WO2003060625A2 - Pricing optimization apparatus and method - Google Patents
Pricing optimization apparatus and method Download PDFInfo
- Publication number
- WO2003060625A2 WO2003060625A2 PCT/IL2003/000036 IL0300036W WO03060625A2 WO 2003060625 A2 WO2003060625 A2 WO 2003060625A2 IL 0300036 W IL0300036 W IL 0300036W WO 03060625 A2 WO03060625 A2 WO 03060625A2
- Authority
- WO
- WIPO (PCT)
- Prior art keywords
- offer
- function
- goal function
- goal
- customer
- Prior art date
Links
Classifications
-
- G—PHYSICS
- G06—COMPUTING; CALCULATING OR COUNTING
- G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
- G06Q30/00—Commerce
- G06Q30/06—Buying, selling or leasing transactions
-
- G—PHYSICS
- G06—COMPUTING; CALCULATING OR COUNTING
- G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
- G06Q10/00—Administration; Management
- G06Q10/04—Forecasting or optimisation specially adapted for administrative or management purposes, e.g. linear programming or "cutting stock problem"
-
- G—PHYSICS
- G06—COMPUTING; CALCULATING OR COUNTING
- G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
- G06Q30/00—Commerce
- G06Q30/02—Marketing; Price estimation or determination; Fundraising
- G06Q30/0207—Discounts or incentives, e.g. coupons or rebates
-
- G—PHYSICS
- G06—COMPUTING; CALCULATING OR COUNTING
- G06Q—INFORMATION AND COMMUNICATION TECHNOLOGY [ICT] SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES; SYSTEMS OR METHODS SPECIALLY ADAPTED FOR ADMINISTRATIVE, COMMERCIAL, FINANCIAL, MANAGERIAL OR SUPERVISORY PURPOSES, NOT OTHERWISE PROVIDED FOR
- G06Q30/00—Commerce
- G06Q30/02—Marketing; Price estimation or determination; Fundraising
- G06Q30/0283—Price estimation or determination
Definitions
- the present invention relates to a pricing optimization apparatus and
- US Patent No. 6,078,893 discloses a method for tuning a demand model
- a market model is selected, which predicts how a subset of the parameters in the demand model depends upon information external to the sales
- figure-of-merit function is defined, consisting of a standard f ⁇ gure-of-merit
- Certain consumer products are generally customized. For example, in the case
- the policy premium is determined by the actuarial risk of
- said demand function comprises expected behavior in
- said automatically optimizing comprises taking into account said
- said automatically optimizing comprises iteratively
- said building of said goal function comprises incorporating
- said incorporating of said constraints comprises building an
- the method may further comprise forming a set of non-linear equations
- said solving of said non-linear equations comprises Newton
- said automatically optimizing comprises iteratively
- said demand function representative of said customer is a
- said goal function comprises a term for other income derived
- said building of said goal function comprises incorporating a
- said automatically optimizing comprises using dynamic
- said obtaining a demand function comprises applying
- said demand function comprises expected behavior in
- said optimizer is operable to optimize said goal function
- said goal function builder is further operable to incorporate
- said incorporating of said constraints comprises building an
- said goal function builder is further operable to form a set of
- said solving of said non-linear equations comprises Newton
- said optimizer is operable to iteratively optimize backwardly
- said demand function representative of said customer is a
- said goal function comprises a term for other income derived
- said building of said goal function comprises incorporating a
- said goal function optimizer is operable to use dynamic
- said demand function input is operable to apply logistic
- Fig. 1 is a simplified diagram showing the two-stage approach to price
- Fig. 2 is a simplified balloon diagram showing inputs and an output
- Fig. 3 is a simplified flow diagram showing a procedure for optimizing a
- Fig. 4 is a simplified flow diagram showing additional steps required
- Fig. 5 is a simplified flow diagram showing an overall method for
- the optimization may
- a sale price comprises a cost plus a
- Fig. 1 is a simplified conceptual flow
- the demand function estimated in stage 10 is used as one of the
- optimization of the goal function is thus able to provide a price that is optimized both for the needs of the enterprise per se and
- optimization is not based only on the probability of making a
- Fig. 2 is a simplified balloon diagram
- the goal function 20 is built up from a variable cost 22 ofthe product, a .
- variable cost VC
- VC variable cost
- NC as an estimator and thereby treat it as fixed For example, we can assume
- the demand function relates the probability of a consumer
- the other factors may include for example, competitor's prices and
- Q denotes the probability of a given purchase being made
- P is the product's price
- X represent the customer profile (covariates) which is to say it
- the embodiments present the price
- OI denotes other income expected as a byproduct ofthe selling of
- the main product or service For example, the profit contributed by a complementary product or service that is sold alongside the main product or
- the precise goal function may be varied according to circumstances.
