When done correctly, price optimization closely matches supply and demand, enabling a company to recover lost revenue and serve more customers. Successful implementations continuously take in new data and update prices dynamically, though perhaps not instantly. In some industries, such as travel, this is called Revenue Management.
Price optimization is the science of matching the right price to the right customer segment. It is part of the larger marketing mix science, and can be implemented either separately or in conjunction with changes to other P's–but does not necessarily need to involve other changes.