{"id":1023,"date":"2019-05-29T16:21:15","date_gmt":"2019-05-29T13:21:15","guid":{"rendered":"https:\/\/pricecop.net\/?p=1023"},"modified":"2026-02-20T13:07:18","modified_gmt":"2026-02-20T10:07:18","slug":"demping-im","status":"publish","type":"post","link":"https:\/\/pricecop.net\/en\/blog\/demping-im\/","title":{"rendered":"Why are online retailers dumping?"},"content":{"rendered":"<p><\/p>\n<p>The seemingly simple answer to the question, \u201cWhy do online stores engage in dumping?\u201d is \u201cto sell!\u201d<\/p>\n<p> <!--more--> <\/p>\n<p>But if you look into the real motives and schemes, you\u2019ll understand the factors that trigger dumping in online stores.<\/p>\n<p> <img decoding=\"async\" class=\"aligncenter size-large wp-image-1270 lazyload\" data-src=\"https:\/\/pricecop.net\/wp-content\/uploads\/2020\/02\/chomu-dempinhuiut-internet-magazyny.png\" alt=\"Why do online stores engage in dumping?\" width=\"770\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" style=\"--smush-placeholder-width: 770px; --smush-placeholder-aspect-ratio: 770\/433;\" \/> <\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>Pioneers, with heads of iron, souls of tin, devils possessed!<\/i><\/p>\n<p class=\"content-list\">Content List<\/p>\n<ul>\n<li><a href=\"#content-list-title-1\" title=\"Entering the market\">Entering the market<\/a><\/li>\n<li><a href=\"#content-list-title-2\" title=\"Discounts and special offers for purchasing goods\">Discounts and special offers for purchasing goods<\/a><\/li>\n<li><a href=\"#content-list-title-3\" title=\"Warehouse\">Warehouse<\/a><\/li>\n<li><a href=\"#content-list-title-4\" title=\"The domino effect \u2014 a reaction in kind\">The domino effect \u2014 a reaction in kind<\/a><\/li>\n<li><a href=\"#content-list-title-5\" title=\"Switching to a competitor\u2019s brand\">Switching to a competitor\u2019s brand<\/a><\/li>\n<li><a href=\"#content-list-title-6\" title=\"Uncoordinated price list updates\">Uncoordinated price list updates<\/a><\/li>\n<li><a href=\"#content-list-title-7\" title=\"Dumping after hours \u2014 evenings, nights, and weekends\">Dumping after hours \u2014 evenings, nights, and weekends<\/a><\/li>\n<\/ul>\n<h2 id=\"content-list-title-1\">Entering the market<\/h2>\n<p>The fastest way for a newcomer store \u2014 a \u201cpioneer\u201d \u2014 to start selling online is to set minimal prices and run ads. Their chances of making sales increase significantly when established market players follow the recommended retail price (RRP). The newcomer\u2019s prices may look very attractive, enticing customers to buy cheaper while protecting themselves by paying upon receipt.<\/p>\n<p>Some pioneers don\u2019t even have contact with certain suppliers but \u201ctest\u201d the market by adding various products to their web storefront. In doing so, they pursue at least two benefits:<\/p>\n<p>\u2014 Suppliers themselves find these online stores and establish partnerships;<\/p>\n<p>\u2014 Interested customers place an order for one product but get offers to buy a different one (more on that below).<\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>A request for a discount doesn\u2019t signal poverty but frugality.<\/i><\/p>\n<h2 id=\"content-list-title-2\">Discounts and special offers for purchasing goods<\/h2>\n<p>Practically every supplier or distributor offers discounts and special deals to retailers, further stimulating sales. In wholesale, these can include:<\/p>\n<ul>\n<li>free delivery to the store\u2019s warehouse for orders above a certain amount;<\/li>\n<li>special prices or bonuses for achieving monthly turnover targets;<\/li>\n<li>a one-time discount on buying a batch of one or several product models;<\/li>\n<li>an extra discount for avoiding accounts receivable;<\/li>\n<li>seasonal closeouts.<\/li>\n<\/ul>\n<p>These and other types of attractive offers from suppliers encourage retailers to \u201ctake more\u201d for their own warehouses. But if they realize they\u2019ve \u201cswallowed too much,\u201d they have to play with prices to clear inventory.<\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>\u201cWhere\u2019s Grandma?\u201d<\/i><\/p>\n<p style=\"text-align: right;\"><i>\u201cI\u2019m here in her stead&#8230;\u201d<\/i><\/p>\n<h2 id=\"content-list-title-3\">Warehouse<\/h2>\n<p>Both established and new online stores with their own warehouse may end up with slow-moving goods. Sales and promotions help them:<\/p>\n<ul>\n<li>reduce or clear out warehouse stock;<\/li>\n<li>free up working capital;<\/li>\n<li>sell seasonal items;<\/li>\n<li>remove certain categories or brands from their product range.<\/li>\n<\/ul>\n<p id=\"domino\" style=\"font-weight: 400;\">Such actions lead to the following consequences.<\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>The Falling Domino Principle&#8230;<\/i><\/p>\n<h2 id=\"content-list-title-4\">The domino effect \u2014 a reaction in kind<\/h2>\n<p>Deliberate dumping is initiated by online stores that certainly know the recommended prices. Someone starts dumping first to \u201cskim the cream\u201d in this simple way. Once a critical mass of competitors engages in dumping, almost all other players inevitably respond to the market situation.<\/p>\n<p>Like toppling dominoes, a chain reaction ensues \u2014 forced response to <a href=\"https:\/\/pricecop.net\/en\/shop\/\">competitors\u2019 slashed prices<\/a>.<\/p>\n<p>In such cases, prices on the dumped brand\u2019s goods can only be stabilized in a short timeframe; otherwise, it becomes an endless game.<\/p>\n<div style=\"text-align: center;\"><strong>Are you a representative of an online store?