How An FMCG Brand Achieved 7% Higher Margins And 2x Customer Loyalty with Tracedata's Pricing Analysis

Client Background

A well-established FMCG brand operating across multiple personal care and household categories in India. The client had strong distribution in urban markets and growing traction in Tier 2 cities. Despite premium packaging and product quality, pricing inconsistencies across SKUs were undermining both profitability and customer loyalty.

Challenges They Faced

Despite high brand recall, the client faced following challenges:
• Chronic discounting pressure, especially during monthly and festival sales cycles

• Eroding contribution margins, with up to 18% margin dip in their top-selling SKU over 12 months

• Price confusion across retail and e-commerce channels, leading to customer churn

• Premium SKUs were often clubbed with mass-market items, diluting perceived value
• The internal pricing strategy lacked a clear framework, and most decisions were reactive to competitor moves.

Our Approach

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TraceData Research adopted a multi-layered pricing optimization strategy that balanced revenue goals with consumer psychology:

1. Elasticity Mapping Across Portfolio: Analyzed two years of SKU-level sales and promo data across 50+ products. Identified 16 SKUs where price changes had negligible impact on volume, giving room for profitable repositioning.

2. Value-Based Repricing: Moved away from cost-plus pricing. We assessed customer willingness to pay by segment, occasion, and brand perception, repositioning 12 SKUs to reflect actual value delivered rather than competitive undercutting.

3. Price Laddering Architecture: Designed a clear good-better-best pricing structure. This aligned price points with product benefits, improving consumer navigation and upsell opportunities, especially in high-margin premium segments.

4. Promotion Guardrails & Channel Controls: Standardized base pricing across 3 major modern trade partners and 4 e-commerce platforms. Introduced thresholds for promotions to curb excessive discounting while preserving retailer support.

5. Rapid Testing & Feedback Loops: Piloted new price bands in two metro cities and tracked weekly sell-through. Iterative adjustments improved promo ROI by 18% and reduced margin dilution from short-term offers.
This was a shift from reactive discounting to proactive price management, anchored in data, brand equity, and behavioural economics.

Outcome

The implementation of TraceData Research's pricing strategy delivered tangible results both financially and perceptually. By rebalancing price points with customer value and market dynamics, the brand was able to protect margins without compromising growth or retention.

The key outcomes were:

• By eliminating unnecessary discounting and repositioning value-rich SKUs, the brand saw a 7% increase in per-unit earnings over a 3-month period.

• Products in the "better" and "best" tiers contributed significantly more to profitability, while low-margin SKUs were either repositioned or deprioritized.

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• Frequency and depth of promotions dropped by 35%, particularly across modern trade channels.

• Post-implementation surveys revealed a 22% increase in consumers associating the brand with "premium" and "value for money".

• High-value customers, especially in urban and e-commerce channels, showed a 12% increase in repeat purchase rate within the premium SKU band.

Client Testimonial

"Working with TraceData Research was a turning point for us. We had been stuck in a cycle of promotions, always chasing volume at the cost of margins. Their pricing expertise helped us see our portfolio through the lens of customer value rather than just cost. The outcome speaks for itself: better revenue, healthier margins, and a stronger brand position."

- Head of Strategy, Leading FMCG Brand

Contact Us: -
TraceData Research
sales@tracedataresearch.com
+91 9266849840

TraceData Research is a full-stack market research company founded by research professionals with over 15 years of industry experience. The company is recognized for its proprietary methodologies, deep consumer understanding, high-quality research, and entrepreneurial mindset.

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This release was published on openPR.