- constraints 26 may be present. Constraints are
- the goal function seeks, for each
- PV t where k denotes the probability that a product or service will end its life
- the discount factor r is the cost of capital ofthe ente ⁇ rise.
- the overall profit ofthe ente ⁇ rise is the sum of each
- maximization of each individual present value preferably gives the overall
- Fig. 3 is a simplified flow chart
- first period 1 the following is executed by preprogrammed software and/or
- step size and ⁇ is the number ofthe current period, ranging from one to the
- the optimization of M t can be performed by exhaustive search on a
- the above algorithm takes ⁇ ( ⁇ N 2 ) iterations.
- the algorithm may be written in sketch computer code as:
- period h typically 3 to 6 periods.
- such an optimization is preferably
- the algorithm is similar to the previous one. It iterates backwards from
- the algorithm may be written in sketch computer code as:
- the algorithm requires ⁇ ( ⁇ h ⁇ N 2 ) iterations.
- the algorithm may also be written in a recursive manner, which is more
- Mtable[t][M t-1 ] M t opt //save the optimal M t return M t opt Constrained Optimization
- embodiments build a Lagranian function, (stage 50 in Fig. 4) which comprises
- GoalFunction ⁇ pv i (M i )
- M denotes the set of all margins for individual i for period 1 to T.
- ⁇ t is the Lagrange multiplier for period t.
- the problem may be reduced to that of finding the
- Fig.5 is a simplified flow chart
- the profiles preferably include any
- the user may feel that a major factor in selling a given product is age.
- a demand function is a function that describes
- each condition can be given a
- weighting ⁇ The weighted conditions can then be summed, and the summation
- stage 66 constraints are entered if any. As discussed above,
- Stage 68 is a decision stage in which the system determines whether
- stage 70 branches to stage 70 in which the procedure of Fig. 4 is carried out to set up an
- stage 72 results are presented.
- stage 74 results are presented.
- the results include both overall results for the client database and individual
- each client can be offered the product at a
Abstract
Description
Claims
Priority Applications (7)
Application Number | Priority Date | Filing Date | Title |
---|---|---|---|
EP03704962A EP1466285A4 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
CA002471830A CA2471830A1 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
IL16269003A IL162690A0 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
JP2003560655A JP2005515531A (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
AU2003207958A AU2003207958A1 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
US10/498,816 US7328164B2 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
US12/000,139 US20080091624A1 (en) | 2002-01-16 | 2007-12-10 | Pricing optimization apparatus and method |
Applications Claiming Priority (2)
Application Number | Priority Date | Filing Date | Title |
---|---|---|---|
US34838002P | 2002-01-16 | 2002-01-16 | |
US60/348,380 | 2002-01-16 |
Related Child Applications (1)
Application Number | Title | Priority Date | Filing Date |
---|---|---|---|
US12/000,139 Division US20080091624A1 (en) | 2002-01-16 | 2007-12-10 | Pricing optimization apparatus and method |
Publications (2)
Publication Number | Publication Date |
---|---|
WO2003060625A2 true WO2003060625A2 (en) | 2003-07-24 |
WO2003060625A3 WO2003060625A3 (en) | 2004-04-29 |
Family
ID=23367777
Family Applications (1)
Application Number | Title | Priority Date | Filing Date |
---|---|---|---|
PCT/IL2003/000036 WO2003060625A2 (en) | 2002-01-16 | 2003-01-14 | Pricing optimization apparatus and method |
Country Status (7)
Country | Link |
---|---|
US (2) | US7328164B2 (en) |
EP (1) | EP1466285A4 (en) |
JP (1) | JP2005515531A (en) |
AU (1) | AU2003207958A1 (en) |
CA (1) | CA2471830A1 (en) |
IL (1) | IL162690A0 (en) |
WO (1) | WO2003060625A2 (en) |
Cited By (1)
Publication number | Priority date | Publication date | Assignee | Title |
---|---|---|---|---|
US7328164B2 (en) | 2002-01-16 | 2008-02-05 | Earnix Ltd. | Pricing optimization apparatus and method |
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JP3922104B2 (en) * | 2002-06-07 | 2007-05-30 | 富士通株式会社 | Point management device, point management system, point management method, and point management program |
US8396814B1 (en) * | 2004-08-09 | 2013-03-12 | Vendavo, Inc. | Systems and methods for index-based pricing in a price management system |
