QL CASE STUDY:

GENERATING HIGHER PROFITS

FROM A PRODUCT MIX
THE CLIENT
An international European grocery chain that stays competitive by selling some
products at a loss and other products at low margins. The chain has both retail and
online sales points and realized that a digital transformation was required if they
were going to successfully compete in today’s marketplace. However, this program
focused on their online store.
The Main Challenges
The chain was tabulating its pricing using manual calculation techniques, which was contributing
to significant revenue leakage. They needed to introduce a dynamic pricing tool into their system,
to keep up with the competition.

Additionally, the chain needed to rethink their pricing strategy. Grocery stores have a number of
loss-leader products that are sold at or below cost. Rather than focusing on individual products,
the grocer wanted to devise a pricing strategy that focused on increasing the gross profitability
of the overall cart rather than the individual items within the cart.

The QL Solution
Quicklizard introduced a machine-learning dynamic pricing solution to the grocery chain,
which immediately protected the company from revenue leakage due to calculation
and input errors.

The QL system began following users’ clickstreams and analyzing shopping carts, to
understand purchase patterns and buying habits. The AI-based platform then utilized
 an algorithm that aggressively updated prices multiple times throughout the day on
the supermarket’s website. It used A/B testing and actual user behavior to test how
consumers reacted prices.

Throughout the project, prices were adjusted with the goal overall of increasing cart
profitability. Some items experienced price cuts, while others saw their margins increase
significantly.

The Result
Machine learning is an ongoing process that relies on thousands of transactions and
user interactions. Within a short time frame, the grocer began seeing a 3-5% increase
on gross profits per cart.

The Future
With profits increasing, the grocery chain is looking at additional ways to optimize profits.
There are three initiatives that they are looking at over the upcoming quarters. First,
they plan on experimenting with personal prices for individual users based on historical
buyer behavior. Second, they intend to expand their dynamic pricing, at least in part, to
their brick & mortar outlets. Finally, they are planning on introducing clearance pricing
for merchandise that is nearing its expiration date.

CONTACT US AT : www.quicklizard.com info@quicklizard.com

Quicklizard is a global solution provider that helps retailers make smart real-time pricing decisions across online
and offline channels. Relying on accurate data analysis, QL's dynamic AI platform allows businesses to adjust
prices with maximum precision, quickness, ease and efficiency, as a basis for enhanced profit and revenue.