Pricing Practices News

Overstock.com’s dropship model is margin-solid ‘come hell or high water’

Overstock.com’s dropship model is margin-solid ‘come hell or high water’

Overstock.com had a challenging 2022, but it could have been worse. The online furniture and home goods retailer reported a 30 percent year-over-year revenue decrease and a net loss of $35 million. How do you see Overstock.com positioned against its rivals in the furniture and home goods space for 2023?

Is inflation giving grocers a bad rap?

Is inflation giving grocers a bad rap?

Shoppers believe grocers are making 14 times more profit than they actually are and also believe food-at-home inflation is about two times higher than reality, according to a new dunnhumby analysis. Are grocers in a “precarious position with their brand perception” in the face of rampant food inflation?

Walmart gets the attention of shoppers with egg-ceptional prices

Walmart gets the attention of shoppers with egg-ceptional prices

Walmart is known for its everyday low prices on products across the store, but a recent offer of a carton of 18 eggs for $2 at a store in Kentucky raises questions about how this particular location was able to offer a price so low. How much are Walmart and other large retailers able to influence pricing on commodities such as eggs?

Should grocers be demanding price decreases from suppliers?

Should grocers be demanding price decreases from suppliers?

At a virtual meeting in December, Whole Foods implored suppliers to lower costs on packaged groceries as inflation moderates. Do grocers have the leverage it takes to strong-arm their suppliers into reducing prices?

Close up image of customer using checkout screen

Which drives you crazier? ‘Tipflation’ or tip creeping?

Tipping fatigue has been trending as a topic in the media and has sparked angry debates on social media for nearly a year. The arguments now appear to center on two different phenomena: “tipflation” and tip creeping. Do you see tipflation or tip creeping as the bigger driver of tipping fatigue?

2023 could be the year of the recession that never happened

2023 could be the year of the recession that never happened

The economic recession of 2023 will not be televised. That’s because it appears unlikely to happen, despite predictions of its inevitability from economists, bankers, analysts and others. What factors do you think will have the greatest impact on retail industry performance for the balance of 2023?

What does Amazon know about delivering groceries that others don’t get?

What does Amazon know about delivering groceries that others don’t get?

Amazon Prime members who have gotten their groceries delivered for free with a minimum purchase of $35 will now have to spend at least $150 if they want to avoid paying a fee starting on February 28. How do you expect Prime members will react to Amazon’s new requirements for free grocery delivery?

Will consumer anger drive down inflation?

Will consumer anger drive down inflation?

Consumers are fed up with escalating inflation, prompting some companies to restrain their price hikes to offset cost pressures. Will consumer resistance to higher prices likely be the primary factor driving down inflation?

Should Dollar General sweat its former CEO taking over at Dollar Tree?

Should Dollar General sweat its former CEO taking over at Dollar Tree?

Dollar Tree yesterday said that its executive chairman, Richard Dreiling, has been named CEO of the company. He replaces Mike Witnyski who has led the company since last year after serving in leadership positions with Dollar Tree going back to 2010. What impact do you expect Rick Dreiling to have on Dollar Tree and Family Dollar?

Does retail need a data-based rebuild?

Does retail need a data-based rebuild?

Australian supermarket Woolworths has succeeded in using analytics to inform and redesign a number of processes core to its business in a short amount of time, as outlined in a session at the NRF 2023 Big Show. Do you agree with the claim that most retailers’ core processes need to be fundamentally reimagined using data?

Will reducing organic fraud help justify higher prices?

Will reducing organic fraud help justify higher prices?

In the biggest update since organic standards were first established in 1990, the U.S. Department of Agriculture announced new guidelines designed to close loopholes and increase confidence in the often pricier product bearing the agency’s organic seal. Will stricter certification guidelines significantly improve the price integrity around organic products?

Macy’s gains control of its inventory and markdowns

Macy’s gains control of its inventory and markdowns

At the NRF Big Show, Jeff Gennette, Macy’s CEO, discussed how process changes and improved data science helped the retailer overhaul inventory disciplines over the pandemic. Are more retailers using data science to tailor markdowns by “door and channel” as Macy’s is doing?

Consumers get some relief as inflation eases

Consumers get some relief as inflation eases

American consumers continued to spend as prices rose steadily higher from 2021 to June 2022. Will they keep up the shopping pace as prices go in the opposite direction? How might a further easing of inflation affect consumer spending?

