Case study · Sun protection
Portfolio Pricing Optimization
Measured shoppers’ willingness to pay item by item, then split the portfolio into premium and competitively priced roles.
Client
A sun protection products manufacturer
Industry
Sun protection
Result
$15MM revenue growth
Capability
Pricing Optimizer
The situation
What the client was facing.
The client wasn’t sure of the relative value of the items in its sunscreen portfolio. Prices were simply set as a gap to the main competitor. It wanted the right portfolio structure — and to find room for new products.
Prices set only as a gap to one competitor
Unclear value of each item in the portfolio
No view of new-product opportunities
Our approach
How we got there.
Methods used
- 01
Assessed current price gaps against competing products
- 02
Ran a discrete choice analysis to estimate willingness to pay for client and competitor items
- 03
Defined each item’s role — which could carry a premium and which should compete on price
- 04
Built a tool to test multiple price points and their impact on the portfolio
- 05
Developed optimal portfolio pricing and sized the opportunity
Value created
$15MM
revenue growth
Shoppers will pay substantially more for “baby” and “pure & simple” (chemical-free) products
Split the portfolio into regular and special-purpose items
Premium pricing for special-purpose items; competitive pricing for regular items
Sized the value of a better-optimized portfolio, with action steps to capture it
More client work
Related case studies.
$75MM
revenue growth
Pricing Strategy
Replaced deal-by-deal, one-size-fits-all pricing with a tiered, elasticity-based strategy across the portfolio.
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revenue growth
Growth Strategy and Size of Prize
Sized the distribution opportunity by market and retailer, and set where a fast-growing frozen brand should — and shouldn’t — expand.
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increase in promotion ROI
Promotion Optimization
Rebuilt trade promotion — the second-largest line on the P&L — around profit, with new tools, a simulator and a fairer funding model.
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