Even today, many companies find themselves in difficulty when it comes to take pricing decisions based on the available data. To simplify the situation, we could define two macro-categories into which 90% of companies can fall: the first is where there are so much and so complex data available that finding a key to interpret it becomes difficult; in the second, there is so little data available that integrating it is not so trivial.
Pricing software, the benefits of data analysis
Regardless of the pricing system used and the amount of data available, to get the most out of the available data and optimise the expected output, using an AI-based technology is often the best solution.
By effectively analysing the dataset, it is possible to extrapolate certain insights such as identifying areas where the pricing strategy needs to be improved and those that can generate new profit opportunities. A useful tool for doing this is pricing software, which uses the evidence from the data to guide internal company decisions and supplement the available knowledge with additional information to optimise the pricing applied and achieve the set business goals.
Pricing software, the advantages
The three main advantages of using pricing analysis software are:
Unification of datasets
The main advantage of using pricing analysis software is that it can become the sole source of data to be used daily for various types of analysis. Furthermore, price analysis software can provide valuable information on the products or services on sale. For example, it can make it possible to identify clusters of products in which the same price ranges can be applied based on similar characteristics, or it is possible to identify customer segments with similar purchasing behaviour to which the same marketing campaigns can be directed. Furthermore, automation makes it possible to replicate and modify analyses to speed up numerous internal processes.
Pricing analysis software provides useful pricing calculations based on analyses defined by pricing experts to maximise business objectives. By using such analysis tools, you can detect losses without having to wait for the usual monthly or quarterly timeframes and correct your strategy quickly to increase your overall profits.
Planning for price changes
Companies with a pricing strategy already in place typically need to closely monitor the market and anticipate the impact of a price change or promotional campaign. These companies usually need predictive models provided by pricing analysis software, which examine the present and plan price changes with great precision.
Pricing software, typical companies
That said, the companies most likely to use pricing software will be those that are looking to improve their profitability or margins or need to maintain or gain market share, or those looking to improve operational efficiency. So, potentially most companies in the market except, for example, those that have such objectives but are small in size. This is related to the fact that lacking an IT department or a pricing team, pricing software can be too complex a tool to implement and administer, which risks not bringing the expected results.
In general, when you have the available resources to devote to pricing, the support of a pricing software is crucial, and is the key element that can make a difference in the market and facilitate the work of management.