Almost every industry and business is facing disruption today due to the global pandemic. Many small businesses are unable to sustain in these difficult times and the businesses that have managed to keep their doors open are faced with tremendous pressure.
During these times, large enterprises offering B2B or B2C services could step up to help those in need.
What better way to do that than by lowering or waiving fees?
It is important to perform price changes in a timely fashion for it to really benefit customers. In this context, it only makes sense to discuss how technology could power price changes in an organization, making it very nimble and efficient.
There are multiple levels in the pricing excellence framework. As organizations grow and mature with their pricing strategy, they tend to move higher up in the ladder by delivering value on time to their customers.
Building system integrations with appropriate checks and balances puts companies in a position to tweak pricing as needed. This calls for the importance of investing in platforms and technology to power pricing.
How can technology power faster price changes?
It’s critical to incorporate agility when making price changes. Here are three key factors to consider:
1. Investing In Pricing Software Solutions To Assess Impact Pre Price Change
When there is extreme pressure to make price changes, it is important for businesses to validate the changes they make in terms of their bottom line.
Imagine doing that on a deal by deal basis manually or as a guesstimate – of course it is going to be time consuming and prone to errors.
To avoid rushed decisions, investing in a well thought out pricing software can easily help analyze the impact. Building integrated systems that can connect with data and provide visibility into the P&L become very crucial.
Name any kind of pricing: headline, negotiated, product, vertical – having an automated mechanism to pull up the numbers and to back up the decision is crucial.
2. Using A Robust Platform To Perform Timely Price Changes
As important as it is for companies to innovate and deliver value to customers, it is equally important to do so in a timely and scalable manner.
When the need for time and scale play together, it can get really intimidating sometimes. Looking back at some of the biggest price changes that have been done, I can only be reminded of what Operations team members told us about the days and nights that were saved with the right set of pricing tools in place.
Investment in technology can save teams a lot of time and quickly help customers in need.
3. Building Analytics And Insights To Track Post Price Changes
What was described above was still a prediction or forecast based on historical data – it is not real.
As important as it can be to know the impact before a change is made, it is equally important to have a system in place to measure and report on the actuals.
Converting data into information and information into insights will allow companies to close any gaps they may have in their forecasting process.
Building capabilities to perform descriptive look back analytics both proactively and reactively will add value to the entire stack. It will also feed into determining the right capabilities to make massive price changes.
For example, if there is a trend that indicates the need to change specific price points across certain countries – this will feed into the platform to have a capability that can be flexible enough to make those changes easily and quickly.
Last but not least, is the need have a solid process to implement solutions involving all three points above – because they are going to disrupt the way things would have otherwise happened, i.e. at a slow pace with several man-hours going into them.
Identifying and implementing a systematic solution with the right pricing tools and processes is just the beginning of a pricing transformation, that requires significant changes within an organization.
Change management is crucial to reduce resistance to change, facilitate the organizational transformation, and ensure the adoption of the new systems, tools and processes in organizations that are inherently wired to preserve the “status quo”.
About The Author:
Kalpana Sundar is director of product management in the Pricing organization at PayPal. She is responsible for building and scaling products and platforms that facilitate price management, pricing sciences and analytics. Kalpana earned her Bachelor of Engineering from the College of Engineering, Guindy and her MBA in Customer Relationship Management from Symbiosis, Pune.