The document discusses using data and analytics to optimize pricing decisions. It describes estimating price elasticity to identify sensitive products and locations, forecasting demand and revenue based on price changes, and optimizing prices across stores and items to maximize profits. The goal is to democratize pricing by providing easy-to-use tools for business users, store managers, and marketers.

3. Souce: https://en.wikipedia.org/wiki/Big_Mac_Index#/media/File:Big_Mac_index_50USD_2columns.png
Use under CC BY-SA license: https://en.wikipedia.org/wiki/Wikipedia:Text_of_Creative_Commons_Attribution-ShareAlike_3.0_Unported_License

7. PEOPLExpress Picture: Source: https://commons.wikimedia.org/wiki/File:People_Express_Boeing_747_at_London_Gatwick_in_June_1983.jpg
American Airlines Picture: Source: https://commons.wikimedia.org/wiki/File:American_Airlines.Airline_meal.CDG-JFK.2010.JPG
Use under Creative Commons Attribution-Share Alike 3.0 Unported: https://en.wikipedia.org/wiki/Creative_Commons, https://creativecommons.org/licenses/by-sa/3.0/deed.en

12. Data is the primary source

13. Data is the primary source
Validated at each stage of the process

14. Data is the primary source
Validated at each stage of the process
Democratize pricing decisions

15. Data is the primary source
Validated at each stage of the process
Democratize pricing decisions
Better granularity. Easy to scale

16. Data is the primary source
Validated at each stage of the process
Democratize pricing decisions
Better granularity. Easy to scale
Facilitates “value-based pricing”

19. Price
Elasticity
Forecast
Optimiza
tion

20. Price
Elasticity
Forecast
Optimiza
tion

21. Definition
Price
Elasticity
Forecast
Optimiza
tion

23. 9
8
2 4
A
B
10
200

24. 9
8
2 4
A
B
10
200

25. 9
8
2 4
A
B
10
200

26. A
B
10
200
-5.67
9
8
2 4

27. A
B
10
200
-5.67
C
D
E
F
9
8
2 4

28. A
B
10
200
-5.67
C
D
E
F
9
8
2 4
5.5
4.5
9 11

29. A
B
10
200
C
D
E
F
9
8
2 4
5.5
4.5
9 11
-1
-5.67

30. A
B
10
200
C
D
E
F
9
8
2 4
5.5
4.5
9 11
-1
-5.67
16 18
1
2
16 18
1
2

31. A
B
10
200
C
D
E
F
9
8
2 4
5.5
4.5
9 11
-1
-5.67
-0.18
16 18
1
2

32. A
B
10
200
C
D
E
F
9
8
2 4
5.5
4.5
9 11 16 18
1
2
Price Elasticity < -1: ELASTIC
-1
-5.67
-0.18
Price Elasticity > -1: INELASTIC

33. A
B
10
200
(2 – 4)
(9 - 8)
C
D
E
F
9
8
2 4
5.5
4.5
9 11
(9 – 11)
(5.5 – 4.5)
-1
-5.67
(16 –18)/
(2 - 1)
-0.18
16 18
1
2

34. 10
200
C
9
8
2 4
5.5
4.5
9 11
-1
B
D
-0.18E
F
16 18
1
2
Price Elasticity <= -1: ELASTIC
A -5.67

35. Estimate Price Elasticity in Business
Price
Elasticity
Forecast
Optimiza
tion

36. Chowder Sales Chowder Price
102 6.24
59 7.19
49 7.42
59 7.56
76 6.9
80 7.5
69 6.7
113 5.54
59 7.42
66 7.19

37. A
B
10
200
9
8
2 4
5.5
4.5
9 11 16 18
1
2
Chowder Sales Chowder Price
102 6.24
59 7.19
49 7.42
59 7.56
76 6.9
80 7.5
69 6.7
113 5.54
59 7.42
66 7.19

38. A
B
10
200
9
8
2 4
5.5
4.5
9 11 16 18
1
2
Chowder Sales Chowder Price
102 6.24
59 7.19
49 7.42
59 7.56
76 6.9
80 7.5
69 6.7
113 5.54
59 7.42
66 7.19

39. Chowder Sales Chowder Price
102 6.24
59 7.19
49 7.42
59 7.56
76 6.9
80 7.5
69 6.7
113 5.54
59 7.33
66 7.58
[Next]

52. [Next]

56. Estimate Price Elasticity in Business
Identify sensitive stores and items
Price
Elasticity
Forecast
Optimiza
tion

57. [Next]

72. Souce: https://en.wikipedia.org/wiki/Big_Mac_Index#/media/File:Big_Mac_index_50USD_2columns.png
Use under CC BY-SA license: https://en.wikipedia.org/wiki/Wikipedia:Text_of_Creative_Commons_Attribution-ShareAlike_3.0_Unported_License

73. Estimate Price Elasticity in Business
Identify sensitive stores and items
Forecast Demand and Revenue
Price
Elasticity
Forecast
Optimiza
tion

75. [Next]

79. Estimate Price Elasticity in Business
Identify sensitive stores and items
Forecast Demand and Revenue
Optimize Prices
Price
Elasticity
Forecast
Optimiza
tion

81. 15.5 Y Y Y
15 Y Y Y Y
14.5 Y Y Y Y
14 Y Y Y
Store 1 2 14 14.5 15 15.5

84. Price
Elasticity
Forecast
Optimiza
tion

87. VM
Business User
Store Manager
Business User
Marketing

88. Price
Elasticity
Forecast
Optimiza
tion

89. Price
Elasticity
Forecast
Optimiza
tion

90. Price
Elasticity
Forecast
Optimiz
ation

91. Price
Elasticity
Forecast
Optimiz
ation