Content supported by: Perplexity AI
Setting the Scene
A leading UK retailer had the enviable challenge of managing pricing and promotions across a nationwide network of stores, robust eCommerce platform, and expanding mobile service fleet. Traditional pricing decisions were manual, time-consuming, and many promotions actually eroded profit margins rather than driving incremental sales.
Impact Metric
Net profit improvement [the measurable increase in profitability through AI-driven pricing and promotion optimisation]
Who is the Client
A prominent UK-based retailer specialising in motoring and cycling products and services, operating nationwide stores, a robust eCommerce platform, and an expanding mobile service fleet and garage network. With a loyalty programme supporting over 5 million members, the organisation serves a dedicated customer base across multiple channels.
Business Challenge to Solve
- Eliminate promotions that failed to deliver incremental sales and eroded margins
- Replace manual, time-consuming pricing decisions with agile, market-responsive strategies
- Leverage vast customer and transaction data to drive profitability
- Build sustainable competitive advantage through intelligent automation
Capability Intent
The retailer committed to transforming from manual, intuition-based pricing decisions to an AI-driven, data-informed approach that would protect market leadership whilst maximising profitability. They aimed to leverage their vast data assets across eCommerce, loyalty schemes, and in-store transactions to create sustainable competitive advantage through intelligent pricing and promotion strategies.
Client Promise
Strategic pricing agility, profitable promotions, automated efficiency
Solution
An AI-driven transformation programme built on three strategic pillars: Smarter Pricing, Effective Promotions, and AI-Powered Efficiency. The solution implemented machine learning models to analyse price elasticity for every product, deployed AI engines to forecast promotion impact, and automated routine pricing tasks to free teams for strategic initiatives.
The 12-month programme was structured across three phases: Foundational Analysis & Quick Wins, AI Model Development & Piloting, and Scaled Implementation & Continuous Optimisation. Each phase delivered incremental value whilst building towards comprehensive transformation.
The solution enabled strategic price increases on non-sensitive items whilst protecting price perception on Key Value Items (KVIs), eliminated loss-making promotions, and created intelligent price zones based on local competition and demand patterns.
Early indicators of success: The automated analysis engine immediately identified and eliminated the bottom third of underperforming promotions, delivering rapid savings.
Localised pricing strategy applied to just 10-15% of the assortment unlocked 1-2% margin improvement.
What’s Next
The client now possesses an intelligent, agile, and automated pricing and promotion capability that positions them as a market leader capable of responding dynamically to consumer behaviour shifts and competitive landscape changes. The foundation is established for continued AI-driven revenue optimisation and strategic growth initiatives.
