How can you improve your promotional planning for next year?
This year, people are buying their holiday gifts early. It is no wonder because, for the past two years, we’ve seen the pandemic impact holiday shopping in a multitude of ways, including supply chain disruptions and shortages. However, due to rising inflation and cost of living, more than half of shoppers are also planning to hold off on buying gift items until they are on sale, according to Google data.
It all started today on Singles Day. What began as an unofficial Chinese holiday has become a major shopping event worldwide. But the most prominent event is still yet to come, with Black Friday Weekend happening at the end of the month.
People increasingly rely on digital ways to make their purchasing decisions. Even though there is a notable increase in footfall in traditional retail stores around major shopping events, the shopping journey begins online and often months in advance. In fact, as early as July, Google searches for “Black Friday deals” grew by over 200% in the U.S. compared to last year
Perfect Your Promotional Planning
November is the time when most consumers will do some, if not all, their holiday shopping. So, the stakes are huge, with many businesses generating their highest sales of the year on Black Friday. However, there is potential for downfall. People will be spending their money, and if they don’t find what they are looking for with one business, they will move on to the next one. The potential risks and rewards create significant challenges for supply chain management and make accurate promotional planning even more critical.
As we mentioned in Resetting After Disruption: Are We Ready For a Promotions Challenge, if a organisation’s promotion planning is not up to scratch, it creates potential risks:
- Overselling – if the promotion wasn’t fully incorporated into the plan, then there’s a chance that the right inventory is in the wrong place when needed, creating stock-outs and service level issues.
- Overstocking in the future – if the level of demand generated during the promotion isn’t properly incorporated and accounted for in the demand forecasting model, then replenishment actions are working at odds with the aim of the promotion.
Here are some key benefits of AGR’s Inventory Optimisation solution to your promotional planning:
Harness Your Historical Data
It’s essential to learn from your failures as well as your successes. By looking at historical transactional data across multiple promotional periods and analysing the baskets to evaluate the success or failure of each, you can improve future promotions. You may also want to consider lost sales due to stock-outs and adjust future forecasts accordingly.
Whether your products are on the manufacturing line, in transit, or already in your warehouse or retail stores – you need to know where your products are and where they need to go. It can cost you to learn that your products are not where they are supposed to be in the middle of the Black Friday weekend, and it is too late for you to react.
During this important time of year, the integrity of the communications between your Sales, Marketing, and Supply Chain teams must be at its peak. Everyone needs to work from a single version of the truth – knowing the scope of the promotion and being confident that the relevant products are in place to support the promotion strategy. Last-minute additions or changes may seem like an excellent way to capitalize on new market intelligence, but they are risky and can easily result in customer disappointment.
Whatever the time of year, promotions can considerably impact your sales, and managing promotions effectively is a key success factor. AGR allows you to plan your promotions at any level of the business, and the system will automatically account for the promotional activity when planning orders and future stock levels. If you’re interested in implementing our Inventory Optimisation solution and ensuring you’ll do even better promotions next year, click here to connect with an AGR representative or book a demo.