Companies are losing 300-500 basis points of gross margin despite revenue growth, as static pricing fails to keep pace with volatile costs and shifting customer value perception. Customer loyalty is at a historic low, with 60% of consumers switching brands due to cost, making uniform price hikes extremely risky and likely to trigger an exodus.
Maintaining the cost-plus status quo is not viable; it projects a further 200-300 basis point margin decline, ceding all pricing control to the market and competitors. The solution lies in a proactive framework using granular segmentation and behavioral economics to surgically adjust prices based on a customer's specific willingness to pay and loyalty profile—protecting high-loyalty customers with targeted offers while capturing margin from low-loyalty segments.