Boosting the performance of coupons in retail

Context & Objectives

A leading player in the retail industry wanted to assess the performance of its promotional campaigns based on various couponing initiatives.

The challenge in this type of analysis is to understand whether it is actually the coupon having an impact on sales: other factors come into play, some of which are easily measurable (competitors' prices) some less so (fashion and other macro trends).

Approach

First, we gathered the data on sales and couponing initiatives (activation period, type of store, face value, presence of other promotions...)

Then we modelled their impact on sales and the related thresholds.

Results

Our client has been able to improve its understanding of the critical success factors of its couponing campaigns.

  • We developed a model and a methodology that helped determine the optimal coupon on variables such as value, period and geography.

  • We also delivered an automation roadmap to enrich and industrialise the models in the existing systems.