Product Line Gaps
A leading European alcoholic beverage manufacturer was challenged to optimize prices between distinct product quality categories. Optimizing the prices for an extensive product line is complex. Pricing Solutions developed a sophisticated forecasting model that analyzed the movement of product volume as prices were changed among the various brands, levels of quality, and package sizes. By understanding the financial implications of product-line cannibalization when varying the price gaps between the discount and premium categories, the client was able to determine the optimal pricing and promotional strategy, delivering millions of dollars in bottom-line profit.