CASE STUDY

Pricing Analytics Helps a Beverage Manufacturer to Identify New Price Improvement Opportunities

Aug 14, 2017

Over the years, the consumption of beverages has sneaked through conventional beliefs and has become a part of the daily course with a considerable number of people consuming it as an aperitif. The changing preferences of consumers have brought in a new dimension to the beverages industry with drinks being served across a majority of the restaurants. With the beverage market nearing its saturation, manufacturers have started relying on pricing analytics solutions to improve profitability and market share by augmenting prices and pricing strategies. Also, leading brewers are leveraging the use of analytics solutions to understand customers’ buying decisions and integrating the knowledge to meet the pricing needs of their consumers. In the beverages landscape, pricing analytics can help organizations to understand both the internal and external factors affecting profitability at the granular level.

To gain actionable insights, the client approached Quantzig’s pricing analytics experts. Quantzig’s pricing solution helps the client gain insights on the type of customers to focus, the products to rationalize, and how to effectively leverage the use of automation tools to make informed business decisions. The solution also helped the client gauge the potential impact of pricing change on demand and profitability.

Quantzig’s offers a portfolio of highly customized yet scalable and cost-efficient pricing analytics solutions. Get in touch with an analytics expert to learn more.

The Business Challenge

A major global beverage manufacturer with multiple breweries and thousands of employees has a vision to stay ahead of its competitors in the fiercely competitive market. In the multi-brand and multi-SKU environment, product differentiation was low. The client was facing pricing challenges in accurately evaluating the impact of pricing and promotion decisions. Like many many other manufacturers, the client had difficulties identifying the factors that were driving sales. In addition, the client needed the assistance of custom-built pricing tool to develop advanced pricing management capabilities for long-term success.

Our Approach

To gain more insights into the pricing analytics solutions, Quantzig’s team of pricing analytics leveraged the use of a choice-modeling tool to assess the effect of pricing and promotion decisions across multiple products. Also, the tool was capable of evaluating pricing actions down to the SKU-level. The robust model helped the client forecast volume and margin for the price, product, and brand combinations of interest. The team also developed an overarching strategic pricing framework to assess the impact of seasonality, advertising, customer preferences, and shelf location to generate consistent accurate results.

To learn more about how our pricing analytics solutions can help you tackle your pricing challenges, request for more information.

pricing analytics

Pricing Analytics Solution Benefits

  • Uncover both short-and long-term pricing improvement opportunities
  • Positively change store trajectory and stabilize sales and margin
  • Forecast demand for different pricing and promotion strategies
  • Regulate inventory levels and improve customer satisfaction
  • Design a robust price optimization model to recommend prices, thereby improving profits

Pricing Analytics Solution Predictive Insights

  • Assess the difference between their products and competitor products
  • Determine optimal price gaps with respect to competitor products
  • Generate desired sales volume by compromising on the trade budget
  • Identify the impact that discounted prices have on the sales to the end customer

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