Maximising the value of promotions (without over-stocking)

Properly integrated across a business, a well-executed promotions strategy can have a real positive impact on a company’s bottom line. From generating customer excitement and brand awareness to driving up sales, promotions are a valuable part of the retail toolkit – when managed correctly.

In the fast-paced world of retail & ecommerce, gaining high-level visibility on the impacts a promotion has on your entire supply chain is critical. From the initial push, to tracking the success of the promotion across the retail estate, through to ensuring that stock is deployed correctly as the promotion ends. In our consulting work with retailers this message never changes: visibility of data (and the insights and decision that data informs) is a vital component of delivering a successful promotion campaign.

Here are our top three areas where supply chain analytics can bring greater success to your promotions:

1. Playing tunes on deployment. 

During the initial stock push to retail outlets, product is often delivered directly by the supplier to ensure ‘plenty of stock’ is there for promotion start. While this often makes economic sense, there might also be opportunities for supplier deliveries during the promotion direct to outlet, rather than via central fulfilment. Saving time and money by cutting down on ‘double-handling’.

2. Understanding impacts on the wider product range.

The supplier working with you likely has little interest in the impact their promotion will have on your wider product range – however you probably do! Understanding this impact is vital: How much have sales moved from other lines to the promoted lines? Are stock levels in place should customers move back to the ‘other’ products once the promotion ends? Supply chain analytics can help you to identify these kinds of costly knock-on effects and make timely decisions.

3. Looking back to better execute in the future.

How can past sales patterns inform the planning of future promotions? Is it possible to identify the point in a promotion where no further products should be purchased from the supplier, to ensure that the remaining promotional stock is minimised? Or is it possible to work with the supplier to identify the point in a promotion when all purchases will be collected from retail outlets ‘for free’? Untapped data from your past promotions can provide valuable insight into your future planning.

A promotion is only as successful as the management behind it. By leveraging data and increasing visibility, you can ensure that your next promotion campaign doesn’t leave you with a headache.

For more on how our supply chain analysts can help you leverage your data advantage – get in touch.

About the author

Jon’s client work extends across Manufacturers and Retailers with a scope that covers high-level supply chain strategy through to detailed operational reviews and performance improvement. 

We are independent supply chain and warehouse consultants who specialise in data analysis, leading strategy, and bringing a fresh perspective to your supply chain challenges.

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