SITUATION
- In 2022, retail sites faced significant challenges with the high price environment
- Sites were experiencing declining volumes and revenue
- Traditional pricing methods were not effective in this volatile market
- Needed innovative approach to maintain profitability while remaining competitive
Figure 1: Visual representation of the pricing optimization challenge in a high-price environment
TASK
- Develop an innovative approach to price optimization in challenging market conditions
- Create a solution that could improve volumes while maintaining margins
- Design a methodology that could respond dynamically to competitor and own site pricing
- Implement within tight timeframe to address urgent business needs
Innovation Timeline
CHALLENGE
High price environment reducing volumes
INNOVATION
Information entropy solution
TESTING
A/B testing & field trials
RESULTS
x% volume/revenue increase
ACTION
- Introduced an out-of-the-box solution using information entropy to dynamically adjust prices
- Led the initiative from concept to implementation, taking ownership of the entire process
- Brought business and pricing analysts into confidence to ensure buy-in and practical application
- Coordinated with both internal and vendor data science and engineering teams
- Designed and oversaw A/B testing protocols to validate the approach
- Piloted the solution in select markets before full deployment
- Applied innovative thinking where traditional ML methods would have failed
Figure 2: Cross-functional collaboration between business, data science, and engineering teams
Business
Pricing Analysts
Data Science
Internal & Vendor
Engineering
Implementation
RESULTS
- Improved volumes between across retail sites
- Increased site gross margin
- Solution was proven within 3 months of implementation
- Successfully scaled across sites within 6 months
- Innovation was filed as an invention disclosure
- Demonstrated how innovative thinking can deliver significant business impact when traditional approaches fall short
"Transformed traditional pricing with information theory, delivering rapid results and establishing a new benchmark for pricing optimization."