March 24, 2019

Price per Item / Units per Order

There's a relationship, as you already know, between how much an average item costs and how many units per order you generate as a consequence.


You have the data to measure the relationship. Use data by merchandise category, measure the change in price (i.e. 5.0 is a 5% increase in chance in price) year-over-year and the change in units per order (year-over-year).

Once you have the relationship, you can determine what the "optimal" price point is, or at least determine the impact of raising (or lowering) prices.

You do this stuff, right?

You have different merchandise categories - for each, measure year-over-year change in units per order and price per item purchased. Simple! Plot the result. Fit a line. Done.


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