Issue link: https://pros.com/learn/i/1180904
Leading Teams Have Set a Higher Bar So what are the most "evolved" and "mature" pricing functions doing today? What does the height of best practice in B2B pricing actually look like right now? What defines the "5G smartphone" for B2B pricing? Through our research, we've found that the leading B2B pricing functions are: Using advanced data science, predictive algorithms, artificial intelligence, and machine learning... To generate personalized price points for each and every transaction... That are optimized for price sensitivities, operational constraints, as well as various strategic and financial objectives... And delivered directly to the point-of- sale and quoting systems... In near real-time, at a minimum. Yes, this is pretty heady stuff! And as you might imagine, these capabilities are very potent and competitively advantageous. In most cases, it took these pricing teams years of incremental improvement, trial and error, and significant levels of investment to achieve this degree of capability. Some had to create their own internal data science groups to develop the models and algorithms. Others had to poke, prod, bribe, and threaten various vendor partners into developing what they really needed. But over time, these teams have managed to redefine the state-of-the-art and set a new bar for "best practice" in B2B pricing. © Copyright MindBrew • All rights reserved. • May not be used or reproduced without permission. A Parallel Evolution in Tech In parallel, we've also witnessed a dramatic evolution taking place in pricing technology. In capability, pricing technology has evolved from merely automating routine processes to now being the full-blown "smart systems" enabling and facilitating the cutting-edge best practices highlighted above. Working with leading pricing teams, the top technology vendors have codified these best practices into their software solutions. And their data scientists have developed libraries of configurable predictive algorithms and analytical routines for generating optimized prices on a deal-by-deal basis. Beyond the evolution in capability, pricing technology has also evolved in the area of delivery and accessibility. In the past, sophisticated price optimization solutions involved on-premises installations, onerous integrations, and perpetual license agreements with sizeable upfront fees. Today, however, the most advanced price optimization solutions are software-as-a- service (SaaS) offerings, delivered from the cloud. With standardized integrations and subscription-based fee structures, these technologies are now accessible to a much broader range of companies.