Your Enterprise May be Suffering from Inadequate Price Optimization Models


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price_optimization_modelPrice Optimization Models

Price Optimization Models are mathematical programs that calculate how demand varies at different price levels then combine that data with information on costs and inventory levels to recommend prices that will improve profits. The modeling allows companies to use pricing as a powerful profit lever, which often is underdeveloped.

Price Optimization Models can be used to tailor pricing for customer segments by simulating how targeted customers will respond to price changes with data-driven scenarios.

Given the complexity of pricing thousands of items in highly dynamic market conditions, modeling results and insights helps to forecast demand, develop pricing and promotion strategies, control inventory levels and improve customer satisfaction.

Let's see if Price Optimization Models will offer the best solution to your current need.


Price Optimization Models help businesses determine initial pricing, promotional pricing and markdown (or discount) pricing. Initial price optimization works well for companies with a stable base of long life-cycle products—grocery stores, drug chains, office-supply stores and commodities manufacturers. Does your organization fall into any of these categories?

Do you want to set temporary prices to spur sales of items with long life cycles - newly introduced products, products bundled together in special promotions and loss leaders?

Does your business sell short lifecycle products subject to fashion trends and seasonality - airlines, hotels, specialty retailers and mass merchants?

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