Metreo Touts Growing Demand for Price Optimization Solutions

Provider sees enterprises supporting pricing as a strategic corporate initiative; analysts point to bottom-line benefits

Provider sees enterprises supporting pricing as a strategic corporate initiative; analysts point to bottom-line benefits

Palo Alto, CA — January 19, 2004 — Metreo, a provider of price optimization software solutions, is touting its recent customer wins and pointing to what it sees as a trend in enterprises moving to support pricing as a strategic initiative.

The provider said its solutions are now deployed in business environments ranging from $100 million to $6 billion in revenue, with the company's customers including such industrial component manufacturers as Eaton Corp., Essex Electrical Products and Honeywell Aerospace.

These companies use Metreo's price execution, analysis and planning solution to help ensure better pricing decisions and disciplined execution. Top executives at these and other enterprises are supporting pricing as a strategic corporate initiative, Metreo said, and are using price optimization solutions in order to derive the best price within the quote-to-order process.

"Metreo's solution allows us to see how profitable each deal is," said Ray Huber, chief information officer at Eaton/Cutler-Hammer. "With this information, we will be able to make better decisions as we evaluate the potential impact of each request, ultimately allowing us to better serve our customers."

According to Alice Greene, industry analyst at technology consulting firm Industry Directions: "Price optimization can deliver large revenue gains but many companies lack the data on sales and price history to use it. Fortunately, just bringing all pricing data and rules together into a single platform to enforce them can deliver immediate benefits in revenue and customer satisfaction. Helping sales rapidly create quotes and negotiate within profitable guidelines can boost revenues per quote, and improve the win ratio."

Metreo said that a key driver for the adoption of price optimization solutions is that pricing is becoming far more complex as industrial component manufacturers continue their efforts to deliver quality components to customers at a fair yet profitable price.

Analysts seem to agree that this type of solution can have a positive impact on a company's bottom line. According to industry analyst Kevin Scott of AMR Research, "Companies that have put a strategic focus on how prices are set, negotiated and managed have seen up to 10 percent in incremental revenue. Clearly, the price optimization space is rapidly gaining acceptance and adoption due to its demonstrable return on investment and direct impact to a company's bottom line."

"In today's tough economic climate, companies are more aware than ever of the need to optimize their entire pricing process in order to meet corporate business objectives, impact profits and improve market responsiveness that leads to long-term profitable customer relationships," said Daphne Carmeli, CEO of Metreo.

For more information on price optimization solutions from both the buy- and sell-side perspectives, see the two-part series "Finding the 'Right' Price" in the July 2001 (sell-side) and August 2001 (buy-side) issues of iSource Business (now Supply & Demand Chain Executive) magazine.

For more information on how Essex Electrical Products plans to use the Metreo solution in its pricing process, see the article "Improving Pricing Practices at Essex Electrical" (January 12, 2004).