As a retailer, have you ever participated in the promo wars? First, you follow your competitor’s promo and copy it not to lose your customers. A competitor reacts relevantly, making the discount even higher. It gets even more intense until a supply issue or some other problem is preventing you from further discounting. What’s next? Your competitor may outperform you unless you start carefully managing your promotions.
Good promotion campaigns ensure that you’re making a profit along with building a stronger loyal customer base.
For example, coupons are one of the easiest ways to draw in customers, with a whopping 68% of mobile device shoppers claiming that they’ve looked for retail coupons according to the 2017 UPS Pulse of the Online Shopper survey. This is due in part to the fact that 81% of shoppers claim that product costs are essential when they are looking for and choosing items online. Additionally, 70% of mobile users have compared the prices of retailers, since this information is easily accessible to them. As a result, why not enhance a price with an excellent promotion?
Promotion management is a type of interaction between a customer and a vendor with the help of discounts. The vendor uses promotions to draw customers' attention to products and services and thus encourage buying.
Creating promotions based on guesswork won’t take you anywhere but down, and on the contrary of attracting customers to stay, you’ll actually be pushing them away. Contrary to popular belief, many of these promotions, including your own, are working against you since they’re pushing shoppers away from becoming or staying loyal because these promotions are set from random conclusions that companies just pray will give them a positive outcome.
To make a sophisticated promo campaign, you need to count thoughtfully, what impact will this or that discount for a particular product have on your sales in specific channel. To forecast, to deliver, to analyze — those are the three pillars of promotions management.
Consumers today have complete price transparency. They can compare the prices of any store at any time. Therefore, it’s never been more crucial to have the most competitive prices in order to win them over. However, it’s also never been more challenging to do so since each rival keeps offering promotions, one better than the next.
However, contrary to popular belief, many of these promotions, including your own, are actually working against you since they’re actually pushing shoppers away from becoming or staying loyal because these promotions are set from random conclusions that companies just pray will give them a positive outcome.
Let’s take a more in-depth look at promotion analysis.
The assortment management is a task both for category manager and marketing manager: what categories to promote in order to maximize the footfall?
Divide the inventory into four parts depending on their market penetration and sales frequency.
Feel free to launch promo campaigns for the categories marked in green.
There’s no reason to set massive discounts for a revenue builder — they are performing great as such.
In retailing, we focus more on sales promotions that gain the attention of various buyers. It’s especially useful when you’re introducing an item onto the market, or when it hasn’t yet gotten the amount of recognition that you had been looking for. In other words, you want to boost the sales of a product.
These two can be accomplished through some sales promotions including, but not limited to:
You can optimize these promotions by using data about what actually works. This is accomplished through thorough analysis, thus enabling you to make conclusions and improve the various promotional approaches.
In retailing, we focus more on sales promotions that gain the attention of various buyers. It’s especially useful when you’re introducing an item onto the market, or when it hasn’t yet gotten the amount of recognition that you had been looking for. In other words, you want to boost the sales of an item.
The promo campaigns are based on product cost, competition, and business strategy. Here are some stages of competition-based promos.
There are a number of steps that you can take to ensure that you’re making a profit along with building a stronger loyal customer base:
Sometimes retailers just consider the sales volumes in promo period to analyze the success of a campaign. They don’t take into account the fact that the sales volume after promo has dropped to the usual level. This is called subsidized sales and is not the thing you should be targeting, apparently.
A more beneficial approach would be to check whether the penetration went up after your promo was turned off. It’s important for the promo-driven markets. The more newly gained clients stay with you after the promo has stopped — the better, as goal of every promo is to increase customer base and loyalty.
Ideally, you want to find one that doesn’t rack your brain, but it should be fact-based, that way you can create a useful plan from well backed up predictions as well as track how those promotions are doing in regards to your brand image and your customer loyalty.
Competera takes advantage of established retailer strategies combined with the self-learning models in order to suggest you the best promotion so that you can get the best outcome. It comes with other features including imitations of potential situations as well as direct comparisons with your rivals through effective visuals. Therefore, not only can you make a prediction, but you can also have a few lined up that way you can compare them and see which one would be the most beneficial towards reaching your goal as well as implementing your strategy.
Therefore, now you can actually work on building promotions with the confidence that you’ll be able to satisfy your customers in the process.
With immediate competitor promo alerts, sales prediction and prognosis of your competitors’ impact from CompeteraMarket Test
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