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APT Illuminate
Technology Category
- Analytics & Modeling - Predictive Analytics
- Analytics & Modeling - Data Mining
- Analytics & Modeling - Real Time Analytics
Applicable Industries
- Retail
Applicable Functions
- Sales & Marketing
- Business Operation
Services
- Data Science Services
- System Integration
The Challenge
The CEO of a major US apparel retailer, with over $5 billion in annual sales, recognized that their existing promotional strategy was underperforming. The retailer had been running 45 circulars per year without holdouts but could only analyze a small subset of these circulars. Circular sales accounted for 20% of total store sales, making it crucial to optimize their performance. The CEO tasked the management team with leveraging data-driven analytics to make informed decisions on which items to promote and how to promote them.
About The Customer
The customer is a major US apparel retailer with over $5 billion in annual sales. The retailer had been running 45 circulars per year without holdouts but was unable to analyze more than a small subset of these circulars. Circular sales accounted for 20% of total store sales, making it crucial to optimize their performance. The CEO tasked the management team with leveraging data-driven analytics to make informed decisions on which items to promote and how to promote them.
The Solution
APT helped the retailer use three years of historical promotion data to establish the retailer’s non-promotional baseline. Analysts then used APT Illuminate to measure the impact of each promotion. APT’s rigorous analytical approach identified the drivers of promotional success. Specifically, the software determined which combinations of product, season, discount, media type, and placement in the circular led to different levels of performance. Further, APT Illuminate back-tested these findings to validate the accuracy of the predictions. Overall, APT Illuminate determined that 40% of the company’s promotions did not have any impact on sales, and in some cases were even profit-negative. Going forward, the retailer was able to develop a unique strategy for each circular to maximize the impact. In one month alone, APT Illuminate identified huge opportunities to shift away from poorly performing promotions, generating over $3 million in incremental margin.
Operational Impact
Quantitative Benefit
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