Retail Promo Planning

Integration of Individual Transaction Data Provides More Detailed View of Promotion Impact

ISSUE

A large convenience retailer wanted to develop a holistic understanding of promotions – not just sales effectiveness and profitability but also their impact on basket size, product-specific trips and overall total store trips. Traditional data and modeling methods allow only for assessing the impact on sales.

INSIGHTS

IRI partnered with the retailer to build a sales and causal drivers database, leveraging individual transaction data. A store-specific promotional event database, including “continuous” promotions and “strict” multiples, pushed IRI to design novel approaches to assessing promotion impacts. IRI found that the impact on basket size was more moderate compared to the impact on volume and dollar sales, even for popular and attractive promotions. And, while promotions drove product-specific trips, they didn’t always contribute to “incremental” trips to the store (multiple promotional items in the same basket). Promotions backed by marketing and external displays, and those tied to new product launches, were more effective in driving traffic to the store.

IMPACT

Integration of the model results with IRI’s retail promo planning solution helped drive real-time insights and actions based on overall promotional ROI. This accounted for multiple outcome measures rather than a pure impact on sales. The client was also able to rethink its marketing strategy and prioritize specific events for maximized impact.

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