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Will Price Matching Make or Break your eCommerce Business?

Price matching in eCommerce has one major advantage, and that is customer loyalty. Although it comes with several challenges, one thing is for sure: a loyal customer is a buying customer.

For that reason, employing price matching as the main eCommerce pricing strategy or in combination with other solutions is for sure a win for eCommerce owners.

But it has limitations - it's not always good, and certainly, it's not for all business types and sizes. Keep reading and discover the pros and cons of price matching and how to get the best out of this strategy for eCommerce owners and dropshippers.

What is price matching?

Price matching is a promise by a store to match a competitor's price. If a customer finds a product cheaper elsewhere, the store will sell it at that same price.

It’s all about building trust. Customers know they're getting the best deal. It can also increase sales. People prefer to shop where they get the best value.

How Does It Work?

This is the most basic example that can be further adjusted to protect your business 

  • A customer finds the same product cheaper on another site
  • They show it to the store
  • The store verifies it
  • The store offers the product at the matched price


  • It must be the exact same product
  • Customers should show proof of the lower price (a link or a screenshot)
  • Some stores offer price matching only for a short time after purchase
  • Not all items may qualify (for example, clearance items might be excluded)

And why this might be good for your business?

  • People return to stores that offer good deals
  • Your store can compete with bigger sellers
  • Customers won’t wait - they’ll buy if they know they’re getting the best price

Still, you should watch out for scams. Some might try to show fake evidence of lower prices. Verify before matching!

Also, the most important thing in completely employing price matching is making sure not to hurt your margins. You must ensure you’re still making a profit when matching prices.

And a tip that’ll be further explained later - Don't let everyone demand a price match. It's a special service, not a regular discount.

Pros and cons of price matching in eCommerce

A decade ago, Best Buy faced challenges from the eCommerce boom, with many consumers using its stores as showrooms before purchasing cheaper alternatives online. 

However, in 2013, Best Buy strategically began matching the prices of major online retailers like Amazon, transforming its business model. This move not only revitalized Best Buy but also set a precedent for other retailers. 

By 2022, 42% of top retailers, including online-only giants like Newegg Commerce, adopted similar price-match guarantees, cementing its importance in today's competitive retail landscape.

One thing is for sure - giants with huge inventories can find a lot of success with the price-matching strategy. And what about small eCommerce businesses?

Obviously, smaller businesses, especially dropshippers, cannot afford to change prices on every customer's demand. But, they can employ some of the practices of price matching, such as:

  • Limited-time offers: Adjust prices for short promotional periods to create urgency.
  • Match Selected Competitors: Choose a few primary competitors to match rather than trying to compete with everyone.
  • Value-added services: Enhance customer experience with faster shipping, extended warranties, or top-notch support.
  • Loyalty programs: Offer discounts or rewards for repeat customers, ensuring they return even if a competitor has a slight price advantage.
  • Bundling products: Combine products and offer a discounted package price, providing more value than competitors selling items individually.
  • Transparency: Clearly communicate why your prices might be higher, such as higher quality, sustainability, or local sourcing.

And, finally…

Pros of Price Matching:

  • Builds customer trust
  • Increases sales potential
  • Enhances brand reputation

When a store offers price matching, it signals to the customer that they won't be overcharged. Customers feel that the store is putting their interests first, ensuring they get the best deal. Over time, this builds trust as customers believe the store values fairness.

Also, customers are more likely to purchase from a store if they know they are getting the best possible price. They might even buy more than they initially planned because of the perceived savings.

Word-of-mouth is everything when it comes to brand reputation. When customers have positive experiences due to price matching, they're more likely to tell others. This positive feedback enhances the store's reputation as a trustworthy and customer-centric brand.

Cons of Price Matching:

  • Reduces profit margins
  • Risks of price wars
  • Can be exploited by savvy shoppers

By matching a competitor's lower price, the store may be selling its products at a cost closer to (or even below) what it paid for them. This means the profit they make on each sale is reduced.

And to make it even worse, when one store decides to lower its prices, competitors might respond by dropping theirs even further. This can lead to a continuous cycle of price reductions, known as a "price war." While consumers benefit from lower prices, businesses can suffer as they continuously undercut each other, making it hard to maintain profitability.

When it comes to savvy shoppers, some are exceptionally good at hunting for deals. They may find ways to take advantage of price-matching policies, such as presenting prices from obscure sources or exploiting minor price differences frequently. This can lead to the store constantly offering discounts, impacting their bottom line.

Now you might wonder how to employ a price matching strategy to your store - be it partially or to rely your business fully on this particular pricing strategy.

Price matching can be a game-changer for store owners. But…

How to do price matching effectively? 

Here's a basic guide.

1. Decide on a Policy:

Before diving in, make a plan.

  • Which competitors will you match?
  • Will you match from a certain category of products or your whole offer?
  • What do you need as proof of the lower price, like an ad or a receipt?

Decide these things first. Then, let your customers know about your policy. Make it transparent!

2. Keep an eye on competitors:

To match prices, you need to know what others charge. Here's how to do it:

By hand: Old-school, but it works. Visit competitor stores. Check their websites. Make a list of key products and their prices. Update it regularly.

Software: There are tools out there to help. Price monitoring software can track competitor prices for you. They'll alert you when prices change. Some popular options include Prisync, Price2Spy, and Competera.

Hire help: Consider hiring a team or a service. They can track prices for you. It's more hands-off but might cost more.

3. Train your team:

Your staff needs to know the policy. Train them on:

  • How to handle price match requests
  • How to verify competitor prices
  • When to say no

4. Review and adjust:

Price matching isn't set-and-forget. Maybe you're matching prices too often. Or not enough. Review your policy regularly. Adjust as needed.

5. Beware of risks:

Remember, some shoppers are savvy. They might try to take advantage. Always verify prices before matching. And stick to your policy. It's there to protect you.

In Conclusion

Price matching can boost your store's reputation and sales. But it's essential to do it right. Watch competitors, set a clear policy, and stay flexible. With the right approach, you can make price matching work for you.

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