How to prevent against the price war in e-commerce?


In the early 2000s, e-commerce in Brazil experienced an astronomical expansion: several people saw the new business modality as the new “Eldorado”. And it was thanks to the exponential growth of online retailing, which for a long time sustained relatively fast ROI promises, that many Brazilian entrepreneurs decided to bet on the great moment of virtual stores as a shortcut to success.

In this way, thousands of e-commerces emerged, fueling competition at predatory levels and forcing shopkeepers to face an uncomfortable price war, which occurred in the offer of free shipping, discounts and more “comrades” installments, for example. There were cases, even, of virtual stores that offered a comparison of prices of its competitors, to prove the status of “barateiro”.

This price war is very interesting from the point of view of the average consumer. After all, who does not like to pay cheaper? However, this strategy often means the ruin of many virtual stores precisely because it undermines the final profit margin and hence the financial health of the business.

But in an environment where competition is too aggressive, what to do? How can I maintain the sustainability of my prices without losing the attention of my consumer? It happens that, in e-commerce, the price war is just one of the resources of customer loyalty.

Now, as in this Red Ocean that online retailing has become, are there companies that have emerged and become benchmarks in the industries in which they operate? How did they take the lead role? The answer lies in building a strong brand.