October 31, 2022

Above and Below

Remember, we have an item that normally sells for $49.99. Sometimes the brand offers blanket 30% off promotions, so when that happens the item sells for $34.99. When it sells for $49.99, the item sells at/above the historical average price point for the item. When the item sells for $34.99, the item sells below the historical average price point for the item.

Here's the percentage of items selling below their historical average price point, by month, for the past year. Tell me what you observe:

  • 48% = November 2021.
  • 67% = December 2021.
  • 36% = January 2022.
  • 14% = February 2022.
  • 13% = March 2022.
  • 17% = April 2022.
  • 19% = May 2022.
  • 22% = June 2022.
  • 33% = July 2022.
  • 34% = August 2022.
  • 24% = September 2022.
  • 16% = October 2022.

What did you observe?

Well, this brand is giving the item away in November/December, correct? They're trying to stimulate business in the dead of summer and they're giving the item away when they have ample traffic.

I'll get complaints now ... "you don't understand, we have to be competitive on pricing at Christmas or our competitors will eat our lunch".

Maybe you are right.

Ask yourself what it means if you are wrong?


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