SYMSON helps you to optimize pricing and demand forecasting with machine learning

SYMSON Pricing helps to optimize your pricing with the help of smart algorithms. The tool gives you advice on how you can improve your margin per product or per customer. The big advantage is that you can implement different pricing strategies per product so well suited if you want to experiment with different prices or if you want to automate predefined strategies.

SYMSON AI Data-driven Software

Form has been submitted

We automate and support pricing optimization and demand forecasting processes. Our platform enables you to understand AI decisions and thereby improve your gross margin.

  • Automate labour-intensive routine tasks for huge time savings.
  • Valuable insights into customer behavior such as price sensitivity and seasonality.
Trusted by these data driven companies

Price elasticity of Demand

What is price elasticity?

The price elasticity of demand indicates to what extent the demand for a certain product changes when the price of that product changes. Let’s imagine that you increase the price of your product with 20%, how much would the demand change then?

Almost always there is a negative relationship. If a product becomes more expensive, this will almost always result in less demand. But the change in demand is not the same for every product. When the prices of food increase, most of the time little happens. Basic foodsources are considered to be primairy products. Or you can also call them essential products. These types of products are considered to be priceinelastic.

However, if petrol prices rise, demand for it may drop. When petrol prices surge for a longer period of time, alternatives become more attractive. People may decide to buy an electric vehicle or even switch to public transport instead. Here you could argue that this product is priceelastic.

With SYMSON, you can analyse this quickly for each of your products, in an easy to understand interface. With the knowledge you obtain you can respond quickly with price changes. To leave no profit margin on the table.

Price elasticity

How do you calculate the price elasticity of your product?

You can easily calculate the price elasticity of your product with the following formula:

Percentual change in demand / Percentual change in price = Price elasticity (Ev)

From this formula you get a number which indicates the price elastiticy of your product. From these numbers you can conclude the following:

  • Ev = 0 | When the price elastiticy is equal to zero you know that your prodcut that the demand is insensitive to price changes. This means that the demand will not change at all if the prices rise. This could theoretical happen for products that people always need or for products that are very in demand and exclusive.
  • -1 < Ev < 0 | When the price elasticity is between -1 and 0, there is a relatively inelastic price elastiticy. This means that if you raise the price of your product, the demand will drop slightly. There is thus still room to improve your profit margin and maximizing your profit.
  • Ev < -1 | If the price elasticity has a value that is smaller than -1 then there is a heavy negative correlation. If you increase the prices of these kind of products then you will lose a lot of customers. In these cases it may be better to decrease your prices.

Conclusion

If you want to have the optimal prices for your products you need to know the price elasticity for that product. With this information you can determine what you should do. Maybe you should increase it to optimize profit. Or maybe you should decrease it to sell more and increase revenues.

For many companies it is a huge challenge to make this visible for products. SYMSON helps companies with making your pricing and demand forecasting manageable. We also give advice on how you can optimize your prices with the help of AI.

Do you want to know more? Read then our article on which 6 factors are influencing price elasticity.

[cta_testimonials]

Download one of our white papers

Stay informed of the latest developments in the demand forecasting and demand planning market and download our white papers. Our white papers provide a diligent overview full of strategies and insights to optimize your pricing and demand forecasting

How do I choose the right pricing solution?

What you can learn in this whitepaper

  • Three different solutions to improve your pricing

  • 8 key features that make your pricing software scale

Form has been submitted

The AI platform for customer insights

We automate and support pricing and demand forecasting processes. Our features enable you to understand the AI- decisions and increase your yield.

Enlarge Image

Why SYMSON?

A summary of reasons and benefits

  • Automate labour-intensive routine tasks for enormous time savings.

  • Be fully in control of the dynamic customer demand.

  • Valuable insights into customer behaviour such as price sensitivity and seasonality.

  • Introduce machine-learning to your pricing and demand forecasting.