E-commerce giants like Amazon have their own analytics division to help price their products just right and attract customers. Thanks to a startup called Boomerang Commerce, smaller e-commerce companies don’t have to bother about getting the price just right, all the time. Boomerang Commerce’s SaaS based solution will do the work for you.
Boomerang Commerce was started by Guru Hariharan, a Delhi Institute of Technology and Wharton alumnus. Headquartered in San Francisco and with a sizeable workforce in India, Boomerang Commerce uses price optimisation solutions to help retailers automatically and dynamically price products.
“We wanted to do something to bridge the gap between Amazon and the other guys. Amazon was crushing everyone when it came to pricing. So we thought, if we’re on the bottom of the pile, lets start looking at things and working from the top,” said Guru who is ex-Amazon and ex-EBay.
How Does Boomerang Commerce Work?
Companies plug-in the the Boomerang Commerce pricing engine onto their platforms using flat file integration or through the company’s API itself.
Boomerang Commerce uses its Dynamic Price Optimisation engine to help price according to strategy.
The companies can use the dynamic price optimiser to set goals. They can choose between just maximising margins or doing both – maximizing margins and revenues. This can be done both at a category and sub-category level.
Boomerang Commerce’s system uses A/B testing on various pricing strategies to help reach the output/target that an e-commerce company wants.
The analytics platform to help reach the target has two layers to it – competitor intelligence and profitability intelligence.
Competitor Intelligence – Boomerang Commerce uses a retailers catalog, factors in competitor’s pricing, and tracks how competition price competing products in almost real time.
Profitability Intelligence – Boomerang Commerce also factors in profitability levels by the unit for every online transaction by taking into account various variable costs including COGs, transport and logistics.
Thereafter, the dynamic price optimiser will use both the mechanisms to give the e-commerce company pricing at an SKU level.
Monetisation is on a subscription fee based on revenues obtained.
“Various companies that employ our platform have increased their sales by 5-20%. We have also doubled their margins,” said Guru. “While we have already created a price algorithm, in our next version we will allow companies to do game theory,” he adds.
Boomerang Commerce’s platform is currently available for use by e-commerce companies in the US, Europe and China.