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  • Levi Rosendall

The market is telling you how to price your product. You just need the right tools to listen.

The year was 2021. I had been running my e-commerce shop for several weeks, and my product was starting to pick up traction. Excitement was high as I packaged yellow believe signs (yes, from Ted Lasso) to ship them across the country. The excitement waned when I viewed my finances and realized that I was making 40 cents per item.

40 cents.

For all my efforts, I had set up my pricing so poorly I was hardly breaking even. I was left with no choice but to raise my prices. I was instantly filled with worry over how that would affect my demand. Wouldn’t selling 25 more at a margin of 40 cents be better than selling none at a higher margin?

Little did I know then that this challenge is present in companies as small as my Etsy shop all the way to huge Fortune 500 companies. In my role as a Data Scientist at a Fortune 500 company, it was my job to provide a solution to this challenge, to deliver a model to inform pricing action.

What was the outcome of that project?

  • A 50% increase in product sales.

  • A 30% increase in profit.

That success was possible because the market is telling you how to price your product, you just need the right tools to listen. I built an AI tool to show marketers how a change in their product price would affect sales quantity. This is possible because price has such a clear effect on sales, and there are years worth of research backing that up.

This is where Elastic comes in. The tool I created at a Fortune 500 company is now available on the Shopify App Store, ready to produce pricing insights for your company in less than 10 minutes. Elastic uses AI to make sense of the signals the market is sending your company, and couples that with your costs to give actionable pricing recommendations for your product.

Check it out here!

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