Why Is It So Hard to Get End-of-Season Markdown Pricing in Retail Right? Here Are Three Essentials for Better Results
As retail & e-commerce organizations prepare for end-of season sales, category/pricing managers will spend lots of time and effort on defining the appropriate end-of-season discount or so-called markdown for each product.
To improve this process, we have developed dedicated pricing algorithms - that have been proven to increase turnover 4-10% for omnichannel retail and up to 30% for pure on-line players.
Yes, you have read that, right! We'll explain how such is possible in the whitepaper below.
The dedicated pricing algorithms we've developed have been proven to increase turnover 4-10% for omnichannel retail and up to 30% for pure on-line players!
We have come to believe that the two main shortcomings of the traditional approach to markdown pricing are ‘not knowing how products respond to markdowns’ and ‘having an unclear or incorrect goal’. How a product will respond to a given price change is often guessed based on experience - rather than estimated using data. Moreover, even if the guess proves to be correct, what the optimal price for a product is often remains unclear.
That is why we advise retailers to take three essentials actions in order to get markdown pricing at the end of a season right:
- Action Nr. 1: Use your data to predict price elasticity;
- Action Nr. 2: Revise Whether You're Aiming for the Right Target;
- Action NR. 3: Provide User-Friendly Tools to the Decision Maker.
Eager to learn more? Have a look at the full whitepaper to find specifics and additional tips!
Download the full whitepaper here!
Want to learn more about what actions to take in order to improve the results of end-of-season markdown pricing? Download the full whitepaper here.