Pricing Lifecyle

A key part of the 4Ps of marketing (price, promotion, product, and place) is pricing.  One of the complications with pricing is its lifecycle.  The biggest example that we all see around pricing is with airlines.  You can pay all kinds of different prices based on supply and demand, time or day that you buy the ticket, and other factors.

But, clothes, for example, follow a more traditional lifecycle where they initially are listed at the “list” price.  Over time, you see additional markdowns until either the floor price is hit or the clothes are sold off to the secondary market or sent to outlet stores.

Depending on the company, much of this pricing discounts are very rules based.  In some companies, it is more analysis based looking at what is selling and why.  This would be an easy process to automate.  The rules based discounting process could look for triggers (date, inventory level, etc.) to initiate a pricing discount and then launch a subprocess for updating stores and the system of record.  For analysis based processes, the process could link the analysis and the decision making to either automate the steps or potentially automate the decision making as the analysts make their decision making process more transparent.