Pricing Segmentation and Analytics

by Mark Ferguson, Tudor Bodea

Pricing analytics uses historical sales data with mathematical
optimization to set and update prices offered through various
channels in order to maximize profit. With this outstanding contribution
to this subject, you will learn just how to identify and
exploit pricing opportunities in different business contexts.
Each chapter looks at pricing from an economist’s viewpoint
beginning with the basic concept of pricing analytics and
what type of data are needed to use this powerful science; the
common assumptions regarding the customer population’s
willingness-to-pay are discussed along with the price-response
functions that result from these assumptions; examples from
several industries and organizations; dynamic pricing, with a
special emphasis on the most common application—markdown
pricing; the new field of customized pricing analytics, where
a firm responds to a request-for-bids or request-for-proposals
with a customized price response; and the relevant aspects of
behavioral science to pricing. Additional examples include the
asymmetry of joy/pain that customers feel in response to price
decreases/increases.

199 pages, Kindle Edition

First published September 30, 2011