Audi on demand is a premium app-based car rental service offered at participating Audi dealerships across the United States. With a fleet consisting of award-winning Audi vehicles – and services including contactless pick-up and drop-off, optional delivery, and a seamless user experience – Audi on demand continually earns the highest customer satisfaction and loyalty scores in the industry. When the company’s lean pricing team needed to support exponential company growth, they chose Pricemoov’s next-generation pricing platform to streamline pricing processes and maximize profitability. 

Facing Difficulties to Adapt Prices to Market Shifts

In a dynamic and highly competitive car rental market where differentiation is crucial, capturing a company's unique offerings within a single pricing structure can be a challenge. That was the situation facing Audi on demand, despite providing an exceptional customer experience. 

The company takes local events, nuances, seasonality, average rental length, and more into account when setting prices, while its two pricing professionals regularly analyze customer price sensitivity. As Maria Ogando, Director of Product and Business Intelligence for Audi on demand, says, “The rates fluctuate drastically with big rental providers managing large vehicle volumes. We want to ensure long-term customer loyalty by maintaining a reasonable price cap.”

Ogando further explains that “We are not like car rental companies that people book out of necessity to drive away from the airport. People book with us because they enjoy our cars and the Audi experience. We strive to optimize prices in order to exceed the expectations of our valued customers.”

Using reporting and visualization tools, Ogando manually monitored and adjusted rates. While they made small price changes weekly and set strategies on a monthly and quarterly basis, it took an entire day to develop a strategy and one to two hours or more to compile a large file of prices. On top of that, it took another 20 to 50 hours to load the rates on the Audi on demand website.

This labor-intensive and time-consuming process to monitor and deploy price changes distracted from their other responsibilities, such as analyzing business performance. Plus, it slowed the lean team’s reaction to changing competitor rates and market dynamics. 

According to Ogando, “We were highly susceptible to market shifts and it took us a long time to react, whether to dips in reservations or an upswing in cancellations.”

As Audi on demand entered a significant expansion period, it became evident that the pricing team’s approach wasn’t sustainable. “In our quest to significantly grow business in a short space of time, we had to either grow our team or automate. Despite a previous unsuccessful experience with another pricing software, we knew it was time to give it another shot,” explains Ogando.

Simplifying Pricing with an Intuitive Solution

Considering previous challenges with a complicated pricing tool, Audi on demand opted for the user-friendly and easy-to-implement Pricemoov platform. Following a successful proof of concept with select dealerships, the company implemented the solution across all its locations.

The pricing team appreciated the platform’s capabilities, including being able to create detailed pricing strategies, monitor and easily turn these on and off by calendar day, and configure the visualization and modification settings for each strategy. Moreover, they valued the ability to compare and benchmark their prices against competitors.

The team also liked that Pricemoov’s dynamic pricing logic is based on business rules that they could easily control and adjust as needed. “We focus on setting the right price ranges for our growing fleet of cars and rely on Pricemoov to optimize prices daily across our 50+ locations,” Ogando states.

Greater Agility and Yield Management Through Dynamic Pricing

With the seamless integration of the Pricemoov platform into Audi on demand’s back-end systems, the company can automate price computations and make real-time changes, enabling dynamic price updates multiple times a day.

The pricing team can also efficiently monitor daily performance and promptly identify any pricing issues. After a quick performance analysis, Ogando can swiftly set up a pricing strategy and apply it to the relevant locations, ensuring optimal results. 

Moreover, the team can effortlessly develop and manage a yield strategy that considers factors such as seasonality, occupancy, and booking lead time. As Ogando explains, Pricemoov makes it possible to price far out into the future. The team can easily set a pricing strategy a year in advance – and manage close to 110,000 price points, all of which can be changed nearly instantaneously. Plus, the team can build a pricing strategy and tailor rates around seasonality at a granular level while taking into account the insights of regional directors to optimize revenue. “Because we can put long-term strategies and rates in place – and rely on Pricemoov to automatically update these as the dates draw near – we’re not losing revenue due to poor pricing decisions,” says Ogando.

Additionally, by having the ability to easily monitor Audi on demand’s prices in comparison to competitors by product and location, the team can set rules that align with its business and brand strategy. “We don’t just want to chase competitor prices up and down. We want to stay true to our customers while remaining competitive,” explains Ogando.

Saving Money While Boosting Productivity

In late 2021 and early 2022, the car rental market fluctuated wildly due to various factors. According to Ogando, without the ability to proactively set and change prices, Audi on demand would have experienced a net loss. “Pricemoov allowed us to ride out that wave,” she says. 

“Pricemoov enabled us to act as a business intelligence team, not just a pricing team. We support all data needs across the company, and with Pricemoov, we could dedicate time to understanding and optimizing other areas of the business,” adds Ogando.

Since implementing Pricemoov, Audi on demand doubled its number of locations. “We wouldn’t have been able to do this without Pricemoov. We would have made less frequent price updates and taken bigger hits in yield management, or been forced to add one or two analysts to manage the higher volume,” she continues.

In fact, the company’s pricing team has recouped a minimum of 20% of their time, and that productivity boost translates to many thousands of dollars annually. 

As Ogando concludes, “As we expand our business, we don’t have the necessary data points to understand the local markets. Pricemoov gives us a leg up, allowing us to quickly get a feel for the local market and competition to set the right pricing strategy.”