Science and demand forecasting to identify and execute optimal markdowns

Use data-driven markdowns

Coop Danmark boosts sales and profits with analytics

Use data-driven markdowns

Coop Danmark boosts sales and profits with analytics

IBM Markdown Optimization uses science and demand forecasting to help design markdown plans with optimal timing and depth. It helps retailers optimize profitability and achieve inventory for virtually every clearance item in stores and online.

IBM Markdown Optimization can help you:

  • Optimize markdown timing and depth to achieve inventory, profit and revenue objectives.
  • Develop plans for a chain, divisions, zones or individual stores based on store-specific customer demand.
  • Automate weekly markdown pricing processes to reduce manual tasks and streamline the markdown process.

Optimize markdown timing and depth

  • Use the advanced science of consumer demand management to optimize markdown timing and depth.
  • Work with item-level modeling and optimization to capture the elasticity of individual items at the store level.
  • Set primary and secondary goals to reduce inventory, optimize profit or increase revenue.
  • Specify a maximum number of markdown price changes, the depth of each change and other constraints to help create markdown plans that comply with existing retailer policies, processes and infrastructure.
  • Optimize to budget or other metrics help to adhere to business requirements.
  • Advanced rules and constraints include capabilities to optimize cross-channel inventory to maximize profits.

Develop plans for a chain, divisions, zones, or individual stores

  • Devise markdown plans based on the price elasticity and inventory position at individual stores.
  • Allow store groups or zones to share the same schedule, or let individual stores execute their own schedule to optimize overall plan performance.
  • Create, forecast, compare and evaluate multiple markdown pricing scenarios to fine-tune markdown strategies before prices become effective in stores.
  • Analyze business performance and identify markdown liability products with a flexible reporting engine that provides historical trends, plans, and forecast information.

Automate weekly markdown pricing processes

  • Create and initiate automated markdown plans and scenarios based on category or class-specific rules defined by the retailer.
  • Enable merchants to log into the system to review the results of planned optimizations.
  • Closely monitor the performance of markdown plans through extensive reporting capabilities.
  • Automate the process of weekly re-optimization to continuously adjust markdown prices based on sales performance and plan objectives.
  • Offer full end-to-end automation from plan creation to approval to streamline processes and improve productivity.

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