While revenue management is familiar and widely practiced by many companies, when business leaders are tasked with designing and implementing a new strategy in practice, we consistently encounter the need to apply numerous changes, tweaks, adjustments and lessons that aren’t covered by standard “textbooks”. This experience spurred us to start writing in an attempt to consolidate the new knowledge we’d accumulated over time. But we failed – miserably.

Initially planning to launch in three months’ time, it would take three years to arrive at the present report, with the involvement of ten different leaders and input from many additional revenue management projects executed together with CPG companies across a broad range of portfolios, geographies and commercial models. The challenge lay in logically synthesizing these lessons, trials & errors and best practices for design and implementation in a structured way to support our clients.

Despite the time it has taken, the insights presented here are far from outdated. On the contrary, in today’s market context, they are more relevant than ever – with the benefit of having gone through countless rounds of refinement and reflection in the hands of experienced professionals who invested a great deal of care and attention.
This exercise led us to identify a number of key success factors:

1. Having clear and aligned goals for the revenue management strategy as well as clarity regarding possible trade-offs
2. Understanding the business context and reality in which these goals will be pursued
3. Guaranteeing sponsorship from the leadership and internal stakeholders while respecting cultural aspects
4. Considering the non-technical elements that are indispensable for effective strategy design and implementation
5. Defining the implementation premises from the beginning considering trade-offs between speed and risk
6. Establishing a governance model for staying on track and adjusting

Our aim in this report was to move beyond a theoretical, textbook understanding of designing and implementing revenue management strategies. One of the key takeaways from our discussion is that serious and profound consideration of your business’ given reality as well as the individual human beings who collectively bring the business to life are just as important as the technical elements of the strategy.

The design of any revenue management strategy should always take these elements into account with regard to the 1) business context, 2) the company’s internal stakeholders, 3) external supply chain dynamics and 4) the right sell-in/sell-out mindset.

And that’s only half the battle: Success also rests on a well-designed implementation strategy along with a plan for executing it – a point where many consultancy textbooks stop. Implementation needs to go beyond a one-off strategy rollout and recognize that pricing is a living organism in constant flux. Long-term success and viability rely on having the right governance, rituals, processes and systems in place that allow your organization to quickly react to changes in the market and ensure that the strategy is being implemented correctly.

Taken together, this will pave the way for your business to enjoy a lucrative revenue road ahead that delivers long-term results.