You’ve got a great idea for a marketing tactic, but you want to see what the impact will be on your business before you take it out into the world? Marketers constantly pursue higher sales figures, employing various promotional strategies and events. An essential approach to maintaining relevancy and competitive advantage, promotions, and promotional events can become the stuff of nightmares for demand planners. 

Challenges Of Promotions Planning 

Demand planners are responsible for predicting future product demand and creating realistic schedules to enhance profitability. This job becomes increasingly tricky while factoring in various promotional events run by the marketing and sales teams like seasonal offers, holiday sales, festivals, etc. Planning promotions is a challenging task, and owing to the sudden jump in demand, the planner faces many challenges while predicting demand accurately.

• Unsystematic data capture
• Unclear correlation between the impact of promotions and sales numbers
• Unscientific approach and biases towards promotions planning
• Lack of promotional uplift forecast in current demand planning tools

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How Kronoscope addresses challenges faced in promotional planning

Fountain9’s predictive inventory planning product- Kronoscope, is an extremely capable, cost-effective, and reliable solution for accurate Demand sensing and Promotions planning. With a sophisticated approach, Kronoscope captures data at a very granular level and provides unmatched insights to demand planners. 

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Capturing promotions and special events:  

‍Capturing events in demand planning is a challenging task as typically, most of the event data reside in multiple spreadsheets, emails, and documents. This results in inefficiencies and errors in understanding the impact of promotions and using them for inventory planning.

Kronoscope, in its Events & Promotions module, allows demand planners to add individually or upload in bulk events plans, capturing data on impact SKU segment, event type, event treatment, and date range.

Understanding promotions impact:  

Typically, demand planners predict the promotional demand based on the previous order quantities on a similar promotion. More subjective personal factors like the demand planner’s gut feeling based on his years of experience also play a part.

Kronoscope’s AI engine utilizes an ensemble of multiple algorithms to factor in historical events data and future events calendars to find similar types of events and then predicts the demand uplift in the event period. Kronoscope undertakes real-time calculations to provide the planners with the best possible demand suggestions. Moreover, it gives demand planners the capability to edit and refine plans, and once frozen; the collaborated plan gets used for generating inventory plans. 

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Identifying crossover impact  of promotions on one product/category to other associated products/categories: 

Businesses often produce complementary and substitute products. Promotions running on one will almost always affect the demand numbers of another. For example, promotions running on shampoos will have some effect on the demand numbers of conditioners.

It is almost impossible to predict these changes manually but can be done with the help of advanced AI-powered promotions planning. 

Establishing a visual correlation between the impact of promotions and demand: 

While AI and human experiences are a great source of decision-making on their own, their impact increases manifold when used in tandem. While an AI platform will predict demand by looking purely at data presented to it, there are many unknown factors that may affect the actual demand. This is a significant challenge faced by demand planners.

Kronoscope provides insights on a granular scale; once the historical event data and future promotions calendar is captured into Kronoscope, demand planners get a promotional uplift chart that showcases a baseline and forecasted demand for a particular SKU for an upcoming event. They also have an option to use their business know-how and judgment to refine the system's suggested recommendations. 

The green spikes in the graphical representation below represent the actual demands of a promotional event in the past. Krononocpe, apart from baseline demand prediction, factors in the green spikes and showcases forecasted demand in red. Demand planners can also view the accuracy of the prediction in real-time, helping in shorter decision-making.

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Kronoscope’s bottoms-up approach towards demand sensing helps it quickly adjust to changes in demand. Moreover, it provides higher prediction accuracy due to the systematic incorporation of demand drivers in demand sensing.

Its self-learning AI engine captures and processes data on SKUs, warehouses, distributors, and channels on a daily level and quickly adapts plans as per changing demand patterns.

AI and predictive analytics products like Kronoscope are an excellent way for businesses to provide synergy between demand planning and marketing. Kronoscope easily accounts for the complexities of sales promotions with predictive analytics, allowing businesses to see the future outcome of any given promotion.