Originally published by Quantzig: Quantzig’s Pricing Analytics Engagement Helps a Leading Frozen Food Manufacturer Adopt a Predictive Pricing Strategy and Boost Profit Margin
Client’s Goal
A leading US frozen food manufacturer partnered with Quantzig to implement a robust pricing analytics strategy. Their aim was to identify price management initiatives, optimize product pricing, enhance customer retention, and ensure long-term profitability in the fiercely competitive frozen food market.
Outcome
Quantzig's pricing analytics study uncovered pricing misalignments, enabling the client to readjust their pricing model. The optimized strategy not only increased profit margins but also predicted the immediate impact of price changes and promotional activities. This approach enhanced brand integrity, ensuring substantial customer retention.
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Global Frozen Food Market
Consumers' preference for frozen food products is on the rise due to their convenience. Factors like increased purchasing power, evolving food habits, and the proliferation of large retail chains contribute to the growing demand for frozen food. However, challenges such as the preference for fresh and organic food and intense competition pose hurdles to the market's growth.
Industry Challenges
- Preference for Fresh and Organic Food: Consumer belief that frozen food contains preservatives and harmful packaging materials hinders the adoption of frozen products.
- Competitive Pricing: Establishing a strategic pricing model that aligns with the market while maintaining profitability and retaining customers is a significant challenge.
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Client Background
A renowned frozen food manufacturer based in the US.
Client’s Challenge
The client lacked insights into the dynamic frozen food market, hindering their ability to plan an optimized pricing strategy. This led to challenges in competing on price in contracts with leading food retailers.
Business Impact
Quantzig's pricing analytics experts provided the client with an accurate pricing performance measurement, enabling the development of a predictive pricing model. This model offered visibility into product profitability, aiding critical decision-making regarding price adjustments, tax considerations, and production costs. The result was increased profits and a competitive edge.
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Pricing Analytics Solution Insights
Quantzig's pricing analytics solution delivers real-time updates on product demand and customer purchasing behavior. This enables frozen food companies to adopt an elastic pricing strategy, adjusting prices based on product performance. The solution also facilitates a structured approach to brand campaigns, leading to significant cost-savings.
