Technology
What Walmart’s pricing changes mean for the enterprise
Walmart’s initiative is setting a new standard in the industry when it comes to embracing pricing technology.
September 9, 2024 by Pascal Yammine — CEO, Zilliant
When Walmart announced plans to equip 2,300 of its stores with digital shelf labels by 2026, the news was initially met with concern. That's probably to be expected after fast-food giant Wendy's created an uproar after saying it would begin to experiment with dynamic pricing earlier this year. While Walmart denied its digital price tags would be used for dynamic pricing, consumers are often wary of such moves due to negative implications associated with surge pricing.'
But the reality is that Walmart's initiative is setting a new standard in the industry when it comes to embracing pricing technology. As market conditions, inventory levels and inflation remain in flux, the ability to update prices and get them to the customer in real-time and without manual effort is key to maintaining a competitive edge, customer satisfaction, and ultimately, fostering a more responsive pricing environment. We call this managing the full pricing lifecycle.
The significance of this change extends far beyond Walmart's own operations, however. Enterprise companies need to take note because efficiently managing the full pricing lifecycle offers a strategic advantage not only for dealing with economic challenges but also enhancing operational efficiency and improving the customer experience.
Enhanced operational efficiency
While Walmart highlights increased productivity in its shift to digital price tags, an unintended benefit is that stores will also be able to seamlessly react to rapid market changes. No longer will store employees need to spend time walking the aisles and changing prices by hand. Prices can now be adjusted in mere seconds with a few clicks, and employees can spend time on more meaningful tasks such as inventory management and assisting customers. Additionally, the lag time from setting a price to getting it in front of customers is greatly reduced.
When thinking about this concept from an enterprise perspective, it's easy to see similarities to Walmart's needs. Adjusting prices with speed and precision is critical for maintaining business performance among market volatility and inflation. However, many organizations manage and deliver pricing with cumbersome, error-prone spreadsheets, which is an antiquated approach that can hamstring a pricing team trying to update prices or an executive team deploying new pricing strategies. As a result, companies are not able to use pricing as a strategic lever for profitability and are not able to adequately respond to today's business challenges.
Fortunately, purpose-built pricing solutions are readily available and proven to help companies seamlessly manage pricing and respond to market changes. By automating intensive, manual pricing processes, enterprise companies can free up pricing teams to consider their deeper pricing strategy and the actions needed to maximize revenue and profit.
Improved customer experience
Because digital price tags eliminate the time-consuming task of manually setting and delivering pricing to customers, the overall customer experience will undoubtedly improve. Real-time pricing changes will allow for quicker discounts and markdowns, and employees will have more time to fulfill online orders and ensure shelves are adequately stocked. More competitive and relevant pricing coupled with additional in-store support should help drive sales and customer loyalty.
Similarly, pricing technology can help enterprise organizations improve the personalization and consistency of the customer experience — specifically in digital sales channels. On an
e-commerce site, customers expect a seamless and personalized self-service experience. But if that experience is marred by prices that are inaccurate or not aligned to the market, customers
will move elsewhere. To reach business goals, you need to make the most of every interaction with customers.
Enterprises must manage their entire pricing lifecycle
Walmart's pricing evolution reflects a broader trend in the retail industry and beyond. The need for agility in today's competitive environment, where market conditions and consumer demands can shift rapidly, is essential.
Enterprises must embrace this same mindset and ensure efficient management of their entire pricing lifecycle to stay competitive, streamline operations, and enhance overall customer satisfaction. As a result, companies can not only navigate challenges more effectively but also position themselves as leaders in their respective markets.
About Pascal Yammine
Pascal joined Zilliant as CEO in 2022. He brings more than 20 years of experience in executive roles within enterprise software and business consulting, with proven leadership in developing strategic visions, developing new products and programs that can be scaled globally, and leading organizations through digital transformations.
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