determine the tradeoffs between increased traffic and lower margins. To optimize promotions, Willard Bishop uses sophisticated, pooled demand forecasting to determine the optimal mix of products and price points. Demand sensitivities and price elasticities are modeled and recommendations are made for digital offerings, ad circulars, and temporary price reductions (TPRs).
Related reading: AD-IN Promotion Optimization Solution