Dynamic Pricing Consultancy Project

Description

Summary of the work How Dynamic Pricing (DP) could apply to British Council and the IELTS exam product. What might the benefits be? What the gaps are and what a solution could look like. Expected Contract Length 6 weeks Latest start date Monday 1 November 2021 Why the Work is Being Done Hypothesis The International English Language Testing System (IELTS) is designed to help people work, study or migrate to a country where English is the native language. Customers can choose to take IELTS with the British Council, our competitor (IDP), or an alternative competitor test (TOEFL, Duolingo). Customers can book online or in person at a test centre, to choose a date to take the test with the British Council (takeielts.org). Two revenue opportunities could exist. Firstly, if the British Council could make incremental changes to the standard IELTS test pricing, when test events are in high demand, that could increase revenue. Secondly, if the British Council had the means to make changes to standard IELTS pricing, to incentivise customers to switch from IDP (because of a more favourable price), that could increase revenue. Problem to Be Solved Overview The opportunities described above are associated with the possible use of Dynamic Pricing (DP) as a solution for exams. DP by its nature is a concrete binary item, highly specific in character and predictable from the Artificial Intelligence (AI) perspective – enabling machine learning with every transaction – and this learning being potentially applied to prices in real-time. The question posed here is how that could apply to British Council and the IELTS exam product. What might the benefits be? What the gaps are and what a solution could look like. Objectives There are two/three questions this discovery exercise should seek to answer or provide an evidenced opinion on: Who Are the Users 1. Provide a view on what the costs and benefits to the British Council of having a DP capability and an opinion on its justification. Questions to be considered but not limited to: - Level of customer appetite in market for DP, - Commercial & financial analysis with scenario planning - Likely cost of algorithm/off the shelf solution set-up and maintenance - DP as a ‘defence’ measure i.e., would our competitors do it if we did it? - Possible impact on brand, does DP devalue the market or British Council This would be achieved via engagement with; - British Council’s personal on the commercial, financial & technical - External review of the market & market trends, particularly the largest countries (top 10) - External review of major competitor intentions/capability 2. What would a minimum and a maximum (3rd question) viable DP model look like based on: a. What capability currently exists within British Council to support it? b. What would be required to enable British Council to bridge the gap? c. What a base algorithm could cover that would be of interest to customers? d. What a tenable customer journey would look like? e. Why aren’t our competitors doing this? Work Already Done There will be 2 separate possible revenue streams: - Incremental to standard price caused by the test event being in high demand - Customer switch to British Council from IDP because of price The high-level estimate below suggests that if there is success with 2% of our volumes for in-demand dates and 2% movement from IDP, the net benefit would be over £700k pa. At 10% this rise to nearly £4m. Again, to emphasize this is exactly the type of refined analysis that British Council would expect from the exploratory phase. Existing Team Edward Murray, Head of Pricing, English and Exams Current Phase Discovery Skills & Experience • Knowledge of Dynamic pricing • Experience of assessing suitability of Dynamic pricing • Experience of Dynamic pricing in global education markets • Access to suitable data for this assessment Work Location British Council, 1 Redman Place, Stratford, London, E20 1JQ Working Arrangments to be agreed No. of Suppliers to Evaluate 3 Proposal Criteria • approach and methodology • how the approach or solution meets user needs • team structure / Knowledge and experience • estimated timeframes for the work • value for money Cultural Fit Criteria • work as a team with our organisation and other suppliers • share knowledge and experience with other team members Payment Approach Capped time and materials Assessment Method • Case study • Work history Evaluation Weighting Technical competence 40% Cultural fit 10% Price 50% Questions from Suppliers No questions have been answered yet.