Looks aren’t everything, but they can be when it comes to food pricing.
A new tool available this week can help food retailers assess their price image—or consumers’ perception of their overall price relative to competitors—using behavioral modeling and other technologies. These insights can help retailers identify opportunities to improve their image and align pricing with financial objectives to effectively forecast and manage their shoppers’ behavior and grow sales, according to Engage3 and Nielsen in a release announcing their new Price Image Analysis tool.
Traditionally, price indices or customer surveys have been used to estimate shoppers’ perception, but these indices alone can provide an incomplete view, according to Engage3, the Davis, Calif.-based price management firm. It says its approach—based on complex behavioral modeling that avoids bias, time delays and inaction—enables retailers to define the price image it wants to establish, and then align it with financial objectives.
“Understanding your price index is as important as it has ever been, but it doesn’t actually help you understand how your consumers perceive your pricing,” Edris Bemanian, CEO of Engage3, said in a statement. “Our strategic relationship with Nielsen unlocks an analytically driven measurement that gives retailers a clear view of their positioning relative to both their specific competitors as well as the total market. This lets them identify top investment opportunities that will have the greatest impact on their price image.”
Price investments using price image measurements enabled one customer to grow sales 2.5 times faster than they had in previous investment efforts, for about one-third of the cost, Engage3 said.
Engage3 is a member of the Nielsen Connect Partner Network, which is the largest open ecosystem of tech-driven solution providers for retailers and manufacturers in the CPG industry. Since 2016, the Partner Network has enhanced the business value of nearly 200 unique Nielsen clients by simplifying industry collaboration, offering relevant and accurate results from partners to best align how clients measure their performance.
“Price Image Analysis adds an additional layer of insight for our retail customers. Working with Engage3, we’re able to combine our data and analytic capabilities to bring something truly unique and powerful to the market, giving retailers the ability to measure and improve their price image,” said Morgan Seybert, managing director of U.S. analysis for Nielsen.