US8452656B2 (en) * | 2005-06-29 | 2013-05-28 | Google Inc. | Prioritizing ad review, by using expected revenue for example, in an advertising system |
US20070118432A1 (en) * | 2005-11-21 | 2007-05-24 | Vijay Vazirani | Systems and methods for optimizing revenue in search engine auctions |
US20070150073A1 (en) * | 2005-12-23 | 2007-06-28 | Jay Dawson | Asset management system |
US20070150295A1 (en) * | 2005-12-23 | 2007-06-28 | Caterpillar Inc. | Asset management system |
WO2007133748A2 (en) * | 2006-05-15 | 2007-11-22 | Vendavo, Inc. | Systems and methods for price setting and triangulation |
US8055521B2 (en) * | 2006-06-05 | 2011-11-08 | Raytheon Company | Optimized component selection for project completion |
US10210530B1 (en) | 2006-08-11 | 2019-02-19 | Infor (Us), Inc. | Selecting a report |
US7729942B2 (en) * | 2006-09-29 | 2010-06-01 | At&T Intellectual Property I, L.P. | Consumer targeting methods, systems, and computer program products using multifactorial marketing models |
US8577791B2 (en) * | 2007-03-23 | 2013-11-05 | Sap Ag | System and computer program for modeling and pricing loan products |
EP2172885A1 (en) * | 2008-09-30 | 2010-04-07 | Amadeus S.A.S. | Method and system for simulating and optimizing revenue from service fees in or relating to online service processes |
US8428915B1 (en) | 2008-12-23 | 2013-04-23 | Nomis Solutions, Inc. | Multiple sources of data in a bayesian system |
US8831978B2 (en) * | 2009-02-27 | 2014-09-09 | Oracle International Corporation | Deal analysis workbench for a customer relationship management environment |
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US8645191B2 (en) | 2010-11-18 | 2014-02-04 | Oracle International Corporation | Product pricing optimization system |
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US9141982B2 (en) | 2011-04-27 | 2015-09-22 | Right Brain Interface Nv | Method and apparatus for collaborative upload of content |
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US8732040B1 (en) | 2011-08-16 | 2014-05-20 | Amazon Technologies, Inc. | Target inventory determination based on hosted merchants presence |
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US10095989B2 (en) * | 2011-11-23 | 2018-10-09 | Oracle International Corporation | Product pricing optimizer |
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US10528903B2 (en) * | 2016-01-07 | 2020-01-07 | Oracle International Corporation | Computerized promotion and markdown price scheduling |
US11151604B2 (en) * | 2016-06-10 | 2021-10-19 | International Business Machines Corporation | Revenue management using dynamic customer selection |
US20200342526A1 (en) * | 2018-02-12 | 2020-10-29 | Michael Ablanczy | Bilateral bidding platform for use in bulk sale of items in an electronic marketplace |
US20230186411A1 (en) * | 2021-12-10 | 2023-06-15 | Oracle International Corporation | Optimized Hotel Room Display Ordering Based On Heterogenous Customer Dynamic Clustering |
US20240062231A1 (en) * | 2022-08-21 | 2024-02-22 | Cogitaas AVA Pte Ltd | System and method for determining consumers willingness to pay |
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2003
- 2003-01-14 WO PCT/IL2003/000036 patent/WO2003060625A2/en active Search and Examination
- 2003-01-14 IL IL16269003A patent/IL162690A0/en unknown
- 2003-01-14 US US10/498,816 patent/US7328164B2/en not_active Expired - Lifetime
- 2003-01-14 EP EP03704962A patent/EP1466285A4/en not_active Withdrawn
- 2003-01-14 CA CA002471830A patent/CA2471830A1/en not_active Abandoned
- 2003-01-14 JP JP2003560655A patent/JP2005515531A/en active Pending
- 2003-01-14 AU AU2003207958A patent/AU2003207958A1/en not_active Abandoned
-
2007
- 2007-12-10 US US12/000,139 patent/US20080091624A1/en not_active Abandoned
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US7328164B2 (en) | 2002-01-16 | 2008-02-05 | Earnix Ltd. | Pricing optimization apparatus and method |
Also Published As
Publication number | Publication date |
---|---|
US7328164B2 (en) | 2008-02-05 |
CA2471830A1 (en) | 2003-07-24 |
US20080091624A1 (en) | 2008-04-17 |
US20050033706A1 (en) | 2005-02-10 |
IL162690A0 (en) | 2005-11-20 |
JP2005515531A (en) | 2005-05-26 |
WO2003060625A3 (en) | 2004-04-29 |
AU2003207958A8 (en) | 2003-07-30 |
EP1466285A4 (en) | 2007-10-31 |
AU2003207958A1 (en) | 2003-07-30 |
EP1466285A2 (en) | 2004-10-13 |
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