Excel, we could spend a long time singing the praises of this tool that we love as much as we hate it. And yes, Excel has long had a key role in the management of pricing strategies. But this time is over.
In the era of digitalization, artificial intelligence and machine learning, using Excel means under-optimizing your pricing strategies.
Here are 5 reasons to finally say goodbye to Excel and switch to a more powerful pricing optimization tool:
1. Increase your reactivity
We live in a world where instability is becoming the norm. To adapt to such a changing environment and remain competitive, it is necessary to increase your reactivity. The automation of price optimization allows to instantly adapt the prices of products when a variation of the purchase price, the competitor’s price or the stock and demand level occurs.
The use of a tool that generates automatic price recommendations is much more efficient than an Excel spreadsheet to quickly deal with these variations.
2. Improve the granularity of your pricing strategies
The attributes of your products are essential elements in the construction of your pricing strategies. Indeed, segmentation, inventory level, demand, product life cycle and characteristics, etc. all make it possible to build granular strategies to optimize the prices of a product catalog.
As your level of granularity increases, you will be able to make specific price adjustments and thus increase your profitability.
3. Optimize all prices of a product catalog
Manual optimization in Excel does not allow you to optimize the prices of an entire product catalog. In the absence of automation, depending on the volume, only 10 to 30% of the references are actively optimized, according to the discussions we have had with several retailers. And, it goes without saying that the fewer products that are price optimized, the fewer opportunities there are to increase revenue.
Using a pricing optimization solution means you can optimize the prices of your entire product catalog and access an unexploited profit pool!
4. Avoid human error
We can all be the best, we still make mistakes sometimes. Where a manual pricing management on Excel only allows few errors to be detected, a modern Big Data tool usually offers the possibility to automatically detect some data errors. Our solution allows for example to automatically and instantly detect purchase prices at 0€ or products with a price below the SRP.
The BCG has published an interesting study on this subject. Revenue Assurance”, defined as the use of adequate tools and processes by a dedicated and qualified workforce, can contribute up to 10% of a company’s global turnover, without selling more products or services.
Optimizing your internal resources is therefore a crucial topic to increase the profitability of your activities!
5. Focus on optimizing pricing strategies
Automating your data flows and using a pricing optimization tool gives you more time for strategic thinking.
After all, when you take a step back, it is not the data research and integration on your Excel that will create added value. On the other hand, refining your pricing strategies and working on the analysis of value creation, yes! It’s time to focus your resources on value-creating activities and let artificial intelligence replace you on time-consuming tasks.
And we conclude with the words of our CEO, Jérôme Laurent:
“Optimizing your pricing on Excel in the age of AI is like doing your accounting with paper and pencil in the age of Excel.”
If this last argument wasn’t enough to convince you, a conversation with one of our team members might be in order… Let’s discuss it!