Modelling, Strategic Optimization, Strategy Planning
Outcome Modelling
Understanding the consumer’s response to a promotional activity is the foundation of trade spend management. Shopping is a repetitive requirement for us all. Keeping the pantry stocked and food on the table calls at the fundamentals of our survival instincts. Understanding the replenishment and consumption cycle and the circumstances that shape the pattern of every phase is the quest of the grocery marketer. At its core is the science of statistics. This sound and proven mathematical approach gives the planner an objective and analytical understanding of the past and a methodology with which to predict likely future consumer behaviour.
Using Promax, team members can build a comprehensive model of the outcomes they’re trying to achieve. Promax takes into account all available information resources that inform the planning process and lets planners dynamically adjust underlying causal drivers to assess the impact these changes will have on their plans.
In less time than it takes to assemble a typical trade promotions plan, Promax lets your team model a range of possible outcomes, fine tuning their approach or examining entirely different strategies.
In the background, it also monitors important parameters (such as compliance with business rules and potential clashes) to engineer the optimal plan for the business. Download our “Modelling Multi-Causal Data in Promax PX” White Paper to learn more.
Dynamic Modelling
The Dynamic Modelling capabilities built into Promax allow companies to develop promotion plans that deliver the optimum Return on Spend. Configurable rules ensure that promotion plans are aligned with intended business outcomes such as revenue growth, cost containment and increased profitability.
The modelling tools span all relevant areas of the business and consider all the variables that will affect the anticipated business outcome. This leads to better demand planning, less inventory, and overall, a higher profit margin.
Scenario Simulation
Unique Scenario Simulation functionality available with Promax allows users to quickly investigate multiple models to evaluate their bottom-line impact. This allows organisations to ensure that their spend is targeted for greatest value and maximum ‘bang for the buck’.
Scenario Simulation allows planners to quickly consider a range of options using highly effective planning capabilities, including:
- powerful simulation to discover what works and what does not work
- goal seeking including price, volume, and contribution sensitivity analysis
- side-by-side analysis of scenario outcomes for both seller and retailer
Rebate Modelling
Promax supports rolled-up or detailed rebates and incorporates them into planning models, thereby integrating all costs and terms in the one planning system. The system provides for user-definable rebate rules and the business impact can be calculated by Customer Account, Product or Product Group. When promotions plans are implemented, the rebate rules used in planning flow through into live transactions, driving more efficient and accurate processing and improved reporting.
Sales & Category Management
Promax gives the Sales Organisation all the information necessary to make sensible financial decisions when planning promotions. Sales need to understand the price sensitivity which helps in the decision making process when collaborating with the retailer on their pricing strategy. This helps provide decision support to sales – for example, understanding whether to fund an ongoing price decrease or whether the retailer should fund it because it is to their advantage only.
Promax provides answers to important questions from Sales Managers:
- Is the promotion likely to be financially feasible (before commitment to the promotion is made)?
- What is the profitability of the promotional program in one Account versus another?
- How effective are the promotions, i.e. which promotions worked or didn’t work?
- What is the most appropriate promotional program, including timing and length?
- Did the promotion increase volume and contribution, or only volume?
- What is the optimal price point to drive increased volume and contribution?
Promax also provides decision support to Category Managers for issues such as:
- How efficient are the category promotions?
- What can be done to optimise promotions for the category?
Promotions Matrix
The Promax planning interface is a sophisticated promotions matrix that gives planners wide-ranging visibility of the promotional plan and trade spend – including real-time evaluation of the anticipated efficiency and effectiveness of individual promotions.
Promax accommodates promotions that include combinations of different funding types. This eliminates the need to create individual promotions for different funding types – such as co-op, fixed charge, ex-factory deals, issues deals, scan deals and coupons. In Promax, these elements can co-exist and be optimised in a single promotion.
These are some of the advanced Promax Promotion Planning tools:
- customer aggregations to handle National accounts, banners, and customer families
- causal modelling automatically determines price/volume/contribution relationships, incorporate independent variables for features, events and environmental factors
- user-definable views for promotional plans, i.e. view by Customer Account, by promotional type, by detail in aggregate, or combinations of views
- unlimited planning horizon
- multi company and multi division, as well as multi region, multi channel
- promotional volume automatically calculated at scan, issue and ex-factory levels
- ability to plan at any detailed or aggregate level, i.e. Brand, Category, Range, Product Class, Segment, Variant and product attributes
- easy to use tools for creating and repeating promotions including Drag and Drop functionality
