In an increasingly uncertain world we are seeing a shift from descriptive to predictive analysis as brands realize that past performance is no longer a guarantee of future performance. Accenture explain the difference between descriptive and predictive nicely in a report title The Allure of Pricing Predictively.
“Descriptive analytics—already in wide use in many ad hoc ways—looks at historical data, helping companies answer such basic questions as what happened, why it happened, and how much it helped or hurt results.
"Predictive analytics extends those findings using sophisticated statistical modeling, forecasting and optimization algorithms to anticipate the impact of various actions, such as promotions, price changes and advertising, on business outcomes.
“Predictive analytics is about more than simple linear what-if exercises. It enables complex, dynamic research with multiple variables and often involves flurries of concurrent, low-cost, fast-turn market experiments. Forecasts become more about facts than about hunches.”
The report focuses on using predictive analysis to determine optimal pricing for a brand’s offering. You can access the report here.