Before I start, I know it’s not the be all and end all: Being the cheapest guarantees nothing and user experience and trust are still high on the agenda, but…

Internet = mass = consumer choice

So, when you are creating a shop online, you need to offer real value to your customers. E-bay taught us that there are bargains to be had and the web has moved on even further, so it’s almost an expectation of any online shop by consumers.

Some online shops are fighting back with short-term cloaking tactics - increasing delivery charges (some e-bay sellers being a case in point) and offering prices without VAT to make them appear cheaper at the front-end. It can only lead to a disappointed customer though surely?

Competitive pricing online doesn’t just mean offering similar prices to the shop round the corner anymore. It means offering prices equivalent (if not better) to every shop out there for competing consumable products.

Yes, price isn’t everything, people are still looking for appropriate trust signals and value, but your prices count for a lot when a consumer’s best friend is a search engine.

Brand Control

Of course, your distributor may well want to control your pricing of their products, but ultimately manufacturers and their supply chain are losing that control as online retailers risk their wrath and find different channels (grey imports) to purchase from.

Finding Balance

For smaller online retailers, the key is find find the right balance. You don’t have to be the cheapest and you do need to make a profit, but how high can keep your prices and still compete?