Price and Promotion Optimization
Retail Express price optimization delivers profits today and is fully integrated with our everyday price and promotion management modules, resolving conflicts and constraints within a single strategic pricing solution. The price optimization module enables you to maximize the overall profit, margin or contribution of a portfolio of products. Unlike other revenue optimization products we can optimize regular and promotional prices, separately or concurrently and on demand, taking the effects of each other into account.
The solution supports Hi-Low, EDLP, Value or a mix of those strategies through line item, brand, supplier, competitor and category rules and differentials mixed with performance targets. The solution supports the creation of differentials between the retailer’s individual product prices and those of its key competitors to ensure effective price positioning in the market place and to deliver a clear pricing strategy; the solution also provides differentials between the sizes of individual products (100g/200g/300g) and between individual brands.
The retailer drives the optimization technology through setting goals and objectives in terms of sales, profits and unit volumes with the opportunity to limit those elements with constraints against each of the others, such that if the goal is the increase in profits, a sales and or volume constraint could be put in place to ensure the profit increase was constrained by a minimum level of sales and volume, thus ensuring balance is kept across the product portfolio.
The creation of rules for competitor brands and size can be in conflict and this can be further complicated by imposing performance goals and objectives, however the Retail Express solution has conflict rules management software which allows the application to resolve conflicts on a prioritised basis in a sequence pre approved by the user.
The Optimization process produces prices out over a number of future weeks, often the length of the known promotion program and provides a summary forecast of the whole optimization period in terms of sales profits and volumes shown against a forecast of what would happen in a non optimized environment. In addition a weekly breakdown is provided showing individual price changes up and down resulting from the optimization and shown against competitor prices.
Retail Express provides both a SaaS and behind the firewall capability for optimization and the solution is fully real time, thus on demand optimizations can be a standard part of the pricing lifecycle management process.