Are ‘price frictions’ undercutting product sales?

Are ‘price frictions’ undercutting product sales?

A new university study finds some retailers may be slower to reduce prices to stimulate sales due to “price frictions,” for example, reluctance to move away from prices that end in 99 cents.  Are the pricing frictions cited in the article a major impediment to price optimization?

Will 2023 be all about value?

Will 2023 be all about value?

With customers continuing to seek lower-priced shopping options due to inflation, the major players in value retailing are already far outpacing others in opening new stores in 2022 and appear to be riding mighty tailwinds heading into 2023. How much of the expansion success by dollar stores, budget grocers and other value-first chains depends on enduring inflation?

Will Amazon’s antitrust battles get worse before they get better?

Will Amazon’s antitrust battles get worse before they get better?

Amazon has made several commitments related to business practices in Europe as part of settlement over alleged unfair treatment of third-party sellers. Do Amazon’s concessions under the European Union settlement appear fair to Amazon and third-party sellers?

Will Walmart throw high-price suppliers off the shelf?

Will Walmart throw high-price suppliers off the shelf?

Inflation has become enough of an issue to rattle Walmart’s everyday low price positioning and the chain is considering taking a drastic move that may keep its customers happy, but likely have the opposite effect on some of its suppliers. How effective will Walmart’s threat of delisting products be in getting center store grocery suppliers to moderate prices?

Will 2023 become the year that consumers get comfortable with dynamic pricing?

Will 2023 become the year that consumers get comfortable with dynamic pricing?

This holiday season has ushered in a period of peak price-sensitivity. Consumers continue to wonder whether or not we’re in a recession, and while spending is continuing on, there’s certainly an understanding that times are tougher. Do you think consumers trust that retailers are giving them good deals when they see fluctuating prices?

Will persistent theft compel Walmart to raise prices or close stores?

Will persistent theft compel Walmart to raise prices or close stores?

Walmart CEO Doug McMillon yesterday told CNBC that his company has a growing theft problem. Mr. McMillon said that theft has reached levels that are “higher than what’s historically been” the case for the retailer. “If that’s not corrected over time, prices will be higher, and/or stores will close,” he said. Do you see Walmart raising prices or closing stores in some areas in response to increasing theft?

Retailers find inflation is often about location, location, location

Retailers find inflation is often about location, location, location

Inflation is a top concern for both businesses and consumers currently, and rightfully so as the U.S. trend continues to remain high. What do you see as the most effective tactics for retailers trying to hold the line on inflation for their customers?

Is being the low price leader critical to Amazon’s ongoing success?

Is being the low price leader critical to Amazon’s ongoing success?

A study finds online prices are on average 13 percent less expensive on Amazon.com than other leading U.S. retailers across 15 categories, narrowing from 14 percent lower in 2021 and 16 percent in 2020. Is price still the primary reason consumers choose to shop on Amazon?

Retailers are using newfound clout to put the squeeze on suppliers

Retailers are using newfound clout to put the squeeze on suppliers

With inventories elevated in many categories and the economy slowing amid inflationary pressures, larger retailers are using reclaimed leverage to cancel orders, fight price increases and seek out concessions from suppliers. Do you see indications that retailers regained leverage against their supplier base amid excess inventories and inflationary pressures?

Will dynamic pricing work for restaurants?

Will dynamic pricing work for restaurants?

The restaurant industry is debating the merits of dynamic pricing as the expansion of digital menus over the pandemic has made instant price changes easier. The big unknown is how patrons will react. Do you see more potential benefits or drawbacks to dynamic pricing at restaurants and other foodservice establishments?

Aldi and Walmart are turning back the clock on inflation for Thanksgiving

Aldi and Walmart are turning back the clock on inflation for Thanksgiving

Aldi and Walmart are running Thanksgiving meal promotions that promise to help their customers save as though grocery prices haven’t spiked 13 percent in 2022. Are Americans significantly more price sensitive heading into this year’s Thanksgiving Day feasts than they were in 2021?

Can VF Corp. reset its path to profitable growth amid escalating promotions?

Can VF Corp. reset its path to profitable growth amid escalating promotions?

