Popken Fashion Group has been optimising its online prices with GK Air, the cloud-based AI solution for dynamic pricing, for two years – with noticeable success: the family business specialising in plus-size fashion has not only increased its margin, but has also been able to reduce the manual effort required for price adjustments during end-of-season sales by around seventy per cent. At the EHI TechDays in Bonn, Natascha Vry, expert for dynamic pricing and catalogue management at Popken Fashion, showed how the fashion retailer masters the complexity of its international business with AI-controlled pricing.
The pricing manager reported in Bonn that Popken Fashion now largely relies on algorithm-supported pricing decisions. GK Air’s AI automatically recalculates prices three times a week – totalling 3,500 price changes per week – and rolls them out to all systems overnight. “We control the sales prices for around 50,000 items worldwide in 30 online shops and eleven marketplaces – this was simply no longer manageable manually,” said Natascha Vry. The aim was to reduce the high manual effort and to consistently make data-based pricing decisions.
In her presentation, Natascha Vry emphasised that the introduction of dynamic pricing at Popken Fashion was far more than just an IT project – it marked a strategic change: “We used to work with a mix of gut feeling and Excel – today, the AI-based solution from GK Air controls our pricing,” said the manager.
Proven effects on margins and processes
The dynamic pricing expert at Popken Fashion continues: “With GK Air, we reduce the manual effort involved in end-of-season sales by up to 70 per cent. The tool allows us to simulate scenarios, manage prices according to life cycles and seasons and implement adjustments immediately.”
GK Air’s dynamic pricing takes into account demand and stock levels as well as price limits, rounding rules and different currency areas – slow sellers are reduced at an early stage to prevent excessive reductions at the end of the season and secure margins.
Dynamic pricing increases margins
Popken Fashion uses the capacities gained to optimise pricing strategies. Instead of routine work, the teams now carry out tests, analyses and segmentation in order to efficiently manage the entire pool of articles. The clothing specialist currently uses GK Air for around 70 per cent of its pricing processes – according to Natascha Vry, this figure is set to rise to 90 per cent by the end of next year.
Popken Fashion currently uses dynamic price control for its online shops. GK Air provides the clothing retailer with the technical basis for consistently controlling prices in brick-and-mortar stores across all channels in the future. According to Natascha Vry, the next step is already being planned: “The tool can also utilise retail prices – we have deliberately kept this open. We want to connect brick-and-mortar stores in the future.”
Basis for cross-channel prices
Employees in the brick-and-mortar Popken stores currently automatically issue the lower online price. Natascha Vry explains: “If customers see an item cheaper online, they will also receive this price in the store – this is how we ensure customer satisfaction.”
