Holiday Success Depends on Retail Competitive Pricing: 4 Drivers to Watch

What’s the number one driver of price changes during the holiday season? FOMO – The fear of missing out.

In no other time does a retailer ditch their pricing strategy as quickly as than during the holidays when shoppers are actively buying and searching for value and discounts.

But here’s the irony: after the holidays, retailers step back and ask, “Did our pricing strategy actually work?”

Avoid the regret. Don’t be part of the race to the bottom. Protect margins by grounding holiday pricing decisions in competitive data, not emotion.

Retail Competitive Pricing Drivers to Watch This Holiday Season

1. Availability vs. Price Discount

A competitor’s discount doesn’t always mean it’s worth matching. Before reacting, retailers need to answer:

• Is the product actually in stock?
• Will it ship on time?
• Is supply limited?

More often than we’d like to admit, we see retailers drop prices when a product is out of stock, can’t meet the holiday delivery timeline, or is in limited supply to create an artificial pricing bottom.

And retailers blindly give into this profit compromising temptation.

The fix: avoid the unnecessary pricing dip by collecting frequent competitive data that cross references the product price with its availability. These data points give you visibility into whether a product is simply in stock or not – it gives you the information to answer the questions posed above.

2. Delivery Options & Pricing Impact

Delivery timelines are now a major component of perceived value. A “lower” price may not be a true match if it comes with longer shipping or fewer delivery options. (See more at: Are Delivery Options Drowning Out Price Differentiation in Ecommerce?)

To decide whether to match a competitive price, retailers need visibility into the delivery/shipping method and timeline to make sure that the competitive price is a 1:1 match. An exact match goes beyond product features and attributes – it also factors in delivery timeline.

Failure to collect and consider delivery and shipping data in your pricing decisions can leave you less competitive from both a pricing and deliverability perspective in the eyes of your shoppers.

3. Local, Regional, and National Pricing

Not all pricing strategies are created the same.

We hear retail customers sometimes say they don’t look at pricing the same way their competition does. Whether it’s localized, store-level pricing, regional or zone pricing, or a national pricing strategy across your portfolio, there’s a benefit to seeing your competitor’s pricing at a granular level.

For example, it may not seem relevant to view store-level pricing if you cannot make store-level pricing changes. However, this local store-specific pricing may be indicative of a shift in consumer expectation that may benefit your broader strategy.

Gathering pricing data at multiple hierarchies gives you the flexibility to look at your business from a variety of perspectives to optimize your pricing portfolio across your business and at the point of purchase.

4. New and Temporary Competition

Local delivery services like GoPuff and national delivery services like Instacart and Shipt have already put additional pricing considerations in the hands of retailers. During the holiday season, shoppers will continue to rely on these providers to aid in a convenient shopping experience which means that retailers need to be sensitive to the pricing and promotional offers available. Without visibility into these channels, retailers risk losing share or over-discounting to compete against players that aren’t even relevant year-round.

Furthermore, seasonal product assortment creates temporary competitors that you might not monitor year-round.

Turning Pricing Data into Profits with ClearDemand

The holiday season doesn’t have to be a race to the bottom. By capturing availability, delivery, regional variation, and competitive shifts, retailers can price strategically, preserve margin, and build shopper trust.

ClearDemand’s retail competitive pricing solutions give you:

• Hyper-local data that factors in stock status, delivery timelines, and competitive assortment.
• Elasticity-based insights to align price moves with customer demand.
• AI-driven optimization that balances margin protection with market competitiveness.

This holiday season — and beyond — base your pricing strategy on science, not FOMO.