Improving your bottom line in e-commerce: How Beerwulf boosts margins & revenue with AI-driven price optimization
Finding that optimal price point for each product in your catalog across markets is a daunting task. With the help of AI & data-driven insights, Beerwulf was able to bring scattered data together and create a unified view on pricing. Here is how.
Client Introduction
Hans, CEO at Beerwulf
- Industry: Craft Beer E-commerce Platform
- Role: Chief Executive Officer
- Company Size: €36M in revenue; a Heineken subsidiary
Beerwulf is an online retailer in the craft beer industry and operates as a subsidiary of Heineken. The company specializes in offering a diverse range of craft beers through its e-commerce platform, including curated selections from various regions and brewers. Beerwulf’s business model focuses on delivering these specialty beers directly to consumers, providing access to unique and lesser-known brews alongside popular favorites.
Discovering the Optimal Price Point for Any Product in E-Commerce
E-commerce players have more opportunities to find the optimal price point for a given product in different markets. Beerwulf was looking to improve its price management, overcoming the challenges of scattered data sources and manual pricing adjustments. Pulling information together from sources like Excel, dashboards, and systems complicated the Pricing Team's decision-making for market-specific product pricing. It needed a unified view of pricing data that would enhance decision-making across multiple markets.
Focus on Data Management & Automation
The team at Crunch was chosen to implement an AI-driven solution to optimize Beerwulf's pricing. Recognizing the complexities of Beerwulf’s pricing challenges, we developed a customized pricing tool that streamlined data management and automated key processes.
Solution Outline
The introduced pricing toolset centralized all pricing-related data, offering enhanced visibility and automated price suggestions. Features included:
- Centralized data hub for easy access to essential pricing inputs;
- Real-time visibility of market and competitive conditions. Users view current prices, cost components, inventory, GMDF, strategic, and competitor positions in one glance. Competitor data is sourced from 22 websites across 7 markets, highlighting gaps in Beerwulf's assortment;
- Automated pricing recommendations to optimize margins and highlight strategic opportunities. The tool suggests price ranges based on user-set constraints. It highlights products needing attention, identifies "quick wins" for margin improvement, and pinpoints loss-making items, guiding strategic assortment decisions.
Results
The implementation of the AI-driven pricing toolset had a transformative impact:
- 72% of SKUs showed potential for higher margins.
- Identified 385 products that could become more profitable with price adjustments.
- Predicted a 2% increase in annual revenue following adjustments based on the toolset’s insights.
- Significantly quicker adjustments to pricing and enhanced responsiveness to market changes.
Conclusion
The case shows that strategic technological integration can significantly enhance operational efficiencies and financial outcomes in a new paradigm, especially when an ambitious growth path needs to be met. Crunch's AI-driven pricing toolkit not only streamlined Beerwulf’s pricing processes but also provided the company with critical insights that enable a team to improve margins and find revenue growth.
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