DECIPHER™ Case Study 02:
Boeing
Price Optimization
Synopsis
Boeing engaged Competitive Analytics to generate four custom analyses for a multi-family for-sale condominium project in Southern California: 1) Predictive analytics model for both supply and demand of apartment units, 2) Price optimization modeling, 3) Product segmentation analysis and modeling, and 4) Consumer demand analytics utilizing demographic and psychographic modeling. Competitive Analytics’ advanced analytics identified opportunities to maxima´revenue by $78m.
Background
Boeing is a Fortune 30 company. The Boeing Company provides the company’s business units and Corporate Offices with innovative and effective common services that support the competitive design and manufacture of aerospace and defense products. The group provides a broad range of services worldwide, including facilities services, employee benefits and services, recruitment, wellness programs, security, fire protection, site operations, disaster preparedness, construction, reclamation, conservation programs, virtual workplace, creative services, transportation, business continuity and the purchase of all non-production goods and services. It also offers comprehensive travel services to Boeing employees. In addition, The Boeing Company manages the sale and acquisition of all leased and owned property. By integrating services, The Boeing Company delivers greater value, creates “lean” processes and operations, leverages buying power and simplifies access to services for all of Boeing.
Challenge
Boeing was looking for a company to provide accurate and advanced analytics for a multi-family for-sale condominium project. The Boeing Company initially enlisted the services of several local, regional, and national market research companies, but did not have confidence in their accuracy. Boeing ultimately chose Competitive Analytics because of our comprehensive approach and the robustness of our forecasting, optimization, and other analytical models and methodologies.
Solution
Competitive Analytics delivered customized advanced analytics, including: 1) Predictive analytics model for both supply and demand of apartment units, 2) Price optimization modeling, 3) Product segmentation analysis and modeling, and 4) Consumer demand analytics utilizing demographic and psychographic modeling.
Results
Competitive Analytics identified and quantified a potential positive gross revenue variance of approximately $78M ($76,529 on 1,016 DU’s), which was benchmarked from results of a well known research organization that does not use advanced analytics. This maximized Boeing’s top line pro forma revenue from previous home valuations based on out-dated and non-analytical approaches.
Return on Analytics
>650%
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