Originally published by Quantzig: How AI Pricing Analytics Improved Store Performance by Analyzing the Competition and Adjusting Pricing Strategies?
Highlights of the Case Study:
Particulars Description
Client A leading fashion designer in Spain grappling with high competition and increased marketing expenditure.
Business Challenge Launching a new design using an algorithm to analyze past designs, understand rivals’ pricing strategies, and adopt suitable pricing analytics.
Impact Quantzig provided an AI pricing analytics solution, extracting competitors’ data to optimize profitability and enhance product sales.
Game-Changing Solutions for the Fashion Industry:
AI Pricing Analytics has emerged as a pivotal tool in the dynamic fashion industry. This technology empowers retailers to navigate the volatile market by adopting cost-based or dynamic pricing models. Understanding competitors' pricing strategies is crucial to avoid counterproductive discounting and maintain competitiveness. AI solutions enable retailers to streamline operations, save costs, and remain innovative in a landscape where consumers compare prices and demand value. Technological innovations like AI and machine learning are becoming instrumental in predicting fashion trends.
The Challenges of the Client:
A leading fashion designer from Spain faced challenges such as transportation bottlenecks, inaccurate apparel pricing, tracking unessential competitors, and a lack of insight into competitors’ prices and discounts.
Quantzig’s Pricing Analytics Solution for Designers:
Quantzig deployed an AI-driven pricing analytics solution, offering a 360° view of competitors’ data. The algorithm analyzed client pricing, combined it with marketing and sales data, recommended consumer preferences, and introduced a suitable pricing analytics model. The solution empowered the client to optimize pricing, conduct competitive benchmarking, and monitor real-time price gaps.
Impact Analysis of Quantzig’s Pricing Analytics:
Quantzig’s solution resulted in improved sales margins, standardized discounts, increased global sales, competitive product pricing, enhanced fashion design, and a robust marketing plan. The client experienced increased retail pricing transparency and key outcomes included:
- Improved sales margins from 4% to 13%
- Standardized discounts, improving global sales by 37%
- Creation of new opportunities with competitive product pricing
- Enhancement of fashion design and marketing plans
- Increased retail pricing transparency by 21%
Key Outcomes:
Quantzig’s pricing analytics solution leveraged the client’s customer database for understanding consumer preferences, optimizing pricing, and adjusting strategies based on demand. The solution contributed to effective fashion design, merchandising, and marketing plans without compromising profitability.
A Broad Perspective on the Role of Pricing Analytics in the Fashion Industry:
Over the last five years, pricing analytics has gained significance in the fashion industry to address counterproductive discount pricing. Accurate pricing is crucial for increasing sales, and designers are adopting pricing analysis solutions to reduce marketing expenditure, increase margins, and stay ahead of the competition. Quantzig’s solutions effectively track competitor pricing and enhance consumer preferences based on discount pricing.
Key Takeaways:
- Evaluated client’s pricing, marketing, and sales data to derive consumer preferences
- Devised a roadmap for value-based product categorization
- Improved understanding of rivals’ pricing strategies
- Determined optimal selling prices for products
- Improved standardized discounts by 37%
- Helped in reducing marketing costs
