A-Z Popular Blog Pricing Search »
Related Guides

4 Types of Price Optimization

 , updated on
Price optimization is the use of formal methods to discover pricing structures that optimize a goal such as revenue or customer acquisition targets. The term suggests the use of measurement and analysis as opposed to relying solely on sticky prices or a long term strategy such as premium pricing. The following are common types of price optimization.


Experimenting with a variety of prices and price structures using techniques such as a/b testing. This is particularly common in industries such as ecommerce where it is easy to change prices on the fly.


Using analytics tools to find patterns in historical data. For example, a fashion retailer might discover that their data indicates men in their twenties are price incentive to shoes under $100 but demand quickly drops after this price point.


Advanced entities such as nations or banks may model the prices of things such as commodities based on economic models that consider supply and demand curves and other factors.

Yield Management

Yield management is the practice of optimizing price at the level of an individual transaction. For example, airlines may attempt to optimize price for every seat in their inventory.
Overview: Price Optimization
The use of formal methods to discover optimal pricing structures.
Related Concepts


This is the complete list of articles we have written about pricing.
Algorithmic Pricing
Bargaining Power
Benchmark Price
Price Fixing
Cost-plus Pricing
Price Gouging
Customary Pricing
Decoy Effect
Everyday Low Price
Marginal Utility
Willingness To Pay
Dynamic Pricing
High-Low Pricing
Market Value
Flat Pricing
Loss Leader
Predatory Pricing
Price Discrimination
Snob Effect
Market Price
Price Competition
Price Leadership
Premium Pricing
Price Economics
Price War
Revenue Management
Veblen Goods
Price Floor
Price Promotion
Price Sensitivity
Price Skimming
Price Umbrella
Pricing Power
Pricing Strategy
Sticky Prices
Value For Money
More ...
If you enjoyed this page, please consider bookmarking Simplicable.


The common types of pricing.

Pricing Examples

An overview of common pricing strategies.

Pricing Strategy

An overview of common pricing strategies.

Sales Promotion

The common types of sales promotion.

Flat Pricing

A definition of flat pricing with examples.

Revenue Management

The definition of revenue management with examples.

Dynamic Pricing

The common types of dynamic pricing.

Pricing Objectives

The common types of price objective.

Benchmark Price

A definition of benchmark price with examples.

Price Escalation

The two common meanings of the term price escalation.

Price Economics

A list of price economics principles and theories.

Willingness To Pay

A list of factors that influence willingness to pay.

Sticky Prices

Prices that stick to an established range and resist changing economic forces such as inflation.


A definition of commoditization with examples.

Too Cheap To Meter

A definition of too cheap to meter with examples.

Relative Price

The definition of relative price with examples.


An overview of dumping with an example.

Value vs Price

The difference between value and price with examples.

Market Value

The definition of market value with examples.

Competitive Market

A complete overview of competitive markets with examples.
The most popular articles on Simplicable in the past day.

New Articles

Recent posts or updates on Simplicable.
Site Map