Why Pricing Evolution Demands a Holistic Approach

Why pricing should be viewed as a strategic imperative, not just a tool

Ask 10 retailers how they think about pricing and you'll get 10 different answers ... and probably 10 different ways to approach it.

Some will tell you it's an IT project. Find the right software, get it deployed, and the pricing will sort itself out. Others will tell you it's fundamentally a strategic exercise — something you need to spend six months with a consultancy working through before you even think about technology. And frankly, some — beyond the category manager making decisions on a spreadsheet — haven't thought about it much at all.

Here's what I've learned after more than two decades working with retailers on pricing across Europe: all of those approaches tend to end with the same result — a lot of time and money spent, and pricing that still isn't where it needs to be.

The retailers that genuinely move the needle on pricing are the ones that treat it as what it actually is: a combination of strategy, technology, people, and process — all of which need to evolve together.

The Dangers of a One-Sided Mindset

The tool-first trap

I've worked with organisations where the pricing transformation became, effectively, an IT project. The business case gets built around technology investment because AI is on the agenda, the budget is there, and someone has concluded (rightly so) that pricing is where the best return lies. So, IT goes out and acquires a pricing solution.

The problem is that none of this has involved the business. There's no strategic buy-in, no consideration of what processes will need to change, and no real understanding of what "better pricing" even means for that organisation. The tool arrives, gets configured to replicate the existing way of doing things (as close as it can), and the expected transformation never materialises. The technology at best ends up being an expensive way to do the same thing slightly faster and at worst never gets adopted.

The strategy-first trap

On the other hand, I've seen businesses spend the better part of a year with a big-name consultancy producing a comprehensive pricing strategy. While it's beautifully structured and thoroughly researched, when they go looking for a tool to implement, it quickly becomes apparent that no tool works quite the way the strategy envisaged.

So either the strategy gets redesigned, the organisation gets restructured, and new processes get built, or the tool doesn’t produce the desired results. At the end of it all, they've invested a considerable amount and effectively repeated all the hard work simply because reality intervened.

What Goes Right When You Bring Both Together

The best pricing transformations I've been involved in are the ones where strategy, technology, organisation, and process are treated as parallel workstreams from day one, with the clear understanding that all of them will change and adapt as the work progresses.

This approach unlocks something really important: the ability to test strategic assumptions against real data and real tool capabilities, rather than designing a strategy in the abstract and hoping something will deliver it. If you're changing your competitive positioning, what does that actually mean for margin? If you adjust your promotional architecture, what does elasticity modelling tell you about the trade-offs? Good analytics and pricing tools can help answer those questions — but only when they're part of the strategic conversation, not a follow-on activity.

From Silo to Synergy: How to Make It Work

So how do organisations actually get there? In my experience, it comes down to a few things.

1. It has to start with senior-level sponsorship

Pricing transformation needs a clear mandate from an executive or senior leadership who says: We are going to improve the way we do pricing, and we are going to look at this end to end.

And the mandate matters. There's a meaningful difference between "find us a better pricing solution" and "find us a better way of doing pricing." The focus has to be on getting better prices and better commercial outcomes, not just process efficiency. If efficiency is the only goal, you tend to get exactly that and nothing more.

2. Be willing to change how you operate

Perhaps the most underrated ingredient is genuine openness to doing things differently. The organisations that struggle most tend to be those that expect the tool to fit entirely around their existing processes. In reality, meaningful transformation almost always requires movement on both sides. The solution needs to fit the business — but the business also needs to be open to evolving.

The question to ask any vendor isn't just "Can your solution do what we need?" It's "How will working with you help us deliver better value through pricing than we do today?"

3. Build a cross-functional team with genuine capacity to lead

You don't need a large team, but you do need the right people: people who can be agents for change and who can look holistically and collaborate cross-functionally. That includes pricing people, of course, but also IT, operations, and commercials. You need someone who understands and will champion the business objectives, and someone who understands organisational processes.

And critically, the initiative needs to be structured from the start around parallel workstreams: strategy, tools, and organisational change running alongside each other, not handed off sequentially.

Choosing a Partner Built for Where You're Going, Not Just Where You Are

When evaluating tools, flexibility matters more than people often realise. At the point of selection, most organisations don't fully know what capabilities they'll need further down the line. You're not trying to replicate what you do today. You're trying to do something better.

A solution that covers your needs as they currently stand may well fall short as your ambitions evolve. Choose a partner with the breadth and depth to accommodate where you're heading, not just where you are now.

But capability isn't the whole story. The people behind the solution matter just as much. A vendor's team needs to understand your commercial challenges, be able to explain the why behind their recommendations, and genuinely guide you through the change that a pricing transformation demands. In my experience, clients aren't just buying technology — they're buying expertise and partnership. A strong solution in the hands of a team that can't articulate how to get value from it is a real risk.

Experience across different geographies and retail formats counts for a great deal too. A discounter in Central Europe is not the same as a premium grocer in the UK, which is not the same as a multi-format retailer in Scandinavia. Working with a partner that has navigated that kind of diversity without assuming they already know the answer when they walk in the door is a genuine advantage.

Conclusion: The Path to Pricing Excellence

A holistic approach to pricing isn't a project you complete; it's a capability you build and continuously refine. Strategy, tools, organisation, and processes don't get aligned once and then stay that way. The retailers that do this well revisit all of them regularly, using each to inform the others.

What I've consistently seen is that success isn't determined by budget or starting point. It's determined by mindset. It takes a genuine commitment to looking at the full picture from the very beginning — and resisting the temptation to treat strategy, technology, and organisational change as separate activities.

If you're starting that journey, the most important decision is also the first one: approach it holistically, from the top, with intent.

Want to go deeper on what to look for when evaluating a price optimisation solution and vendor? Read our guide here for the capabilities, questions, and criteria that matter most.