The Competitive Advantage of a Forecast-driven Enterprise
Most retailers are acutely aware: November and December have nearly twice the revenue potential as any other month, and the momentum continues to grow. According to research from the National Retail Federation (NRF) Holiday Headquarters, more than 165 million people shopped either in store or online during the Black Friday weekend and into Cyber Monday, and it is estimated consumers will spend 4.1% more than last year during the winter holidays.
Studies report that 50% of shoppers say that limited-time sales and promotions convinced them to make a purchase and 77% have left a store on average four times during the holiday season when they couldn’t find what they were looking for. Delivering an effective holiday promotional strategy is key to driving traffic and accurate inventory availability is critical to converting that traffic to revenue. If your forecasts are not accurate, you are risking out of stocks, unhappy customers and long-term loyalty.
The fluidity and frequency of seasonal assortments and promotional events coupled with the high-stakes of peak season trading put even more pressure on forecast accuracy for multiple business units – from merchandising to marketing to supply chain. If you are attending NRF 2019 stop by and demo Oracle Retail Planning Solutions.
As you prepare for your best season yet, here are some things to consider:
Weather: According to research done by Planalytics, a leading provider of weather-based predictive analytics, 4.2% of overall apparel stores’ sales are weather-sensitive during November. Impacts can fluctuate by over 35% across locations for key categories. For example, the weather in November when compared to the prior year drove a +17% increase in demand for boots in 'chilly' Knoxville while having a -19% decrease in 'warm' Denver. How do you capitalize on the uncontrollable, particularly for categories that are highly weather-sensitive? In partnership with Planalytics, Oracle Retail has developed approaches in RDF to incorporate weather analytics throughout the forecasting process – from de-weatherizing historical demand to reflect true trends and seasonality to incorporating imminent weather events into forecasting and exception-driven processes for weather-sensitive categories.
Delivering on your holiday strategy depends on informed pricing and promotional decisions based on forecasting insights, efficiently coordinating those decisions throughout the supply chain and ultimately to sales execution:
The holiday season offers opportunity and the forecast-driven enterprise is key to unlocking that potential. RDF Cloud Service reflects the culmination of 15+ years leading the industry in demand forecasting with an integrated perspective across Oracle Retail’s enterprise portfolio and proven across 160+ retailers worldwide. You can learn more about maximizing your potential with RDF Cloud Service in our Guidebook: 3 Steps to Simplifying Retail Forecasting and Planning.