Case study · Food & condiments
Pricing Strategy
Replaced deal-by-deal, one-size-fits-all pricing with a tiered, elasticity-based strategy across the portfolio.
Client
A large food and condiments manufacturer
Industry
Food & condiments
Result
$75MM revenue growth
Capability
Pricing Optimizer
The situation
What the client was facing.
The client had no consistent pricing strategy. Pricing was tactical and reactive, highly seasonal products were priced the same way as everyday ones, and prices were largely set in individual negotiations with retailers.
Pricing was reactive to the market, not planned
Seasonal and non-seasonal products were treated the same
Prices were set deal by deal with each retailer
Our approach
How we got there.
Methods used
- 01
Examined current pricing by channel and retailer to find realignment opportunities
- 02
Modeled own-price and competitive price elasticities for seasonal and non-seasonal products
- 03
Turned the results into pricing tiers across the portfolio
- 04
Simulated price points to see the effect on own and competitor volume
- 05
Developed optimal pricing across the portfolio
Value created
$75MM
revenue growth
Manage price gaps across channels so shoppers aren’t pushed from higher-margin to lower-margin channels
Price surgically: staples and everyday items are more price-sensitive than seasonal products
Manage your own price first, before reacting to competitors
Build brand equity for seasonal products instead of pricing them aggressively
More client work
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Portfolio Pricing Optimization
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Growth Strategy and Size of Prize
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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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