Profit optimization solutions enable an organization to efficiently manage and optimize the price of its goods and services, and to offer and manage off-invoice rebates. These solutions also offer a growing range of sales intelligence advice, such as next best action recommendations and customer churn warnings. Profit optimization solutions often integrate with, but are considered separate from, configure, price and quote (CPQ) applications. Profit optimizations solutions are used primarily by back-office product management, sales operations, pricing management and deal desk teams, although the outcomes and recommendations are surfaced in sales channel tools such as CPQ.
Gartner defines configure, price and quote (CPQ) applications as software that enables sales organizations to automate and optimize the creation of quotes and capture of orders. A CPQ application is a sales tool that captures the new goods and services a customer wants to buy or the changes a customer wants to make to existing goods and services. While generally focused on assisted sales channels, CPQ capabilities such as product configuration and pricing must be shared with the self-service commerce channel. The new purchases and changes must be priced and a binding contract must be formed with the customer before sending an order to downstream fulfillment systems.