AI Pricing Optimization in FMCG

Introduction

In the highly competitive FMCG (Fast Moving Consumer Goods) sector, especially in markets like beverages, pricing can make or break profitability. Yet many companies still rely on traditional cost-plus pricing, missing opportunities to align prices with real customer behavior and market value.

Enter Tilect. Using advanced AI and optimization algorithms, Tilect enables FMCG businesses to shift toward value-based pricing, unlocking hidden profits while preserving sales volume.

The Challenge

FMCG companies with complex product portfolios and multiple sales channels face recurring challenges:

FMCG companies often struggle with:

• Limited visibility into how price affects demand

• Static pricing strategies that don’t reflect changing market dynamics

• Pressure to maintain volume while increasing margins

• Thousands of SKUs, making pricing decisions complex and risky

The key question: Which products can we reprice to increase profit, without losing sales?

The Solution

Tilect deployed a two-part solution:

1. Elasticity-Driven Price Intelligence

2. Mathematical Price Optimizers

(1) Tilect’s AI models analyzed price elasticity of demand across all SKUs, identifying:

• Which SKUs are price-sensitive

• Which products could handle a price increase without affecting volume

• Optimal price ranges tailored to real consumer behaviour

This allows companies to move from cost-plus pricing to value-based pricing, pricing products at what customers are willing to pay.

(2) Once elasticity was known, Tilect applied optimization algorithms to simulate different pricing strategies:

• Maximize profit

• Maximize volume

• Find a balance between the two (profit & margin)

The optimizer generated a full pricing strategy across SKUs, ensuring the business goal was achieved at scale.

Results

After implementing Tilect’s pricing recommendations, the company achieved:

• +132,000€ in projected annual profit uplift

• No significant drop in volume (-0.5%), even with price increases on selected SKUs

• Data-driven control over pricing decisions across the entire catalog of SKUs

With proven impact, like the +132k €/year identified in this case, Tilect is a strategic partner for companies ready to modernize their pricing strategy.

Keywords: FMCG pricing optimization, AI pricing strategy, price elasticity FMCG, value-based pricing, cost-plus vs value pricing, pricing analytics, price optimization tool, SKU-level pricing, Tilect AI, pricing for profit and volume

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