"Failing to use the proven science behind price optimization technologies has become a true inhibitor for retailers," observed the RSR researchers in the conclusion to their recent pricing survey, the Pricing Paradox. And, although the stated position of RSR Research is "to focus on the business challenges and opportunities that technologies can address rather than on the technologies themselves," RSR went on to admonish retailers that:
A). Measuring is imperative. Measurement should be a priority, even if it isn't clean or easy. If you can't measure, how can you correct for the last cycle's mistakes? How do you know if you executed the way you needed?
B). Lifecycle shouldn't be ignored. Products and their value have a lifecycle, stretching from introduction to the market through end-of-cycle and ultimate elimination. The survey discovered that a shocking 56% of retail laggards and 28% of retail winners have no plans to address end-to-end price lifecycle management.*
Top retail intelligence solution providers offer and integrate a range and depth of solutions. Here are the parts that price and assortment optimization solutions play in helping retailers remain competitive:
A. Pricing Intelligence solution:
1. Have accurate, detailed, reliable information.
2. Track, compare and analyze competitive insights.
3. Obtain recommendations for optimizing pricing.
4. Obtain recommendations for optimizing pricing based on real-time competitive information.
5.Develop the best possible competitive & dynamic pricing strategy.
6. Translate the strategy into action.
7. Monitor execution and results.
B. Assortment Intelligence solution.
With complete visibility into what products are being offered in the market, retailers are in a great position to make very specific, wise, and profitable assortment decisions.
8. Find opportunities to continuously enhance assortment.
9. Find opportunities to continuously optimize product mix.
10. Select products objectively and more efficiently (even when your catalog includes thousands of items).
11. Track the business impact of those product actions.
C. Lifecycle Intelligence solution:
Lifecycle intelligence allows retailers to conduct competitive pricing research and use competitive historical information as a benchmark to assess the effectiveness of their pricing and practices and to set concrete targets for greater success.
12. Leverage historical competitive information to uncover important trends that may affect the way you manage your product lifecycle.
13. Leverage historical competitive information to uncover important trends that may govern the way you manage your product lifecycle.
D. Dynamic Pricing solution.
14. Base their pricing practices on internal drivers.
15. Base their pricing practices and actions on competitors’ moves.
E. Business Scenario Manager:
Retailers have unique pricing and assortment management practices created over time to address business needs while complying with organizational constraints.
16. Model scenarios give an idea in ADVANCE, of the ramifications of your actions, and also help eliminate barriers for adoption and acceleration of the use of retail intelligence in the company.
F. MAP Monitoring:
Competitors violating MAP (Minimum Advertised Prices) dramatically affect a retailer's sales volume and bottom line. Map monitoring helps retailers:
17. Make sure your competition is following the MAP strictures like you are.
18. Assure you have a fair opportunity to compete.
19. Have documented proof with which to approach manufacturers / suppliers to keep your competition in line, and, as appropriate, negotiate better pricing.
20. Helps manufacturers and suppliers protect their brand image.
Bottom Line For Your Bottom Line:
The retail market has become hyper-competitive, with product assortment expanding dramatically, and with adjustments occurring on a real-time basis. As a result, traditional pricing and demand prediction practices often come up short.
In order to compete, survive and thrive in today's marketplace, retailers need to use the most complete, configurable, scalable and insight-rich solutions on the market.
With these tools, executives and professionals in pricing, merchandising, buying, and financial roles can feel confident that important functions are maximized by fact-based, real-time competitive insights.