Knowledge Center

Report from RSR, sponsored by Aldata

Promotions have undergone a strategic shift in the last two years, created by the combined forces of economic pressures; a re-learning of the importance of promotions as a traffic driver as retailers move away from other, less effective price strategies; and new requirements imposed by the drive to localize assortments. However, these new drivers behind promotions are creating challenges for a promotions process that was never very well-defined to begin with. Promotions today require much more granularity in both planning and execution; a thirty percent or more forecast error on a promotion forecast created at a distribution level is a recipe for disaster. And consumers are far less forgiving than they used to be - if a retailer makes a promotion promise to consumers that gets them into a store, it is imperative to not break that promise. A competitor is only a smartphone search away.

This document takes a look across all of RSR's research that is relevant to promotions, and brings it together to give a prospective view on the business challenges and organizational inhibitors related to promotions, along with the new demands being placed on the role of promotions in the retail environment. Recommendations follow on how to get started down the path of a world-class promotions process.