💡 How is the general average against rivals calculated?

The price gap indicator is located at the top of your Product List view:

The average price gap indicator allows you to measure your overall price positioning against the competition. Here is how it is calculated and how to read it easily.

In short: what does this metric measure?

This metric calculates the average price gap between your products and each tracked competitor.

• For a retailer:

  • A positive (+) result indicates that you are on average more expensive than your competitors.

  • A negative (-) result indicates that you are cheaper.
     

• For a brand: The logic is inverted: a positive number indicates that your retailers are selling higher than your target price.

How is it calculated?

The system does not only compare your price to the lowest market price, it takes into account all product/competitor pairs.

1. Product-by-product comparison: For each active product, the system calculates the percentage gap with every competitor selling that same item.

2. Filtering outliers: Extreme gaps (below -80% or above +500%) are automatically excluded so they don't skew the overall average.

3. Overall average: The system sums all valid gaps and divides the total by the overall number of comparisons.

Please note: The weighting depends on the number of comparisons. A product available across 8 competitors will have 8 times more weight in the overall average than a product sold by a single competitor.

Concrete example

If you track multiple competitors, the summary row of your table applies the weighted average for each player:

Specifically, with the following example: 

The calculation for the price gap indicator will be as follows: 

 [(-2.3 × 396) + (0.3 × 215) + (8.1 × 647)] / 1258 = +0.9%