Download PDF

C5i > Case Studies > Advanced recursive chain forecasting model evaluates sales impact and helps form new strategy and future roadmap

Advanced recursive chain forecasting model evaluates sales impact and helps form new strategy and future roadmap

Technology Category

Analytics & Modeling - Predictive Analytics
Analytics & Modeling - Real Time Analytics

Applicable Functions

Business Operation
Sales & Marketing

Use Cases

Demand Planning & Forecasting
Predictive Replenishment

Services

Data Science Services

The Challenge

The client, a major technology company, was implementing changes around the different sales outlets to overcome competition and embrace the changing landscape. They replaced a few pre-existing brands with a single easy-to-carry, less space-occupying product across the major U.S. electronic/technology retailers for all the states. This step was taken as the company was facing issues like increasing instances of malicious downloads and difficulty in storage and use. The client wanted to conduct a deep dive study to understand the effect on sales due to these changes. They also wanted to breakdown the effect by different regions and products to develop a deep level understanding of various factors. This analysis will help the company evaluate the new strategy and hence formulate the future roadmap.

About The Customer

The customer in this case study is a major technology company operating in the Information Technology industry. The company was facing challenges due to increasing instances of malicious downloads and difficulty in storage and use of their products. In response to these challenges, the company implemented changes around their different sales outlets to overcome competition and adapt to the changing landscape. They replaced a few pre-existing brands with a single, easy-to-carry, less space-occupying product across major U.S. electronic/technology retailers for all states. The company sought to conduct a deep dive study to understand the effect on sales due to these changes and to develop a deep level understanding of various factors influencing their sales.

The Solution

Blueocean Market Intelligence built a customized solution to achieve the client's goals. The solution involved sales trend analysis of the product over a period of time, data harmonization for reducing seasonal impact and carrying out an unbiased analysis over a period of time, and a time series model to establish the unit sales volume for the products. The Recursive Chain Forecasting Model and Bayesian network model were used to determine the impact on sales due to the introduction of the transformed product. Techniques such as Granger Causality and Cross Price Elasticity were used for suggesting prescriptive measures for enhancing sales. The solution also involved data integration and cleansing for analysis development across all the states, integration of different sales data, and integration of other data sources like labor data at a zip code and month level.

Operational Impact

The analysis helped the client understand the seasonality of the products.
Blueocean Market Intelligence formulated bundling strategies by identifying products whose sales were impacted the most by introducing the new product.
The analysis identified segments that responded well to the introduction of the new product and suggested measures for improving sales.