I'm trying to figure out a way for calculating price optimization in a commerce environment. In other words, I'm trying to analyze how a company can increase revenue and profitability by analyzing costs, customer buying behaviors, competitive activity, demand signals and historic data.
How can I come up with a strong algorithm to do this? Performance is not an issue since I'm looking to do analysis in a big data environment.
This sounds like a forecasting question to me.
You can create greater optimisation on pricing, leveraging the front-facing staff through what-if scenarios. This will give you all the insights you mentioned above, which you can then feed into your algorithm testing.