The Right Price for The Perfect Shoe

Exciting dynamic pricing platforms allow retailers to price-manage huge stocks of countless items, in real-time, knowing that their pricing is optimal


Many retailers grapple with a dilemma that we like to call “The Seventy Shoes Dilemma”. Let us explain. Let’s say a shoe retailer sells 70 kinds of shoes. These shoes are all modeled exactly the same. The only difference is in the colors and patterns. How does the retailer price each shoe? Does the retailer price them all the same, or does it stamp different prices for different patterned shoes?

If the Shoe Sells, Wear It

When the shoes are the same, it’s kind of hard to predict which shoe design will sell better than the others. The shoes are just a metaphor – the same goes for t-shirts, jeans, dresses, etc. Most retailers will begin with a little “trial and error”. At first, some may price all shoes exactly the same, and gradually change the prices based on customer behavior. Some may try to predict potential best sellers and raise the price accordingly in advance. The bottom line is this: when retailers have many products that are very similar, they can utilize many pricing scenarios. And once all shoes (or all other items) are introduced to customers on the sales floor, dynamic pricing optimization can come in very handy.

Customer Behavior Analysis

Once sales data is entered into the retailer’s computerized system and analyzed, store management can better understand which shoes their customers liked best, and which received lesser degrees of attention. Once this preliminary data comes in, they can effectively manage their shoe prices via dynamic pricing.

Dynamic pricing works really well after customer data analysis. When retailers have numerous items in stock that are virtually identical, they can begin to optimize specific prices for specific items in real-time. The more day-to-day data they accumulate, the sharper their pricing optimization. The result is larger profits and a better bottom line.

The Simplicity of Pricing Management

Before the current era of cutting-edge dynamic pricing, daily price management for 70 virtually identical shoes seemed like an impossibility. It was a tough task to perform manually via excel sheets. So naturally, pricing managers moved at a much slower pace. Price changes, if they occurred, took place on a weekly or monthly basis, at best.

This is not the case today. Exciting dynamic pricing platforms allow retailers to price-manage huge stocks of countless items, in real-time, knowing that their pricing is optimal. They can work a lot less and receive vast amounts of valuable data. This data helps them make the best decisions, day in and day out.

At the end of the day, retailers may not sell their entire 70-shoe model stock. Some models will sell better than others. But with dynamic pricing, the shoes that do sell will most likely sell at the most profitable price. In today’s retail world, that means a lot.


You might also like:

Pricing Optimization
Anat Oransky Lev, VP Marketing

Planning Your Pricing Strategy for the Holiday Season

The holiday season is a great time to boost your sales, but it also presents a unique challenge: how do you price your products differently when the demand for them is so high?

Price too high, and you miss sales and revenue. Price too low and your margins erode.

Read More »
Pricing Optimization
Pini Mandel, Co-Founder & CEO

Vertical: Dynamic pricing for DIY Retailers

DIY Retailers face fierce competition for sales and intense pressure to improve margins. While traditionally DIY retailers sell paints and tools, today they also compete in other categories selling anything from household goods to various types of electrical appliances.

Read More »
Pricing Optimization
Pini Mandel, Co-Founder & CEO

Vertical: Practices and Trends in Dynamic Pricing for Grocery Stores

Grocery stores today are under intense price pressure as a result of supply chain challenges, competition and rising costs. Knowing how to increase share of wallet among current customers and attract new customers has become critical to the survival of struggling grocery stores. A critical component of this process is instilling a favorable price-value image in the minds of consumers.

Read More »
Skip to content