Are bad promotions hurting you Discover why revenue growth management is the ultimate pricing secret.
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Key Moments
Eliminate Wasteful Promotions
McKinsey reports 59% of promotional spend fails to generate extra sales, showing the cost of ineffective discounts.Data-Driven Pricing Decisions
Revenue Growth Management replaces guesswork with analytics, helping companies understand customer price limits and improve profit margins.Channel-Specific Price Optimization
Different retail channels justify varied wholesale prices, allowing firms to capture more value across gas stations and supermarkets.Shelf Space & Assortment Optimization
Analyzing profitability helps retailers replace low‑performing items with higher‑margin products, simplifying choices and boosting sales.Retail businesses may sell millions of products each year, but higher sales do not always guarantee greater profits. Revenue Growth Management helps companies look beyond sales volume by carefully analyzing pricing and other revenue decisions. By applying Revenue Growth Management, businesses can make more informed choices about how to protect profit margins and support sustainable growth.
How Brands Fix Bad Discounts with Revenue Growth Management
Retailers often offer discounts to attract shoppers. For example, a supermarket might issue a coupon for soap, encouraging customers to buy it at a lower price. But if the discount does not lead to additional sales, it can reduce the company’s profits.
Revenue Growth Management helps businesses identify promotions that are not delivering results. McKinsey reports that consumer goods companies waste 59% of their promotional spending on discounts that fail to generate extra sales. By reviewing how each offer performs, managers can stop ineffective promotions and protect profit margins.
Shoppers want affordable products, but rising material costs can make that difficult for manufacturers. If raw potato prices increase, a snack company can use Revenue Growth Management to review its costs and packaging.
One option is to make the bag slightly smaller while keeping the price the same. This can help protect profit margins, but the company should be transparent about the change to maintain customer trust.
The same bottle of water can have different prices depending on where it is sold. A customer might pay $3 at a gas station but only $1 at a supermarket. Revenue Growth Management helps companies account for these differences across retail channels.
For example, a beverage company might charge gas stations a higher wholesale price and supermarkets a lower one, reflecting how customers shop in each setting. This approach helps the company tailor its pricing across different retailers.
Setting prices by guesswork can lead to costly mistakes. Revenue Growth Management uses data and pricing tools to help businesses understand what customers are willing to pay.
NielsenIQ research suggests that carefully assessing customers’ price limits can improve operating profit by 5%. Bain & Company also reports that retailers using advanced pricing software can increase revenue by 8% within a year compared with those relying on manual spreadsheets. These tools help managers make more informed pricing decisions and adjust prices in ways customers are more likely to accept.
A soap manufacturer may sell both a premium blue soap and a lower-priced green one. If the company cuts the green soap’s price too sharply, customers may switch from the blue soap rather than buy an additional product. This is a form of internal sales competition.
Revenue Growth Management helps businesses understand how pricing changes affect sales across their product range. By analyzing the relationship between the two soaps, managers can avoid unnecessary price cuts and set prices that support both products.
Effective Revenue Growth Management also relies on understanding how price changes affect customer demand and whether promotions are truly worthwhile. Instead of relying only on past averages or guesswork, businesses can use pricing models and analytics to estimate how shoppers may respond to different discounts.
These insights can help companies avoid promotions that reduce profits without generating enough additional sales, choose more effective discount levels, and protect their margins.
Retail stores have limited shelf space, and offering too many shampoo options can overwhelm shoppers. When customers struggle to choose, they may leave without buying anything.
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Revenue Growth Management helps retailers identify which products are most profitable. A store manager might use this analysis to replace 20 less profitable shampoos with 30 stronger-performing options, making the selection easier for shoppers while using shelf space more effectively.
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–Written by Rajnish Kumar, a copywriter and strategist with a background in fast-paced journalism, who explores the gap between what brands promise and how consumers actually behave.
