Why Should Retailers Use Group Pricing?

One of the most common methods for significantly increasing sales is to use group pricing. It enables eCommerce retailers to establish varying pricing for items based on their quantity as well as the client group. In this article, we’ll learn why group pricing is a successful feature and how to implement it on your online business.

What is group pricing?

A price group refers to a collection of prices that are applied to a specific group of clients. Simply put, it’s a technique to provide unique pricing that is different from the standard price. Businesses achieve this by grouping a number of consumers into one category and determining the pricing for that group.

When dealing with different types of clients, businesses frequently utilize group pricing. As a result, when consumers login into their eCommerce account, they will see specific discounts based on the sort of client they are.

On a larger scale, firms must determine who is eligible for discounts and what kinds of discounts are available. Wholesalers, for example, may offer lower pricing than retailers because they purchase in bigger quantities. Alternatively, loyal customers’ prices should be lowered more frequently than regular customers’ prices. Businesses can simply modify pricing methods depending on membership in a group by using price groups.

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Benefits of group pricing

Now that you know what group pricing is, what are the benefits that it can bring to retailers? Here are the most 3 prominent ones:

Build targeted marketing strategies

The beauty of group pricing is that it makes promoting and pricing your products and/or services easier and more cost-efficient. This is because it points out a focus on all of your marketing efforts. Moreover, group pricing may improve the customer’s shopping experience by allowing them to obtain discounted rates automatically and quickly on the front end. By integrating the discounted prices into the system, the admin can process orders more efficiently.

Reward wholesale customers

The prices used for a mass transaction of products are known as wholesale pricing. For example, when someone buys 100 pairs of shoes rather than one or two pairs, they are buying wholesale. The fundamental aspect of wholesale pricing is that they are cheaper than retail prices due to bulk discounts.

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To reward this type of customer, group pricing is a useful technique. You can set a price level for wholesalers and apply it to each case. This makes the whole process happen smoother and more systematically, thus minimizing errors (especially for large businesses).

group pricing wholesale

Run efficient loyalty programs

Group pricing can also help retailers reward customers more efficiently, in order to build trust and enhance the brand’s reputation. As a retailer, you can assign a special discounted price for all the clients who shop frequently at your store – as a type of appreciation for their trust in the brand. Having group pricing functions available in your system or your plan can make this loyalty program more cost and time-efficient. Moreover, this can also encourage customers to upgrade their membership card, for example, to receive better discounts. In this way, group pricing can benefit both retailers and customers, which is a clear win-win.

group pricing loyalty

When to use group pricing?

You might be wondering what are the specific customer groups that retailers can use group pricing for. Here are some examples:

For wholesalers

As mentioned before, wholesale pricing is the price you charge retailers who buy in big quantities. In general, the success of your business depends on finding the proper pricing strategy and prices for your items. Pricing has an influence on both the volume and profitability of your sales. Therefore, if you set the wholesale price too low, you risk damaging the product’s perceived worth. Worse, you may not be able to pay your costs and, as a result, risk losing money in your business. If you set your wholesale pricing too high, your items will not be appealing enough for wholesalers to buy them in large quantities.

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To support businesses in this tricky process, the group pricing function, which is often available on eCommerce platforms or point of sale systems such as ConnectPOS, is a useful tool. It can help execute the plan for retailers after they have considered and made decisions regarding all the above-mentioned points. 

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For students

Students are another group of customers that businesses often pay special attention to. By providing a student discount, even if it is a minor one, businesses can form a community around their brand that aspires to loyalty. Of course, this price group strategy is more useful and recommended if you are owning a business that offers student-friendly products. In fact, research has shown that over 97% of students who received a student discount for a certain firm said they would try their products out.

For these reasons, if you plan to use group pricing, it can be wise to offer discounts for students. Several international businesses, such as Spotify and Apple, provide student discounts, which have helped them expand their company with an audience that is already overloaded with choices.

group pricing student

For loyal customers

Loyal customers should be rewarded with discounts, which helps them feel valued. It’s a fantastic tool for retaining customers. For example, your eCommerce store is building a loyalty program, where customers with different membership cards can receive different pricing levels. In this situation, the group pricing function makes sure the price can be reduced automatically and customers can immediately see the promotional price for their membership.

For online shoppers

For businesses with both online and offline platforms, having discounts for only online shoppers is now becoming a common way to encourage customers to purchase on their eCommerce sites. Price group in this case is often included in a point of sale system, where many other business operations such as payment processing and inventory management take place. This can be beneficial in the way that it can be combined with other eCommerce features. As a result, you can track sales and price groups at the same time. 

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If you are looking for a point of sale system like this, don’t hesitate to check out ConnectPOS. You can customize which group of customers you want to implement, such as wholesalers, students, loyal customers, and even VIPs or staff. 

connectpos group pricing


After all, we hope that you can have a better understanding of group pricing after reading this blog. Do you still have questions about group pricing or our point of sale solutions? Talk with our team for more information!

About the Author

Jacey V.

Jacey V.

Jacey V. is a content marketing intern at ConnectPOS - a leading point of sale provider. Being curious about the growth of ecommerce in recent years, she has closely followed the latest technological developments and how they have facilitated businesses to grow.

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