Price Matching

Description

Price matching is the practice of offering to match (or even beat) the prices of competing sellers. This can be done with retail signs, adverts and other promotions.

Have a clear price matching policy and make this easily available. This will typically indicate constraints on what will be matched, for example a local store may match prices from stores within a given radius, but not online stores. If you have an online business (and even if you do not), then price matching can be automated, scraping the prices of your main competitors, although some websites act to prevent this.

Example

A home goods store has signs all over the floor saying 'Price-match guarantee: We'll meet or beat any of our competitors' prices!'. At the counter, there is a more detailed policy which names those competitors and indicates the offer does not apply to online prices.

A B2B electronic components sales company keeps a close eye on competitor products and allows its sales people to match prices as needed during sales negotiations.

Discussion

Promises to match prices offers customer the confidence to buy as you indicate that you are a 'low price' seller, at least in keeping down with competitor pricing. In fact just indicating that you offer price matching often has the effect that customers do not check competing prices as they assume that if you will match prices, you will already have reduced your prices to match your lowest competitor.

A popular practice with shoppers is to look up prices on the internet and then go into nearby shops to see if the local retailer can match the internet price. If this happens and you are prepared to move on prices quoted, you should first check yourself that the goods are indeed available (sometimes prices are quoted for goods that are out of stock) and that the supplier is credible (not all online suppliers are honest). Even then, you can keep your price higher if you can convince the customer that you offer better service (it can be difficult to return goods to online suppliers).

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Price Matching

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Theories

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