For Better Retail Promotions, Ask These Questions
Discounts and promotions are at an all-time high, often comprising the single-biggest cost within many retailers’ P&Ls. Yet despite these high stakes, and the growing adoption of sophisticated analytics, many retailers continue to take a broad-brush approach to running promotions that results in missed sales and profits. The most common explanation for this lack of precision is that retailers tend to evaluate promotions at a high level, without drilling down to understand the impact of individual tactics within each promotion. By this, we mean they compare the overall event to last year’s promotion in aggregate without understanding how different parts of the promotion might be more or less successful; getting the mix right is the key to creating more impact on sales and profits. Read more at Harvard Business Review.
