For retail and e-tail businesses, there are significant benefits to working with pricing analytics experts who have high-level pricing analytical skills and can use a company’s data to inform pricing and create new pricing opportunities, especially in the areas of e-commerce and competitive intelligence. In this article, the author presents best practices for applying pricing analytics tactics to large, dynamic retail businesses which can be used by pricers operating in these markets.
Using the standard volume hurdle equation allows a pricing professional to calculate the volume hurdle required for both price increases and price decreases. However, this volume hurdle analysis only considers pure price changes, where nothing changes but the price. It does not take cost changes into account. In this article, the author explains how to expand this equation to account for changing costs, which is a critical consideration for pricers in the current economic environment.
Management deserves clarity from their revenue variance analysis, especially if the variance analysis is used in making compensation, budgetary, and personnel decisions. In this article, the author provides examples of best practices in performing and delivering these analyses.
Many retailers underestimate the value of coordinating decisions on pricing and promotions. A new pricing analytics approach can help.
Pricing professionals are most often hired to accomplish a singular goal: improve profits. But how do measure the impact of pricing initiatives on profitability? In this article, the author provides an explanation of how a profit bridge with proper attribution can be used to both guide pricing efforts and measure pricing performance.
Many companies are adding some form of predictive analytics to their offers. This is true across all sorts of businesses that collect a lot of data in the normal course of operations. At the same time, the rapid advances in machine learning since 2007 have made it much easier to develop predictive learning applications, and many companies are rushing to take advantage. But how do you package and price this new functionality?
Back in 1597 Sir Francis Bacon opined that knowledge itself is power. And with the correct data, analytics, and a framework of key processes, it’s possible to leverage the knowledge of what a market competitive price should be to avoid overspending, as the author explains.
Method to Determine the Income Forecast for the Sustainability of the Profit Margin, the IFSPM Method
In this article, the author presents a methodology for accurately projecting sales budgets. Specifically, the methodology presents a series of five equations that can be used to determine the income forecast necessary for the sustainability of current profit margins, which the author calls the IFSPM Method. Examples are provided to demonstrate the methodology’s applicability in both project and service-driven businesses.
While there are other research techniques that seek to understand the perceived value of products or services, the Conjoint Analysis method indirectly addresses the customer and therefore bypasses biases from direct research methods that make it harder to correctly model consumer choice behavior. In this article, the authors examine the benefits of Conjoint Analysis in developing pricing strategies, present several methods for applying this approach and review case studies of successful pricing projects.
Executive dashboards are valuable tools for coordinating across disciplines as well as for communicating critical business metrics to executives. Since pricing impacts these key business metrics, which elements should the pricing team include in their pricing dashboards? In this article, the author provides a list of items to consider when building a pricing dashboard.