Facing a heightened promotional environment amid elevated inventories in the marketplace, VF Corp. has rejiggered its near-term plans to drive higher revenue and profit in the second half of its fiscal year ending March 2023. What do you think is key to preserving profitability in an environment marked by elevated promotions and inventories?

Canada investigates grocers over charges of price gouging

Canada investigates grocers over charges of price gouging

With inflation driving grocery prices sky-high over the last year, the Canadian government is stepping in to determine whether or not grocers have been gouging. Do you think U.S. grocers will come under pressure similar to what is taking place in Canada should food inflation continue to rise?

Has tipping for takeout become a social norm?

Has tipping for takeout become a social norm?

According to a recent survey, 67.7 percent of Americans feel pressured to tip when picking up takeout food or coffee if the POS system prompts them to, and 44.8 percent only tip because a POS tablet prompts them to do it. Do you think touchscreen payment tablets with tip suggestions for takeout orders are irritating and/or manipulative?

How can grocers prevail in inflationary times without winning on price?

How can grocers prevail in inflationary times without winning on price?

Grocers not known for rock-bottom prices can minimize the damage in competing against low-price leaders  — and potentially strengthen bonds with customers — by keeping price gaps tight while using best practices in executing mass promotions, communications, personalization and private branding. How can traditional grocers best compete in inflationary periods against low-priced leaders?

Is the “pink tax” on women’s personal products justified or unjustified?

CVS battles the ‘pink tax’

CVS is slashing prices on its menstrual products and working to eliminate sales tax on such items across states as part of a broader push against the “pink tax,” a term referring to the premium women tend to pay versus men for personal health goods. What do you think of CVS’s moves to reduce prices on menstrual and other personal products?

Do grocers have a price perception problem?

Do grocers have a price perception problem?

Food prices are rising, no doubt, but apparently American consumers think they are paying way more than price tracking statistics show is the reality. Does the grocery industry have a price perception problem?

FTC commissioner says it’s time to enforce the Robinson-Patman Act

FTC commissioner says it’s time to enforce the Robinson-Patman Act

Independent grocers and pharmacies may have found the ally they are looking for. Alvaro Bedoya, commissioner of the Federal Trade Commission said that the current imbalance that favors large businesses over small players can be solved by enforcement of the Robinson-Patman Act. Should the Federal Trade Commission enforce the Robinson-Patman Act more vigorously?

Dollar General plans to expand its selection of $1 items

Dollar General says it is not abandoning the pricing on its selection of $1 products, even as inflation continues to drive retail prices up nationwide. How important is the $1 price point to Dollar General shoppers?

Is ‘shrinkflation’ a better option than charging higher prices at retail?

Is ‘shrinkflation’ a better option than charging higher prices at retail?

A recent Morning Consult survey concludes that only 25 percent of U.S. adults have failed to notice “shrinkflation” in any grocery categories, and many that have are seeking alternatives. How open should retailers be to accepting shrinkflation moves from vendors?

Will Sam’s Club customers be okay with paying a higher membership fee?

Will Sam’s Club customers be okay with paying a higher membership fee?

Sam’s Club is increasing the price of its annual membership options for the first time in nine years. The increase comes at a time when the chain’s sales have been on the upswing as members turn to the warehouse stores to save money at a time of high inflation. Do you think Sam’s Club members are open to paying more for their memberships at this point in time?

Should grocers make a big deal out of freezing prices?

Should grocers make a big deal out of freezing prices?

On Walmart’s second-quarter conference call, Doug McMillon, CEO, said the retailer’s merchants are focused on “holding prices down or rolling them back” across categories based on demand. Should retailers be doing more to publicize their efforts to selectively hold or reduce prices at this time?

Full-price clothing retailers me-too off-pricers with a packaway inventory strategy

Full-price clothing retailers me-too off-pricers with a packaway inventory strategy

Gap, Express and Kohl’s are among the retailers getting ready to employ packaway sales to reduce the markdown blow of last holiday’s late deliveries. Has packaway become a more standard and less risky practice for full-price retailers looking to maximize inventory clearance?

What tradeoffs are consumers willing to make to stretch their food dollars?

What tradeoffs are consumers willing to make to stretch their food dollars?

A new survey finds 76 percent of U.S. consumers saying their family has changed how they buy food with prices on the rise. Do you suspect grocery shopping behavior will follow patterns seen in recent downturns or do escalating food prices and other factors throw that out of alignment?

