WEBVTT

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The Uniform Game is for
industries where you have a

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really broad competitive set and
a really broad customer set

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and customers are very responsive to
elasticities in that intense

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competitive environment.

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In terms of industries, most
retailers fall into that type of game

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and also CPG companies.

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So really industries where
there's a lot of different

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players and they're competing
for a wide range of customers.

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And then those customers both
mostly have a pretty uniform

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experience of the product.

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So you're not necessarily having
a very custom tailored offer to each customer.

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It's a pretty exciting time to
be playing this game because you

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can actually really make smart,
informed, analytical choices

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that you couldn't make before.

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I've been working in pricing for over 15 years.

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But now the data science has advanced so far that
companies can actually really

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measure all of the price changes
they've made over history, and

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really understand what the
elasticities of their business

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are in a really robust way, by
looking at those price changes over time.

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And the models are sophisticated
enough to take in all kinds of

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interesting sources of data.

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And so bringing in all of those
other signals lets you really

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tease out from a very noisy
picture what is really being

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driven by a price change. And
that wasn't possible even five years ago.

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So when we think about what
pricing models and strategies

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work well in the Uniform Game, again,
this is a super competitive environment

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and it's an environment where
elasticity is really important.

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Really robust price elasticity models are critical.

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Really understanding how you make a

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profit and understanding that in
a robust way that goes beyond

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typical gross margin
calculations that companies do.

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You make different pricing
decisions when you really

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understand what your
profitability equation is like.

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And so in a competitive
environment like this, you have

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to be able to dynamically
respond to that, and respond to

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that differently by channel and
by location that you're serving.

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And you have to respond to that
in a way that recognizes the

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game theory of what happens if you move
and then someone else moves,

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and how do those different moves
happen relative to each other.

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Companies face a lot of
challenges when playing the

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Uniform Game.

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First of all, it's a big data
challenge.

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Companies also have a challenge
of bringing together the art and

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the science.

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So a lot of what you can measure
and a lot of the cool and

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advanced sophisticated models
get into how customers will

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respond tomorrow.

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But they really do need to think
about how customers will make

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decisions six months, 12 months
from now.

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And you're protecting that
relationship so that you drive

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long term profitable growth.

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I think it's really tempting to
think that only really big

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companies can play this because
you have to build super fancy

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data science models.

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I just helped a smaller private
equity owned client think

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through how they could play this
Uniform Game really well, and

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how they could have a scrappy
version of the best-in-class

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analytics that some of the big
companies have, and how they

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could use them in tools that are simple.

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It's not as dynamic and cool as
something that some of my bigger

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clients would build, that's
reacting in real time and makes

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price moves every day and
sometimes even more

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frequently online.

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So I think there's an answer for
how to play this game for

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companies of all sizes.

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Companies can maintain a
competitive advantage in a

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Uniform Game by having real
capabilities that they own and

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that they're continuously
improving.

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So it's very critical that as
you're thinking about how you're

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going to make pricing decisions
going forward, you're thinking

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about how you build capabilities
within your organization.

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So if you think this is
something that you build a

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really cool model and a really
cool set of software and this is

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the answer, that's not the end
of the story.

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For it to be a competitive
advantage, all of the thought

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that goes into that model has to
be embedded in your entire

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organization and how they think
about pricing.

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So if you're a retailer, your
merchants need to be very

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thoughtful about how they're
designing product. And you need

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to have a process that makes
sure that your merchants are

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thinking that way and
continuously on top of what

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customers will pay for.

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And no tool or software will
do that. But it's equally

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critical to invest in the people
and the processes and the

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strategy that wraps around that,
and the muscle and creative

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energy that's required to keep
that competitive advantage if

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you want to continue to win in
the marketplace.