Revenue Growth Management – the backstory
In the 1990’s, businesses struggled with an uptick in demand and the need to better price and forecast. This prompted retailers to leverage concepts pioneered at Ford with targeted pricing in the form of discounts and promotions to more accurately match supply with demand. Promotions planning and optimization assisted retailers with the timing and prediction of the incremental lift of a promotion for targeted products and customers sets.
Airlines
Low-cost airline carriers were stealing business. To combat this, high-cost carriers began to analyze and predict passenger volume and when to use discounted fares. This maximized passenger capacity and ensured margin targets.
Consumer Products Manufacturers had to rapidly adopt price and promotion optimization to maximize revenue because investors placed pressure on them to continue growth by 6 – 8% in an industry which typically grows 3% organically, year over year.