What should the free shipping threshold be?

What should the free shipping threshold be?

Kohl’s said its online sales in the second quarter benefited from higher conversion rates, driven largely by a move to lower its free shipping threshold on order size to $49 from $75. How should the order size threshold for free shipping be determined?

Have restaurant meals become a better deal than food from grocery stores?

Have restaurant meals become a better deal than food from grocery stores?

The conventional wisdom has long been that you are financially better off making food at home than splurging on eating out. But the inflationary economy might be flipping that logic on its head. Will U.S. consumers shift more food dollars to restaurants through the balance of 2022?

Is inflation the biggest back-to-school story?

Is inflation the biggest back-to-school story?

Deloitte, KPMG and Mastercard all issued “Gold Star” back-to-school spending forecasts in the range of 7.5 percent to nine percent, attributing spending increases in part to inflation. Do you agree that back-to-school is largely an “essential category” and somewhat immune to inflationary pressures?

Should marketing have more control over pricing?

Should marketing have more control over pricing?

Traditionally, chief marketing officers have oversight over promotions to get products out, but not much influence on initial pricing as products come in. Should marketing play a larger role in setting initial pricing, particularly during inflationary times?

Are grocers profiteering from inflation?

Are grocers profiteering from inflation?

In a tweet Tuesday, Gail Vaz-Oxlade, a Canadian celebrity money expert, called for a boycott of Loblaws, encouraging followers to “join in sending a message to the Loblaws group that you do NOT appreciate their profiting and calling it ‘inflation.’” How would you define profiteering in the current inflationary climate and are certain grocers and food manufacturers guilty?

Dynamic pricing may be ‘stuck in the mud somewhere in the swamps of Jersey’

Dynamic pricing may be ‘stuck in the mud somewhere in the swamps of Jersey’

An uproar ensued last week after fans of Bruce Springsteen found some tickets to his first tour in six years fetching prices in the range of $4,000 to $5,000 due to Ticketmaster’s “dynamic pricing” model. What lessons does the fuss over Bruce Springsteen’s ticket pricing offer retailers and brands around the use of dynamic pricing?

Will the ‘Credit Card Competition Act’ lead to lower prices for retailers and consumers?

Will the ‘Credit Card Competition Act’ lead to lower prices for retailers and consumers?

Retail trade organizations have come out strongly in support of new legislation that would enable retailers and other merchants a choice of which companies process credit card transactions. Will the “Credit Card Competition Act of 2022” result in lower swipe fees for retailers?

Can Walmart roll back inflation?

Can Walmart roll back inflation?

Walmart got Wall Street’s attention yesterday after it lowered its profit outlook for the second quarter and the full year.  Do you think markdowns by Walmart, Target and other large retailers can blunt the effect of inflation on the U.S. economy over the second half of 2022?

Are Millennials the reason that inflation is so high?

Are Millennials the reason that inflation is so high?

The movement of the massive Millennial generation into peak spending patterns is playing a major role in driving inflation, at least according to one investor. Do you agree that the timing of Millennials reaching their prime spending years is a major factor causing inflation to spike?

Should Costco raise its food court prices?

Should Costco raise its food court prices?

Costco last week earned widespread media coverage for raising prices on two popular items on its food court menu, the chicken bake and 20 oz. soda. Is holding prices on most food court items more important for Costco than on grocery prices?

Will consumers become even more frugal post-pandemic?

Will consumers become even more frugal post-pandemic?

A recent survey found 54 percent of Americans consider being called “cheap” a compliment at times and 53 percent are proud of being labeled a bargain hunter. Do you think consumers are likely becoming more frugal or less so post-pandemic?

Are outsized private label gains in grocery a foregone conclusion?

Are outsized private label gains in grocery a foregone conclusion?

As inflationary pressures and a potential economic downturn force consumers to trade down, store brands have more going for them than low prices. How likely is it that store brands in the grocery channel will gain meaningful share over the next two years?

Kroger CEO says customers are ‘rethinking their shopping’ habits

Kroger CEO says customers are ‘rethinking their shopping’ habits

Kroger is finding that grocery shoppers are  trading down and shifting to store brands as U.S. inflation hits a four-decade high, and seeing a particular shift from lower-income households. How have you been seeing inflationary pressures altering grocery shopping habits?