Harnessing the Power of Causality for Price Optimization with Gleb Romanyuk

Gleb Romanyuk is a Principal Economist at Wayfair. He leverages his Ph.D. in Economics and his extensive experience in the tech industry to develop cutting-edge solutions for competitive pricing and economic analysis. In this episode, Gleb emphasizes the underutilization of data by most companies. He recommends harnessing its power to gain insights into business performance and develop optimized pricing strategies.   Why you have to check out today’s podcast: Understand an economist's role in analyzing data and optimizing pricing Learn to note the distinction between forecasting and prediction versus the causal inference Test price elasticity with causality   “I would encourage people to take advantage of their sales data when looking into setting prices. If you don’t have it then start recording it.” - Gleb Romanyuk   Topics Covered: 01:56 - How he got introduced into pricing 03:46 - What is an economist's role in a company 06:04 - Distinguishing forecasting versus prediction 09:23 - Proving causality even with just observational data 15:06 - Case in point: does faster shipping improves revenue and profitability [how to go about the test and the variables used] 18:31 - What he thinks of the fact that most companies don't know how to use the data they gather 19:41 - Talking about more job opportunities for economists 20:49 - Highlighting a fascinating finding on using value pricing 23:16 - Sharing his insights on Mark's comment of not favoring taking into account price elasticity for pricing 24:46 - Gleb's impactful pricing advice   Key Takeaways: "You can learn a lot about the performance of your business [by taking advantage of your sales data] and do better than just pricing by the market or pricing by the cost." - Gleb Romanyuk "Can we measure the long-term elasticity that takes into account the competitor's response? Usually we can't really get at it because it involves strategic interactions. I think what we do about it is we take market price into account. But also it's important to understand to which extent your products are differentiated from the competitors and how fierce the competition is." - Gleb Romanyuk   People / Resources Mentioned: Wayfair: https://www.wayfair.com/ Amazon: https://www.amazon.com/   Connect with Gleb Romanyuk: LinkedIn: https://www.linkedin.com/in/glebromanyuk/ Email: gleb.romanyuk@gmail.com   Connect with Mark Stiving: LinkedIn: https://www.linkedin.com/in/stiving/ Email: mark@impactpricing.com