Price Optimization: Consumer Packaged Goods Company
Our client, a global food manufacturer had more than 5000 individual SKUs that were sold through their direct and distributor network to major retailers across the US. They had very little insight into what pricing tactics were effective when creating trade deals. They evaluated various optimization oriented solutions, but felt they were not the right fit for their organization due to their complexity and practicality in their sales and customer environment.
The client asked CoreCompete to provide a capability that will allow them to systematically understand the key price points that need to be considered when creating trade deals. This was intended to be achieved through automated generation of insights that allowed the users to see the impact of price on case-volume. These key price points needed to be understood for base prices, promotional prices and key competitive price gaps.
CoreCompete developed a system that takes weekly sales data and generates price point curves and identifies a meaningful relationship between price and volume, highlighting key price points. The account teams, sales and brand management can utilize this information in decisions such as: price list updates, trade deal creation and competitive price gap analysis.