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Mystery Price Audits - A must for Retailers !

Author: ResearchFox

 

 

Mystery audit is an effective research tool used to evaluate the quality of  Consumer-brand interactions and aims to improve customer experience. This will also be an effective tool for the ecommerce players to positioning their products at right price which take them ahead in competition. Price audits  is a form of mystery audits and are carried out with an objective of studying and knowing its competitors, in order to compare their pricing strategy and ensure fixing the right price to their products/services.

The mystery shopping price audits requires experienced mystery shoppers with a track record of conducting such audits who disguise themselves as buyers and walk-in to the shops/stores/outlets to check for a product, evaluate a product for its price and specifications negotiate and collect the prices. He/she should possess certain skillsets including keen observation and negotiation skills, which is the key to winning the price audits. One of main objective of the price audits is to Arrive at an optimal price range for the product/service so as to leverage its position against the competition.  Mystery price audits are found to be the cost-effective methods and the retail industry frequently uses this methodology to be on par with its competitors in the market. It not only helps the companies to become competitive in the market but also provide right prices to its buyers.

A brand can utilize mystery price audits to uncover the deep understanding at strategic touchpoints:

  1. Brand - Brand can do the study for their own product/service which can then be aligned or validated with their internal strategy.
  2. Competition – It is done to understand the price range competition is commanding in the market. This type of research comes handy especially while launching a new brand in market.
  3. Intermediate agents (Retailers, Distributors etc.) – Price may vary by retailers & distributers which may lead to varied customer experiences, this can be understood and tackled well with price audit study.

There are many challenges a mystery shopper faces;

  1. The prices procured from the competitors requires evidences in the form of quotations, audios and videos, hence collecting these evidences is a challenge.
  2. The shop owners will not share the quotations and reveal their retail prices unless a purchase is made even after negotiating the price for a product.
  3. Taking a picture of the products or recording a video is not allowed as the shop owners find it as a threat of competition.
  4. The market price for most of the products keeps varying especially the electronic gadgets like mobiles, laptops. This will lead to instability in the prices.
  5. The neighboring stores also pose a major competition in the offline retail/wholesale market who also have an eye on their pricing strategy, which will not help mystery shoppers in getting the correct price for many products.
  6. In many cases, the person in-charge of the small stores will not be literate and often mishear the product names and share the wrong prices.
  7. As online shopping is a norm these days and due to many offers and discounted prices, the buyers often purchase them online than visiting the retail/wholesale stores, hence result in the non-availability of the products in these stores.

 Deep insights from mystery price audits  are effective to  a brand, as the prices procured are benchmarked with the competitor’s prices, analyzed and pricing decisions are made. The price audits also help in competitor analysis for a wide segment of products/Services like electronics, furniture, clothing, grocery, beauty etc. for different Indian cities especially the Tier 1 cities like Bangalore, Mumbai, Chennai, Hyderabad, Delhi.   

Contact us at explore@researchfox.com to explore more around price audits.

 

 

 

 

 

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