Launch of RBP 2.0: Elevating Pricing Optimisation with AI-Driven Elasticity Models
At PricingHUB, we are excited to introduce our latest innovation: RBP 2.0. This new solution is designed to help retailers like you take your pricing strategy to the next level by integrating advanced elasticity models into our already powerful Rule-Based Pricing solution.
We’ve created a short video to explain why RBP 2.0 is a game changer for retailer’s pricing strategies.
Why Did We Create RBP 2.0?
Our mission has always been clear: to empower you by turning pricing into a strategic lever for growth, profitability, and performance leveraging consumer centricity.
Over the years, we’ve seen first-hand how integrating price elasticity into optimization models can have a profound impact on commercial performance. Retailers who use our customer-centric pricing solution named Target based Pricing consistently see improvements in both revenue and margin protection. In 2023, we have delivered significant value creation to our customers: +3.5% of gross profit, +1,8% of revenues, +0,7% of volumes (compared to control groups).
However, we’ve also understood that Target-Based Pricing doesn’t fit for all retailers. While it works well for those who can update prices frequently and are comfortable with less granular constraints, it may not be the best fit for everyone. That’s why we’ve been developing an enhanced version of our Rules Engine, aiming to blend the best of both worlds and better meet the diverse needs of our clients!
RBP 2.0 is our next step in delivering on this mission—offering even more precision, automation, and intelligence. RBP 2.0 combines the granularity of traditional pricing systems for competitive alignment with the consumer-centric price optimization needed to meet today’s retail challenges. It’s a tool designed to help you build precise, data-driven pricing strategies that not only protect your margins but also fuel growth and adaptability.
How Does RBP 2.0 Work?
RBP 2.0 enhances our existing Rule-Based Pricing solution by embedding AI-generated elasticity models that take pricing optimization to a new level. This allows pricing teams to define their own rules and optimise for their specific business KPIs within the defined price corridor.
Unlike Target based Pricing, which relies on experimentation (reinforcement learning models), RBP 2.0 leverages historical SKU-level data. This means you skip the learning phase of experimentation and go straight to optimizing prices, ensuring faster results.
What Can RBP 2.0 Do?
RBP 2.0 delivers a high degree of operational automation while offering flexibility and control.
Some of our key features include:
- Granular price construction using multiple product attributes such as margin levels, stock levels, competition index, rounding rules, and product segmentation.
- Store-level tariff rank computation, allowing precise pricing tailored to individual locations.
- Multiple pricing scenarios that allow you to model and compare outcomes based on different strategies.
- Product linking rules management for more streamlined product categorization.
- Impact simulations that offer visibility into the potential outcomes of your pricing changes before they are implemented.
- Optimization of prices based on price elasticity, helping you meet business KPIs with precision. Ex: I want to optimize my profit while respecting my two constraints: maintain a price index of 107,3 and a maximum of 2 price changes per week.
- Measurement of incremental performance, ensuring continuous improvement and tracking of results.
A New Era of Pricing Optimization
With RBP 2.0, we are merging the best of two worlds—granular price construction and KPI-driven optimization—into a solution that meets your modern demands. By harnessing the power of AI pricing models, RBP 2.0 will help you unlock new levels of commercial performance and stay ahead of the competition.
Ready to take the next step in your pricing strategy? We’re here to help you choose the solution that best aligns with your strategy and needs—whether it’s Target-Based Pricing or Rule-Based Pricing 2.0. Reach out to us, and we’ll guide you toward the ideal approach to elevate your pricing strategy!