Predictive Analytics Demo Series: Optimizing Merchandise Financial Planning
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We discuss and demo how to use predictive analytics to optimize the merchandise planning process. For the full webcast replay: https://www.celect.com/merch-financial-planning-webcast-replay
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Predictive Analytics Demo Series: Optimizing Merchandise Financial Planning
- 1. Predictive Analytics Demo Series Optimizing Merchandise Financial Planning
- 2. Agenda • Introduction to Celect • Current State of Retail • Understanding Customer Choice • A Prescriptive Retail Process • DEMO – Optimizing Merchandise Financial Planning © 2016 Celect, Inc. All Rights Reserved.2
- 3. THE WAY YOU USE YOUR DATA HAS FUNDAMENTALLY CHANGED © 2016 Celect, Inc. All Rights Reserved.3
- 4. Current state of retail © 2016 Celect, Inc. All Rights Reserved.4 Retailers are Awash in Data Inventory, PoS, browse history, transaction logs, search, etc. Online/Offline are Blurring Merchants often have responsibility for both online and in-store Need for Growth Opportunities Improved Allocation, Buy Accuracy, Assortment Planning
- 5. © 2016 Celect, Inc. All Rights Reserved.5
- 6. There’s a better way © 2016 Celect, Inc. All Rights Reserved.6 Bring Science to the Art of Retail • Supplement your experiences, knowledge, and intuition with machine learning • Leverage the data you already have Predicting Customer Choice • How products interact and influence each other • Assortment Planning, Buy Accuracy, & Allocation
- 7. The evolution of predictive analytics in retail © 2016 Celect, Inc. All Rights Reserved.7 Basic reporting on historical data (Excel) REPORTING What happened? ANALYSIS Why did it happen? Business Value Complexity MONITORING What’s happening now? PREDICTIVE What might happen? Stats based on traditional metrics (Excel) Decision support via machine learning Dashboards, traditional planning tools Provides foresight into making decisions happen
- 8. What kind of foresight? © 2016 Celect, Inc. All Rights Reserved.8 We sold out of a particular product in Store 28 WHAT WAS THE RIGHT ALLOCATION? We have never sold a particular product in Store 58 HOW WELL WOULD IT SELL THERE? We are looking to add a new brand in to a set of stores WHAT IMPACT WILL THAT HAVE ON STORE SALES?
- 9. A prescriptive retail process Plan Buy Allocate Sell Liquidate © 2016 Celect, Inc. All Rights Reserved.9 What product and how much should I buy? Did I over-buy or under-buy? Is the product in the right stores? Did I maximize full price sell- through? How much margin did we lose? Prescriptive Decisions Optimized Assortments Optimized Allocation Engaged Customers Optimized Markdown
- 10. A prescriptive retail process Plan Buy Allocate Sell Liquidate © 2016 Celect, Inc. All Rights Reserved.10 What should my financial targets be for a given timeframe, location, or merchandising hierarchy? Planning system of record integration Prescriptive Decisions Optimized Assortments Optimized Allocation Engaged Customers Optimized Markdown
- 11. DEMO! © 2016 Celect, Inc. All Rights Reserved.11
- 12. Thank you! © 2016 Celect, Inc. All Rights Reserved.12 www.celect.com/ blog.celect.com Follow us on Twitter! @celect
Editor's Notes
- You don’t have a data problem. You have all the data you need, but how you leverage it has changed.
- Thankfully there’s a better way to make decisions from your data. Use data you already have – mentioned in previous slide. Just need to operationalize that data. Things like inventory data, browse history, crm data, etc. You have it all, it just needs to be pieced together. By understanding customer choice, your data allows us to understand how they interact with a specific assortment – and how products interact.
- From hindsight to foresight.
- Retailers are unable to answer those questions with the tools they have today. A prime example of this is spreadsheets.
- This process is lacking prescriptive insights and decision making capabilities to drive revenues. Celect is here to do just that.