If you want to submit a story for the risk-blog Editors to peer at it, and perhaps post it for all to share and enjoy, email it to "blog at approximity.com". Subscribe to email updates.

Risk Management Blog home.

Saturday, September 25, 2004

<Pricing> Which Price is Right?

Interesting article from Fast-Company about pricing.

Zilliant's software runs experiments. You pick a goal -- maximizing total profits, for instance -- and then you start selling stuff, the same stuff, in fact, just at slightly different prices. You don't just take a flier and raise your prices 5% and see if anyone flees to a competitor; you don't just drop your prices 15% and hope that the price brings in 20% more business. You test, you sell, you gather data -- you see what works. Then you change your prices -- maybe 4% up, maybe 6% down -- when you know what's going to happen.

 

How long will it take till SAP or Oracle will buy one competitor and take over the entire price optimization (PO) industry? One more article