Inputs
Optimization Engine
Forecasting & Outputs
Facts
Strategic & Category Input
Quantifiable Insights
Economic Forecasting
Management Outputs
Customer & Business Optimization
Micro Economic Optimization
1.1: Facts
The elements of reality that are needed to make effective pricing decisions, e.g. competitor price and promotions for each product
1.2: Strategic & category Inputs
1.3: Quantifiable insights
Input from the business & categories on the overall strategic direction
Measured and estimated insights required to make effective trade-offs, e.g. category level elasticities, product switching
3.2: Management outputs
3.1: Economic forecasting
Produces a prediction of the overall product and store level performance given the defined prices
A clear set of outputs that allow the manager to see how the trade-offs have been made, particularly the key trade-off between economic returns and the business / customer strategy
2.1: Customer & business optimisation
– Economics – Competitor positioning – Architecture
Small tweaks to each product’s price to get to an optimum after switching
2.2: Micro economic optimisation
Setting an optimal price for each product based on:
