In today’s data-driven world, leveraging data and analytics to optimize pricing strategy for eCommerce is essential for businesses to remain competitive. With the vast amounts of data available at our fingertips, businesses can use this information to identify trends, predict consumer behavior, and make informed decisions that will increase sales and revenue.
Data refers to any information that is collected, stored, and analyzed for insights or decision-making. This information can be collected from various sources, such as sales records, customer feedback, or social media interactions.
Analytics is the process of analyzing this data to extract insights and patterns. Analytics can be used to identify trends, predict future outcomes, and make data-driven decisions. This process involves applying statistical models, algorithms, and other analytical techniques to large datasets.
Why are Data and Analytics Important for Promotional Planning?
Promotional planning refers to the various tactics businesses use to promote their products or services. This includes advertising, sales promotions, public relations, and personal selling. With so many options available, it can be challenging for businesses to determine which promotional strategies will be most effective.
Data and analytics can help businesses make informed decisions about their promotional planning strategies by providing insights into customer behavior, preferences, and purchasing patterns. By understanding these factors, businesses can tailor their promotional planning strategies to meet the needs of their target audience, increasing the likelihood of success.
Leveraging Data and Analytics to Optimize Your Promotional Strategy
There are several ways businesses can leverage data and analytics to optimize their promotional planning:
Capturing Special and Promotional Events
Demand planning can be difficult to implement because the majority of event data generally resides in numerous spreadsheets, emails, and documents. Because of this, it is inefficient and incorrect to consider the effects of promotions while making inventory planning decisions.
Demand planners can enter individual or bulk event plans into the promotion planning software’s Events & Promotions module, which captures information on the effect of SKU segment, event type, event treatment, and date range.
Comprehending the Impact of Promotions
Demand planners typically forecast promotional demand based on past order volumes for comparable promotions. The demand planner’s intuition based on his years of experience and more irrational personal characteristics also contribute.
In order to locate similar types of events and forecast the increase in demand throughout the event period, the AI engine infused into promotion planning software combines a number of different algorithms with past event data and upcoming event calendars. The software performs calculations in real-time to give planners the most accurate demand forecasts. Additionally, it allows demand planners to amend and improve plans, and once they are frozen, the collaborative plan is utilised to create inventory plans.
Gauging the Crossover Promotional Impact of One Product on Related Products
Businesses frequently create items that complement and replace one another. The demand figures of one will almost always be impacted by promotions running on another. For instance, there will be some impact on the demand for conditioners from promotions running on shampoos.
Manually predicting these changes is very hard, but smart AI-powered promotional planning can help.
Establishing a Relation Between Promotional Impact and Demand
While AI and human experiences are both excellent sources of decision-making on their own, when combined, their influence is multiplied. While an AI platform forecasts demand based solely on the data provided, there are other unknowable elements that could influence the actual demand. Demand planners are presented with substantial difficulty in this regard.
The demand planners receive a promotional uplift graphic from promotion planning software that shows the baseline and anticipated demand for a certain SKU for a forthcoming event after importing past event data and the future promotions calendar. Additionally, they have the choice to hone the system’s offered solutions using their own business expertise and discretion.
Demand forecasters can also see the prediction’s accuracy in real-time, which speeds up decision-making. Promotion planning software can quickly adapt to changes in demand thanks to its bottoms-up approach to demand sensing. Additionally, because demand drivers are systematically incorporated into demand sensing, it offers improved prediction accuracy.
On a daily basis, its self-learning AI engine gathers and interprets data on SKUs, warehouses, distributors, and channels and instantly modifies plans in response to shifting demand trends.
Tools that use AI and predictive analytics are great method for companies to integrate marketing and demand planning. With the software’s predictive analytics, organizations can simply account for the intricacies of sales campaigns and predict how they will turn out in the future.
Fountain9 has developed Kronoscope, an AI-powered solution that aids companies in managing the increased demand during promotional marketing campaigns. Kronoscope incorporates a promotional planning and price optimization tool that enables businesses to plan promotions, anticipate demand, and tackle operational complexities through informed pricing strategies. By leveraging Kronoscope, businesses can access valuable insights into consumer demand and select the most suitable pricing approach to execute the right promotion at the optimal time and location.
Furthermore, the software utilizes data to suggest appropriate price points for each SKU, considering revenue targets, margin constraints, and wallet share. With Kronoscope, businesses can effortlessly implement effective omnichannel pricing strategies for eCommerce to achieve their desired business goals. By adopting the right pricing strategy, businesses can enhance profitability and reach their revenue targets with ease.