Configure Competition Based Pricing Strategy

Owned by Ondřej Tesař
Sept 30, 2024
3 min read

This article explains how to set up Competition Based Pricing Strategy in Price Setting accelerator using the out-of-the-box features.

Prerequisites

Before you start, ensure you know the following:

  • What part of the business will be priced by this strategy:

    • Pricing Levels

    • Product Segments

  • Storage and structure of the Competition data table:

    • Competitor prices data must be stored in a table supported by the Price Setting accelerator – in this case in the Competition Data table in Master Data.

    • Find out if you have different Competition records for different Pricing Levels’ attributes (e.g. per Pricing/Dependency Level name, dimension, preference1, …)

      • Find out which field of the Competition Data table stores the Pricing Level attribute (it could be, for example, the “country” field).

Example of Competition Data table with different data per Pricing/Dependency Level names stored in the field Country.

Review Data

  1. Review the Competition Data table to know the field names and labels, and to know what data are in this table.

  2. Review the Company Parameters with names ending with “StrategySelection”. For new projects you will see several out-of-the-box tables to help you start, and in existing projects you will see how the project was managed until now.

  3. Review the Company Parameters with names ending with “CompetitionAdditionalConfig”. For new projects you will see several out-of-the-box tables to help you start. In existing projects, however, they may have different names, so you need to review the field Additional Engine Configuration in Company Parameter table StrategyDefinition, to know which tables are used.

Configure Product Competition Module

Enable Product Competition Module

  1. Navigate to Company Processes > Price Setting Accelerator Configuration Wizard, select the Product Competition Module, and click Configure.

  2. Turn the module ON and click Update Module Status.

Set up Dependency Mapping for Competition Data Table

  1. Navigate to Company Processes > Price Setting Accelerator Configuration Wizard, select the Product Competition Module, and click Configure.

  2. Click Configure Dependency Mapping.

  3. If your Competition Data are NOT different per Pricing Level, then select None, and click Apply.

  4. If your Competition Data are different per Pricing Level, set the mapping by Lookup, and then select the mapping between 2 fields – field of the Pricing/Dependency Level (e.g. Name, Dimension, Preference1, etc.) and the field in your Competition Data table (e.g. country, additionalInfo3, etc.). Save the setup by clicking Apply.

Configure Strategy

  1. Review the article Configure Pricing Strategy for Pricing Level and Product Segment.

  2. Add/modify records in that “*StrategySelection” table for a specific combination of the ProductSegment, for which you want to use Competition Based pricing strategy.

  3. Select the MinCompetition, MaxCompetition or AvgCompetition strategy for specific Product Segment combination or on “star” level.

  4. Set up the proper priority of your pricing strategy – as first, second, etc. for the Product Segment.

Adjust Setting of Competition Additional Config

The strategies MinCompetition, MaxCompetition and AvgCompetition come with additional configuration out-of-the-box which you may modify.

Remember that if you modify the default additional configuration, it will apply to each product segment which will be calculated by that strategy.

So if you need special additional setting for your competition strategy (in the StrategyDefinition company parameter), create a new strategy and make another additional config table for it.

The out-of-the-box setup for those strategies is stored in Company Parameters MinCompetitionAdditionalConfig, AvgCompetitionAdditionalConfig and MaxCompetitionAdditionalConfig.

Example of out-of-the-box AvgCompetitionAdditionalConfig setup.

Verify

  1. Recalculate the price list/grid, and verify that the strategy is used for products from the Product Segment.

  2. Review the fields Competition Data and Price Selector for any errors.