Rule relaxation and subset optimization system

• US 7,809,581 B1
• Filed: 11/30/2001
• Issued: 10/05/2010
• Est. Priority Date: 11/30/2001
• Status: Expired due to Fees

• Current Assignee: International Business Machines Corporation
• Original Assignee: DemandTec Inc. (International Business Machines Corporation)
• Inventors: Venkatraman, Krishna, Lee, Hau, Delurgio, Phil, Parkin, Rob, Neal, Michael, Valentine, Suzanne
• Primary Examiner(s): RUHL, DENNIS WILLIAM
• Application Number:
  US10/007,002
• Time in Patent Office: 3,231 Days
• Field of Search: 705/1, 705/7, 705/10, 705/400
• US Class Current: 705/1.1
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 30/0283 Price estimation or determination

Abstract

A method for computing a preferred set of prices for products in a subset of a plurality of products is provided. Generally, initial prices for a plurality of products are stored. A subset of products of the plurality of products is designated, where the number of products in the subset of products is less than the number of products in the plurality of products. Prices for the products in the subset of products are optimized, while maintaining the initial prices of products of the plurality of products that are not in the subset of products.

Claims

1. In a computer system, a method for computing a preferred set of prices for a subset of products of a plurality of products, comprising:

setting, using the computer system, a plurality of relaxable rules, wherein the setting of rules utilizes rule parameters, and wherein the rule parameters include default rule parameters and configured rule parameters;

prioritizing, using the computer system, the plurality of relaxable rules;

identifying, using the computer system, at least one lower priority infeasible rule from the plurality of relaxable rules;

incrementally relaxing, using the computer system, any infeasible rule of the plurality of rules which has a lower priority than the at least one lower priority infeasible rule to allow the at least one lower priority infeasible rule of the plurality of rules to become feasible;

storing, using the computer system, initial prices for a plurality of products;

designating, using the computer system, a subset of products of the plurality of products, wherein the number of products in the subset of products is less than the number of products in the plurality of products; and

optimizing, using the computer system, prices for products in the subset of products, while maintaining the initial prices of products of the plurality of products that are not in the subset of products, and wherein the optimizing of prices complies with the relaxed any infeasible rule of the plurality of rules.

2. The method, as recited in claim 1, wherein the designating a subset comprises:

allowing a number N to be designated; and

selecting no more than N products of the plurality of products to form the subset of products, wherein the selecting no more than N products has the largest impact on the optimizing of prices of any subset of no more than N products of the plurality of products, and further wherein the largest impact on the optimization is determined by ranking all products by a marginal contribution to the optimization and selecting the no more than N products by a mixed integer problem.

3. The method, as recited in claim 2, further comprising providing, using the computer system, an optimization of at least one of total profit, sales volume, and revenue for the subset of products.

4. The method, as recited in claim 1, further comprising providing, using the computer system, initial prices by optimizing prices for all of the plurality of products.

5. The method, as recited in claim 4, further comprising providing, using the computer system, new data subsequent to providing initial prices by optimizing prices.

6. The method, as recited in claim 5, wherein the new data comprises new price data and new price bound data, and wherein new price bound data includes changes in costs, base price, competitive prices, point-of-sale data, product information and store information.

7. The method, as recited in claim 2, further comprising providing, using the computer system, an optimization of total revenue for the subset of products.

8. The method, as recited in claim 2, further comprising providing, using the computer system, an optimization of sales volume for at least one product of the subset of products.

9. The method, as recited in claim 1, wherein the rule parameters includes at least one of group price change, brand pricing rules, size pricing rules, unit pricing rules, line pricing rules, cluster pricing rules, gross margin rule, store volume rule and competition rules.

10. A computer implemented, price optimization system for optimizing a preferred set of process for a subset of a plurality of products, comprising:

a rule editor configured to set a plurality of relaxable rules, wherein the plurality of relaxable rules is set utilizing rule parameters, wherein the rule editor utilized default values of the rule parameters, and further wherein the rule editor enables configuring of the rule parameters by a user;

a rule prioritizer configured to receive a prioritization of the plurality of relaxable rules, and for identifying at least one lower priority infeasible rule from the plurality of relaxable rules;

a rule relaxation module configured to incrementally relax any infeasible rule of the plurality of relaxable rules which has a lower priority than the at least one lower priority infeasible rule, enabling the at least one lower priority infeasible rule to become feasible;

a database configured to store initial prices for a plurality of products;

a product designator configured to designate a subset of products of the plurality of products, wherein the number of products in the subset of products is less than the number of products in the plurality of products; and

an optimization engine configured to optimize prices for products in the subset of products, while maintaining the initial prices of all other products of the plurality of products and wherein the optimizing of prices complies with the relaxed any infeasible rule of the plurality of rules.

11. The price optimization system, as recited in claim 10, wherein the product designator for designating a subset enables a number N to be designated, and wherein the product designator selects no more than N products of the plurality of products to form the subset of products, and wherein the selected no more than N products has the largest impact on the optimization of prices of any subset of no more than N products of the plurality of products, and further wherein the largest impact on the optimization is determined by ranking all products by a marginal contribution to the optimization and selecting the no more than N products by a mixed integer problem.

12. The price optimization system, as recited in claim 11, wherein the optimization engine provides an optimization of at least one of total profit, sales volume, and revenue for the subset of products.

13. The price optimization system, as recited in claim 12, wherein the optimization engine provides initial prices by optimizing prices for all of the plurality of products.

14. The price optimization system, as recited in claim 10, wherein the optimization engine provides initial prices by optimizing prices for all of the plurality of products.

15. The price optimization system, as recited in claim 10, wherein the optimization engine provides an optimization of total revenue for the subset of products.

16. The price optimization system, as recited in claim 10, wherein the optimization engine provides an optimization of sales volume for at least one product of the subset of products.

17. The price optimization system, as recited in claim 10, wherein the rule editor enables configuration of at least one of group price change, brand pricing rules, size pricing rules, unit pricing rules, line pricing rules, cluster pricing rules, gross margin rule, store volume rule and competition rules.