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Pricing Teardown: Baby & Child Industry – Huggle.co.uk

Learning from the experiences of a successful e-commerce business is a great way to help plan your own pricing strategy. That’s why we’re going to analyze a pricing teardown.

We’ll look at five different pricing strategies one particular e-commerce retailer uses to generate sales. Based upon their experience, we’ll talk about:

  • Why it’s important to offer up to date seasonal offers
  • How personalization helps increase sales potential
  • Why adopting a price match guarantee can be effective for boosting sales and beating your competitors
  • Importance of using a free delivery threshold to increase your average order value

Let’s go!

What store we’re looking at

In this pricing teardown, we’re looking at a UK retailer, Huggle. Huggle is a brand that sells products for babies and young children.

Because of their large number of product categories, they’re able to adopt a wide range of different strategies to boost sales.

Boost sales with seasonal offers

Seasonal offers are necessary for e-commerce businesses. Since all of your competitors benefit from seasonal offers missing out on them impairs your competitive strength.

What you need to keep in mind is that your customers have all the power. With the heightened number of stores across every industry growing year on year, customers are able to choose who they shop with.

Knowing that, Huggle creates seasonal promotions as a good way to keep customers coming back for more.

You’ll also notice that they have a threshold for when you’re able to achieve the 15% off. This threshold is crossed when a customer has spent over £400.

Now at first glance, you might be thinking: “Woah, £400 is a lot of money to spend before you get a discount”.

But it is actually in line with the prices on their store.

Before you to start using seasonal offers and discounts on your own store, make sure you’ve thought about the type of customer you want to attract and the type of discount they’d appreciate and value.

It makes no sense if you only offer budget products and set a discount threshold of $400, as it’s highly unlikely that a customer would spend that much.

Huggle Bed Prices

If you browse their store you’ll see that they cater towards the higher end of the market and offer their products at a premium price.

Huggle Stroller Prices

You can now see how easy it would actually be to spend £400, so having the 15% discount comes as a nice bonus.

Personalization increases repeat purchase rate

When it comes to a store like Huggle what they understand well is that a customer is usually only a customer for the time their child is a baby. When their child reaches age 6, they no longer need a pushchair or other baby products.

So the thought becomes, how do you keep people as paying customers, even when they stop needing the essential baby products?

Huggle does this through their personalized gifting section.

Huggle Gift Section

They have a range of different subcategories within their top-level gift category and it encourages people to buy products for others, even if they don’t have a baby themselves.

Now, if you were a previous customer of Huggle (when you had a baby), knowing that they offer gift ideas will entice you to come back.

If you also received good customer service during the time you were a customer, you’re going to think of Huggle as the first point of call when it comes to gifts.

You see, the thing about the gift section is that it increases the chance of life long customers. Use a gifting strategy within your e-commerce store, think carefully about your audience and select products that would be great as gifts.

You don’t want to make the error of putting all your products in the gifting section, you need to make it easy for people to discover and purchase the perfect gift for their friend or loved one.

Price match guarantee to beat competitors

If you have a great brand image and people love to shop with your regardless, having higher prices than your competitors won’t make a difference – your loyal fans will still shop with you.

But if you cater to customers who like to shop around to see if they can get the same product cheaper elsewhere, then you might benefit from using a price-match-guarantee scheme, as Huggle does.

Price Match Guarantee Scheme

Huggle understands that their competitors might find a way to offer the same product for a cheaper price.

So instead of letting that customer go, what Huggel does is offers to price match. If you find an identical product for cheaper elsewhere, you can buy it from Huggle for the same price.

This strategy is effective because it keeps customers coming back for more.

Yes, they’re still able to shop around to find the lowest price, but in this instance, they do so because they know they can get the product from Huggle for the same price.

Free delivery threshold

You’re familiar with filling your basket with items you like, only to find out in the checkout page that the shipping costs are extortionate.

One of the top three reasons why shoppers abandon their carts is the extra costs. Offering free shipping decreases the chance of people abandoning their shopping carts.

Free Shipping

Huggle uses a free shipping strategy on all orders over £60.

We’ve already mentioned that Huggle caters towards a premium audience – where customers are happy to pay higher prices for their products.

Considering their audience, their free shipping threshold actually seems quite low. Even at the lower end of their products, you only have to buy a few to qualify for free shipping.

Offer free shipping on your own store, but be sure to factor this into your e-commerce expenses.

Free shipping for your customers means another cost to cover for you. If you can’t afford to pay for it yourself, you could do it by raising your prices slightly.

Bonus tip: User-generated content

You know that reviews are a great way to generate sales.

People trust their peers more than they trust you. If you were to see your friend waxing lyrical about a recent purchase, it’s likely that you too would check this out.

Huggle Social Media

Within your own e-commerce store, you can do this too through user-generated content.

User-generated content is where you take the content your customers have created and use it within your own marketing arsenal.

It shows that other people have bought your products and like them enough to talk about them with their own networks. Huggle does this on their Instagram.

It’s great for the customer as they include a link back to their own Instagram page and it’s great for Huggle as they get to show the world people who are enjoying their products.

Final thoughts

We can always learn from others’ experiences. Huggle constitutes a great example we can draw lessons from. We’ve analyzed the successful strategies the company pursued and explained how you can integrate them into your own store.

We know that what works for them may not work for you. But there is no point in playing safe. Don’t hesitate to try new tactics and see if they improve your business.

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