Video
Price Elasticity: How Can You Use It for Profit Increase
Accurately measuring price elasticity in retail is key to any pricing optimization effort. Managers and online retailers need to understand the microeconomics of how customers respond to a price change in order to realize the full potential of pricing and price elasticity.
In a 15 minute video you will gain insights on:
- Understand Customer Behavior: Identify critical products for your customers and enhance your price image. Discover items prone to price comparisons.
- Optimize Pricing Strategies: Calculate profit scenarios for different price points. Develop demand-driven pricing strategies based on data and demand curves.
- Accelerate Profit Growth: Fine-tune pricing strategies to maximize revenue without sacrificing market share. Unleash your business's profit potential.
To calculate price elasticities effectively, modern retailers employ machine learning algorithms. This approach is regarded as the most effective because it harnesses a wealth of data to extract valuable insights about price elasticity. Traditional pricing methods typically account for only a limited number of factors, usually around three to five. However, software utilizing advanced neural networks from the latest generation can incorporate all pertinent factors when assessing price elasticities. This results in superior outcomes compared to simpler rule-based pricing strategies, allowing for more nuanced and precise pricing decisions.
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