Tech Solution: Price Optimization Tools
In these turbulent economic times, with consumers increasingly wary of spending on products and services, price is becoming a critical factor in a consumer's purchasing decision. Many companies must keep prices low to be competitive -- but how low is too low? When should prices change -- in either direction? Scoping out your competitor's prices across town just won't cut it. Instead, price optimization tools can help businesses take the guesswork out of pricing while simultaneously boosting bottom-line numbers.
DemandTec Strategic Pricing for Retail
Delivery Model: Software-as-a-service (SaaS)
Price: The price varies depending on size of the retailer and scope, starting at $300,000
Business Benefits: DemandTec customers can leverage powerful consumer, demand, and market insights to optimize prices for every item in the store to achieve volume, sales, profitability, and price-image goals. (The price image is the consumer perception of a product produced by its cost.) By using the solution, companies can realize an increase in profit while boosting sales, increasing unit volume, and improving price image.
Functionality: The DemandTec Strategic Pricing for Retail integrated solution includes DemandTec Price, DemandTec Promotion, DemandTec Markdown, and strategic pricing analytics such as Price Response Analysis, Image Item Analysis, Cannibalization Analysis, Category and Item Role Analysis, and Zone Analysis. These allow users to delve into price optimization, forecasting, advanced price maintenance, scheduling and execution, category plan management, scenario management, and other features.
Contact: DemandTec at 1-650-226-4600; or visit www.demandtec.com.
PROS Pricing Solutions Suite (Price Analytics, Execution, and Optimization)
Delivery Model: Installed software
Price: License and implementation fees range from $100,000 to $10 million based on the number of geographies, divisions, and other factors.
Business Benefits: Enabling users to stop destructive "cost plus" and "match the competition" pricing (which can create unnecessary discounting, price erosion, and below-breakeven price quotes by sales organizations), PROS improves operational profits by stopping price-based profit leaks and by finding negative-pocket-margin customers, products, and deals. (Pocket margin refers to net profitability.)
Functionality: The real-time dynamic pricing software optimizes millions of subsecond transactions daily with hundreds of simultaneous users. Executives, sales and marketing personnel, pricing managers, and finance personnel can use this solution to support pricing decisions through the aggregation and analysis of extensive enterprise application data, transactional data, and market information.
Contact: PROS at 1-713-335-5151; or visit www.prospricing.com.
Zilliant Precision Pricing Suite (ZPPS)
Delivery Model: On-premise deployment
Price: For companies with revenues of $500 million and above; starting price can top $1 million.
Business Benefits: Zilliant's pricing technology sets accurate pricing "guardrails" for salespeople by utilizing data and math techniques to calculate the custom target price, as well as a floor-to-ceiling range for each specific transaction situation. The solution also enables salespeople to make better pricing decisions by providing data-driven insight on their customers and deals. This guidance helps salespeople negotiate with confidence and consistency, maximizing profits.
Functionality: ZPPS Optimization provides price recommendations based on each deal's circumstances. ZPPS Deal Manager, a decision-support tool, streamlines the review-and-approval process of spot quotes and agreements by benchmarking against similar deals and profitability targets. ZPPS Analytics, a pricing and profitability business intelligence application, supports ad-hoc analysis and routine performance monitoring using management dashboards, sales scorecards, and a power-analyst workbench.
Contact: Zilliant at 1-877-893-1085; or visit www.zilliant.com.
Contact Editorial Assistant Christopher Musico at cmusico@destinationCRM.com.