PROS AI event

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PROS AI event

Last week, I had the opportunity to attend an enlightening event hosted by PROS, our partner company who are at the forefront of AI and pricing solutions. The main highlight was a talk by Michael Wu, who is the Chief AI Strategist at PROS, and a leading figure in the application of artificial intelligence to optimise pricing strategies. Another highlight was a wonderful lunch and a chance to chat to some really interesting people too!

Michael’s talk firstly gave the best explanation I’ve ever heard about how Generative AI and Large Language Models work. It was laden with mathematical terms, but somehow remained accessible and understandable – even to a layman like me! I truly came out far more knowledgeable than when I went in.

This set the scene for a better understanding of how AI tools can be applied to pricing strategy. It became clear to me that the traditional method of segmentation to set pricing is going to be challenged as neural networks come to the fore for many organisations.

The ability to predict and set prices to optimise win rates and actual profit, instead of replying on a segmented focus on price elasticity of demand, gives forward thinking organisations the chance to massively improve the effectiveness of price setting. When this is coupled with the explainability of the decision on price (which in turn demystifies the workings of the ‘black box’ neural network), you ultimately get to set the perfect price with a ’sellable’ rationale.

For businesses, the message is clear: integrating AI into pricing strategies is no longer optional for those looking to remain competitive. Michael outlined several key benefits, including the ability to quickly respond to market changes and personalise pricing at an individual customer level. However, he also cautioned about the challenges, such as the need for robust data infrastructures and ethical considerations too.

In summary, Michael Wu’s insights at the PROS event have shed light on the critical role of AI in shaping the future of pricing strategies. As businesses navigate this evolving landscape, the lessons shared by PROS will undoubtedly play a pivotal role in guiding successful pricing strategies in the digital age.

My thanks go to the team at PROS including Sheida Hadji Ashrafi, Caroline Burns and Charles Bullock for the invitation and the chance to learn from the best, that is Michael Wu PhD.

This post was written by Walpole Partnership’s Managing Director, Andy Pieroux.

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