10% net profit increase with AI-driven markdown pricing
FAM Brands gained 10% increase in their net profit with Sniffie’s AI Pricing Tool Markdown module.
Director of new business
Amazing for clothing business!
FAM Brands in a nutshell
Established in 2000, FAM Brands specializes in designing, producing, and distributing activewear for both men and women. Their distribution strategy is omnichannel-based. They sell their brands through major retailers, large department stores, and in their D2C shops. FAM Brands trademarks are Marika, Wildfox, Three Dots, Zobha and Ellie.
Fashion and clothing market overview
The global clothing and fashion market is valued at approximately 3 trillion USD and continues to grow. As a result, the online retail clothing market is becoming increasingly essential and reaching over 700 billion USD by 2024. The market is highly competitive and dynamic, having Ecommerce players such as Amazon, Zalando, and ASOS showing the way.
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“It used to be very time consuming having to think what’s the optimal price for this product (x) should I reduce it, should I not reduce it but with this tool we’re able to outsource the decision making to the AI and we don’t have to break our head on it.”
Director New Business Development, FAM Brands
The challenge the fashion company FAM Brands had
The main challenge for FAM Brands was to optimize their product lifecycle pricing. Another big pain point for FAM Brands was the large number of SKUs and the small team to manage them.
FAM Brands faced a decline in gross margins due to inflation and had to develop solutions to increase profitability. The company evaluated different pricing strategies to raise prices without negatively impacting conversion rates and their overall business. One solution implemented was selectively increasing prices on items having higher demand and reducing prices on items that created a higher sales volume.
Additionally, the company faced challenges in efficiently managing many SKUs with limited resources. To support the new strategy FAM Brands chose Sniffie AI Pricing tool How to streamline the process, get more precision with AI and improve management of the product selection.
FAM Brands uses AI Pricing Tool to optimize pricing
FAM Brands uses Sniffie AI Pricing Tool for Profit Optimization, and for their markdown pricing campaigns. The team consists of several users who plan and execute the AI-driven markdown campaigns when the products are closing in their end of lifecycle. The team also uses Sniffie AI to optimize the product prices for the overall best profit.
What was the outcome after the first six months?
When we asked Justin how has Sniffie AI Pricing tool helped them to solve their issue, the answer was clear:
“It has definitely made it easier for our merchandisers to perform their daily activities. It has increased our gross profit by about 10%, and our net profit by just about 10% as well which is really powerful, it has almost doubled our net profits.”
Net Profit Increase
Time saved in pricing
Number of SKU's managed
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Take the first step and see how we might help you. We offer a 14-day free Shopify trial. No credit cards needed – no strings attached.
What are the things that users like in Sniffie?
When asked how the “How have you liked the product so far?” Milton Ramirez, super user of Sniffie from FAM Brands adds:
“I agree with Justin, the beginning stages were the difficult ones, trying to learn something new, in this case with AI. But like Justin said the product does serve its purpose. The product has better facilitated my time as a merchandiser at our end in terms of managing our products at a mass level, and just being able to edit them at a mass level saves a lot of time when I can make changes to a whole group of products in a matter of seconds, although it was time consuming in the beginning during the learning process. It is very beneficial at my end as well.”
…and Justin adds:
“And it used to be very time consuming having to think what’s the optimal price for this product (x) should I reduce it, should I not reduce it but with this tool we’re able to outsource the decision making to the tool and we don’t have to break our head on it.”
“Sniffie has definitely made it easier for our merchandisers to perform their daily activities. Sniffie’s product has increased our gross profit by about 10%, and our net profit by just about 10% as well which is really powerful as it has almost doubled our net profits.”