Insider Intelligence delivers leading-edge research to clients in a variety of forms, including full-length reports and data visualizations to equip you with actionable takeaways for better business decisions.
In-depth analysis, benchmarks and shorter spotlights on digital trends.
Learn More
Interactive projections with 10k+ metrics on market trends, & consumer behavior.
Learn More
Proprietary data and over 3,000 third-party sources about the most important topics.
Learn More
Industry KPIs
Industry benchmarks for the most important KPIs in digital marketing, advertising, retail and ecommerce.
Learn More
Client-only email newsletters with analysis and takeaways from the daily news.
Learn More
Analyst Access Program
Exclusive time with the thought leaders who craft our research.
Learn More

About Insider Intelligence

Our goal at Insider Intelligence is to unlock digital opportunities for our clients with the world’s most trusted forecasts, analysis, and benchmarks. Spanning five core coverage areas and dozens of industries, our research on digital transformation is exhaustive.
Our Story
Learn more about our mission and how Insider Intelligence came to be.
Learn More
Rigorous proprietary data vetting strips biases and produces superior insights.
Learn More
Our People
Take a look into our corporate culture and view our open roles.
Join the Team
Contact Us
Speak to a member of our team to learn more about Insider Intelligence.
Contact Us
See our latest press releases, news articles or download our press kit.
Learn More
Advertising & Sponsorship Opportunities
Reach an engaged audience of decision-makers.
Learn More
Browse our upcoming and past events, recent podcasts, and other featured resources.
Learn More
Tune in to eMarketer's daily, weekly, and monthly podcasts.
Learn More

Pricing Optimization Is More Than a Numbers Game

Retailers feel competitive pressure, but not all are convinced AI is the answer

Price is one of the most important factors to shoppers, so it's paramount that retailers get it right.

While some may think there is an art to pricing, it's one of the most data-driven aspects of retailing, online and offline. Price optimization is also directly tied to a company's margins. In an October 2018 study by RIS, retailers in the US said that getting pricing strategy right and executing at a high level is extremely important to financial performance, rating it a 9.2 on a 10-point scale.

The biggest challenges are responding to competitive prices (45%) and changes with the marketplace, shoppers and competitors (42%). Keeping up with competitor's prices is one of retailers' greatest operational pressures, so it makes sense that, according to RIS, the most popular pricing strategy is indexing prices to specific competitors (34%).

A majority of retailers (55%) use a mix of pricing software and spreadsheets while 42% rely solely on spreadsheets. Old habits die hard, which was reinforced by respondents rating artificial intelligence (AI) only a 3.9 in importance. Most did not fully understand how emerging tech like AI fits in, even though dynamic pricing isn't a new concept in retail merchandising.

Retailers believe this tech could help them implement dynamic pricing to compete with Amazon and Walmart (47%) and provide shoppers with fair prices, as well as healthy margins for themselves (45%).

However they implement consistent pricing, it was the omnichannel capability that retailers in North America had most deployed and were satisfied with (31%), according to an April 2018 survey conducted by Boston Retail Partners (BRP). An additional 34% of respondents said they had implemented it, but it was still a work in progress. 

The retailers in the RIS study were also on top of pricing optimization. More than one-third (35%) of US retailers said their pricing software was up-to-date and an additional 11% were in the midst of upgrading. Fewer than one-quarter (22%) of respondents had no plans to upgrade, similar to the 18% in the BRP survey.

Consumers were only referred to tangentially in this study, though retailers acknowledged that shoppers wanted fair prices. Dynamic pricing has a mixed reputation among shoppers, especially when they can see prices fluctuating day to day for seemingly no good reason. Shoppers are more receptive to non-static pricing when price changes don't feel arbitrary or are based on personal shopping habits.