<\/strong><\/div>\n<div style=\"text-align: center;\"><strong>Find out right now at what prices competitors are selling in Ukraine \ud83c\uddfa\ud83c\udde6<\/strong><\/div>\n<p> <iframe data-src=\"https:\/\/pricecop.net\/demo\/shop.php\" width=\"100%\" height=\"500\" src=\"data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==\" class=\"lazyload\" data-load-mode=\"1\"><\/iframe> <\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>\u201cDon\u2019t go there; go here instead!\u201d<\/i><\/p>\n<h2 id=\"content-list-title-5\">Switching to a competitor\u2019s brand<\/h2>\n<p>Another scheme that provokes dumping among competitors for the same product is advertising a low price to lure customers, then switching them to a product from another brand. Along with appearing in Google search results, such online stores draw in interested visitors by deliberately listing items they don\u2019t actually have on price aggregators (Hotline, etc.).<\/p>\n<p>The effect of this strategy for online stores is somewhat questionable because it requires skilled engagement with the end customer and the ability to switch them from one product to another. But for the \u201cdonor brand\u201d (the one being switched away from), it\u2019s both reputationally and financially damaging.<\/p>\n<p>Both newcomer stores and those cut off from supplies for contractual violations can engage in this practice. You might negotiate with some, but for others who <a href=\"https:\/\/pricecop.net\/en\/blog\/monitoring-cen-tm\/\">illegally use your trademark<\/a>, you should demand they remove the items from their web storefront.<\/p>\n<p>Systematic data collection directly from online stores, as well as monitoring prices on Hotline, allows you to stay informed about all major market players, including those using switching schemes for items they can actually sell.<\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>\u201cThe bullet\u2019s already left \u2014 it\u2019s your problem now&#8230;\u201d<\/i><\/p>\n<h2 id=\"content-list-title-6\">Uncoordinated price list updates<\/h2>\n<p>Not all online stores intentionally violate agreements with suppliers. Many suppliers simply fail to understand the nuances of online stores\u2019 business processes.<\/p>\n<p>While a single supplier can send one price list at a time to dozens or even hundreds of stores, a typical online store receives dozens of price lists per day from different suppliers, and each one needs processing!<\/p>\n<p>The result is that category managers in online stores can\u2019t keep up with updating all supplier price lists, leading to mistakes in product prices \u2014 some end up too high, some too low. Chaos ensues&#8230;<\/p>\n<p>Organizational and technical factors include:<\/p>\n<ul>\n<li>no regular delivery of updated price lists;<\/li>\n<li>price lists in inconvenient formats (in the body of an email, in PDFs, behind a site login\/password);<\/li>\n<li>no online price list (e.g., <a href=\"https:\/\/pricecop.net\/en\/blog\/online-google-price\/\/\">Google Sheets<\/a>);<\/li>\n<li>supplier\u2019s price list is tied to a foreign currency, and the recipient doesn\u2019t get timely updates on currency exchange rates.<\/li>\n<\/ul>\n<p>The better suppliers organize the distribution of their price lists, and the higher the automation level of updating price and inventory information, the fewer problems online stores face in processing this data.<\/p>\n<hr \/>\n<p style=\"text-align: right;\"><i>\u201cThe city goes to sleep, the mafia wakes up\u2026\u201d<\/i><\/p>\n<p style=\"text-align: right;\"><i>\u201c\u2026and starts dumping prices.\u201d<\/i><\/p>\n<h2 id=\"content-list-title-7\">Dumping after hours \u2014 evenings, nights, and weekends<\/h2>\n<p>Often, it\u2019s well-known when staff controlling online store prices are off duty. Precisely at these times, maximum dumping occurs automatically in online stores for certain brands. Yet, by the start of the next workday, the RRP is automatically reinstated.<\/p>\n<p>The quickest stores make sales this way, while the most honest ones see close to zero sales under these circumstances.<\/p>\n<p>How do you stay informed about what\u2019s really happening on the market at any time?<\/p>\n<p>You probably already know the answer \u2014 connect to an <a href=\"https:\/\/pricecop.net\/en\/\">automated monitoring system for online stores<\/a>. PriceCop\u2019s system collects prices, availability, and other data, helping you eliminate manual tasks and increase sales.<\/p>\n<div style=\"text-align: center;\"><strong>Find out what\u2019s happening in the Ukrainian market \ud83c\uddfa\ud83c\udde6 in 60 minutes,<\/strong><\/div>\n<div style=\"text-align: center;\"><strong>by launching DEMO price monitoring in online stores!<\/strong><\/div>\n<div style=\"text-align: center;\"><strong>The DEMO runs fully automatically 24\/7\/365. Try it now!<\/strong><\/div>\n<p><\/p>","protected":false},"excerpt":{"rendered":"<p>Sorry, this entry is only available in UA.<\/p>\n","protected":false},"author":1,"featured_media":1535,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1023","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/posts\/1023","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/comments?post=1023"}],"version-history":[{"count":3,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/posts\/1023\/revisions"}],"predecessor-version":[{"id":2159,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/posts\/1023\/revisions\/2159"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/media\/1535"}],"wp:attachment":[{"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/media?parent=1023"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/categories?post=1023"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/pricecop.net\/en\/wp-json\/wp\/v2\/tags?post=1023"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}