90% of pricing decisions still depends on intuition and spreadsheets. Most of the time, companies rely on repetitive tasks in Microsoft Excel or on guesswork for their pricing. According to McKinsey, a 1% price increase can lead to an 8% increase in margin. Choosing the right price for your products is thus vital for pricing managers and the success of the company.  There are a lot of pricing tools on the market. So many that you may be overwhelmed by all the different tools and different functionalities.

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Competitive landscape

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Definitions

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• Dynamic Pricing – Dynamic pricing is the constant automatic adjustment of prices of shops as a reaction to events that happen. For example, when the price of your competitor changes, your price automatically changes as well. A dynamic pricing strategy could react to many different events such as: competitor prices, supplier prices, seasonality, geography or something else.

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• Competitive pricing – A pricing method whereby your prices are set in relation to your competitors’ prices.

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• Cost Based Plus Pricing – A pricing method whereby your prices are determined by calculating the cost of the product and then offering that price plus a certain profit margin.

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• Key Value Item Pricing – A pricing method whereby key value items (KVIs) are determined and sharply priced to attract customers to your shop. The margin is then optimized by increasing the price of items that are not classified as KVIs. Read here more about how this strategy can lead to extra margin.

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• Price Elasticity Pricing – A multiplier that indicates the extent to which the demand for a certain product responds to a change in the price of that product.

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• Machine Learning Pricing – Some pricing tools have built-in machine learning protocols which can identify the best pricing and demand forecasting solutions. One of these tools is SYMSON.

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• Pricing Management Suite – A full pricing suite is a central place in your pricing tool in which all pricing information and strategies are integrated. Here, prices are constantly developed, determined and executed for your customers with a few mouse clicks. This feature enables you to manage your pricing better and to improve your margin and profitability significantly by having “what if scenario’s”.

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• Augmented Intelligence – Augmented Intelligence is the use of Artificial Intelligence to help human decision making. An example of this is a machine learning model that helps you with choosing the right pricing for your products.

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• Apply your own business rules – We offer you the possibility to apply business rules (constraints) to your automated dynamic pricing. In this way it’s possible to take into account your market circumstances and business goals in price optimization.

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• Margin Improvement Advice – We offer customized advice on improving your margin (for specific products). For example, by lowering the price of product X with 5%, a client of SYMSON was able to increase the quantity sold per month with 99%, resulting in an increased gross margin per month of 72%.

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• Implementation – It takes about two weeks to install the software. This takes longer than competitive pricing software, because internal data streams should be connected to SYMSON and multiple strategies must be combined. And it is many times faster than enterprise software tools, because of our building block configurator.

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• Focus – There are many pricing solutions for many types of businesses. We focus mainly on the medium sized business, but we also want to make SYMSON available for smaller companies.

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• Pricing – Prices and pricing plans most often vary for each individual business. However, they can be classified as either low, medium or high in relation to each other. SYMSON wants to offer the market an affordable solution for pricing optimization.

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Conclusion

Choosing the right pricing solution for your business remains a lot of work and most often, the decision is not made in one day. To see what SYMSON could do for your business you can schedule a call and discuss the possibilities or read one of the case studies.  

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