Pricing

Unlike other components of a business where customer feedback is relatively straightforward to gather, it is difficult to know precisely if prices are set too high or too low and by how much.

Without rigorous empirical strategies, it is impossible to know whether a different pricing strategy would in fact be better. We have found most pricing decisions by even the very best firms are essentially heuristic—based on rules of thumb and past practice—and are far from optimal.

TGG takes a different approach to this classic economics problem. In additional to traditional econometric tools, TGG looks for natural experiments and uses test-and-control experimentation to produce precise recommendations on pricing. In diverse contexts such as retail apparel and warranties for electronics, these methods have helped firms optimize their pricing and increase profits.


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