Find the Right Price with A/B Testing
Price optimization technology provider Boomerang Commerce has unveiled an A/B Testing platform that enables retailers to quickly test various pricing strategies.
With the solution, retailers can optimize prices across channels at varying frequencies, with pure-play e-commerce retailers being able to test prices dynamically in real-time while "click and mortar" retailers can run tests with smaller frequencies. According to Boomerang Commerce, its A/B Testing platform uses modern “explore and exploit” methods to account for both internal and market elasticity of demand, which enables retailers to continuously optimize prices in a fast changing and competitive environment.
“Merchandizers and pricing analysts at click and mortar retailers have had to wait months to draw conclusive results from price tests,” said Boomerang Commerce’s CEO, Guru Hariharan. “In the digital world, you don’t have that kind of luxury. You need to make decisions quickly – often with limited data. This is why we believe that facilitating rapid testing of pricing strategies will help them figure out a way to set the right prices for their products in a timely manner.”
With the A/B Testing platform retailers can test various pricing strategies and algorithms and measure the performance of each strategy to determine which one maximizes revenues and profits. While in beta, Boomerang Commerce notes that the price-testing platform helped its customers drive revenue and profits for millions of SKUs. Plus, the platform has helped improve the price perception from the customer’s viewpoint, which is measured by the Price Perception Index (PPI). By tracking PPI improvements, retailers can monitor their competitiveness.
“Our customers now spend 80 percent of their time where they should – on price modeling and testing, as opposed to fighting operational and reporting challenges in price tests,” said Hariharan. “With this release, Boomerang Commerce has democratized price testing – a technology that was available only with the most advanced retailers in the world.”