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Retail customer intelligence

Building Customer Intimacy for a Global Fashion Retailer with Customer Intelligence Solution

Customer experience and satisfaction have come to the forefront across industries. As such, it is now imperative for companies to create a 360-degree view of their customers to know and respond to them in real-time with a highly personalized approach. When it comes to the fashion industry, which is one of the most volatile and rapidly changing sectors, staying relevant and exciting could prove to be challenging. Brands must keep constant tabs on how consumer shopping trends are evolving and identify the gaps before it’s too late. Those brands that fall behind from doing so often fail to thrive in the long run. Furthermore, with the world going digital, consumers are rapidly integrating tablets and smartphones into shopping. This makes integrating digital into business a key to optimizing the brand experience. Top fashion retailers turn to customer intelligence solutions to gain a better idea of how their customer shopping patterns are changing and identify what they need to do in order to adapt.

By bringing together customer, sales and inventory information from siloed applications, brands can benefit from access to powerful consumer insights for better decision-making across sales, merchandising, marketing, logistics and improve customer experience. Know how we can help you achieve this.

The client

The client is one of the most iconic fashion retailers having stores set up in 50+ locations around the globe. The company has been in business for over 40 years.

Business challenges

The client recently moved to an omnichannel model of business in order to keep up with the changing trends in the fashion industry. Despite this, they noticed a constant decline in their profits from online channels and also a dip in footfalls in their brick and mortar stores. They approach our industry experts to leverage our customer intelligence solution and identify where they lacked in keeping their customers hooked on to their brand and understand ways to enhance their profit margins. Using customer intelligence services, they wanted to:

  • Gain a single view of customers (including purchase history, feedback, and preferences) across different touchpoints
  • Identify issues faced by customers both instore and on online platforms and analyze ways to resolve these issues
  • Enhance their merchandising to suit the tastes and preferences of target customers
  • Formulate strategies to avoid strategies of stock-outs of excess stocks that can have a significant impact on the profit margins

Get in touch with an expert to know how we can help you solve key business challenges.

Solution offered

As a part of the customer intelligence engagement, our experts undertook a customer segmentation analysis to group different target consumers of the brand based on the touchpoints through which they interacted or purchased from the brand. Infiniti’s experts then followed a customer need analysis to better understand the needs of the target customers and gauge their satisfaction levels. This helped identify the gaps in service and products and gave the company a fair idea of their areas of improvement.

Apart from the customer intelligence solution, the experts also used demand planning and forecasting analysis to identify the optimal stock levels that the business must maintain in order avoid situations of overstocking or understocking or avoid supply-demand mismatch.  The client also gained comprehensive insights and strategies on how they can optimize their supply chain processes to better meet the demands of target customers.  

Business impact

The customer intelligence engagement helped the client in:

customer intelligence

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sales forecasting methods

Everything You Need to Know about Using the Right Sales Forecasting Methods

Sales forecasting methods are used to predict how much of a particular product is likely to be sold within a specified future period in a particular market at a specified price. Using accurate sales forecasting methods is vital for any business to be able to produce and sell the required quantity of goods at the right time. Furthermore, by helping companies to gauge the demand, sales forecasting techniques ensure better inventory management.

Why are sales forecasting methods important?

By leveraging the right sales forecasting methods that suit the business, companies can spot potential threats and demand fluctuations while there is enough time to avoid and mitigate them. For instance, if a business uses sales forecasting techniques and notices that their team is trending much below quota, it gives the business the opportunity to understand what is going wrong and undertake a corrective course of action. Discovering such problems at the early stage rather than at the end of the month or the quarter makes a huge difference to the overall sales. Sales forecasts can also be taken into consideration for a decision including hiring, resource management, goal-setting, and budgeting.

Failing to meet the forecasted goal can significantly hurt stock prices. This can be avoided by leveraging the right sales forecasting methods and strategies. Request a free proposal to know how experts at Infiniti research can help you choose the right sales forecasting methods for your business.

Factors that affect sales forecasting

Sales forecasts are often influenced by both internal and external factors of an organization. These factors can also greatly influence the sales forecasting methods chosen by companies.

sales forecasting methodsInternal factors

Changes in sales territory

If territory assignments are shuffled, boundaries are redefined, or a new sales territory management plan is introduced, there are chances of a temporary dip in sales. However, sales will bounce back to an even higher point once the company’s sales representatives adjust to their new, optimized territories.

Changes to compensation plan

If a company decides to make changes to its sales compensation plan or commission structure, it is likely to have an impact on the sales structure. For instance, if a company switches to a structure that rewards sales representatives for increasing revenue rather than closing more deals, their forecast should anticipate fewer new accounts with a focus on targeting higher-value customers.

Changes in the team size

When more sales representatives are hired, the company will expect a spike in sales as more people on the team are working to close deals. Likewise, as sales representative quit or retire there might be a dip in sales until a replacement is found.

Changes to products or services

Whenever a business introduces a new revenue stream, releases highly-anticipated features, or restructures how offerings are bundled or priced, the changes will impact their sales forecasting methods. If a new offering enables sales reps to speed up the sales cycle or increase their win-rate, for instance, the sales forecasting methods used should reflect that positive gains.

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External factors

Market competition

The decisions and actions of your competitors can affect the outcome irrespective of the sales forecasting methods used. For example, if a major competitor of a company suddenly discounts their prices, that will impact their ability to sell at the current prices.

Market changes in supply and demand

If companies don’t pay attention to the changes around them, sales forecasting methods used can become ineffective. If there’s a growing need for the company’s product or service, that’s a sign the business can be more optimistic in their sales forecast and projected growth (especially if there’s a gap in market supply).

Seasonality

Depending on what is being sold, a company’s sales might naturally rise and fall during certain times of the year. This is different than market changes, as seasonal highs and lows occur on a cyclical basis. Since seasonality is reasonably easy to predict, it should be factored into the sales forecasting methods in order to avoid skewing the results.

The rate of inflation

For long-term forecasting, in particular, potential inflation and how it will affect costs and pricing strategies need to be accounted for.

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Market Research

What is inventory forecasting and why is it inevitable for your business?

What is inventory forecasting?

Inventory forecasting refers to defining and predicting the inventory requirements for a future time period. It can be defined as a scientific approach of predicting sales for a specified future period and is largely based on the proposed marketing plan and a set of competitive factors. Inventory forecasting techniques are highly important from a wholesaler and distributor point of view. This is because inventory forecasting forms the foundation upon which the company’s market plan and revenue projections are built. Furthermore, the accuracy of inventory forecasting models adopted by the company can have a substantial impact on the company’s profitability.

Factors affecting inventory forecasting

Some of the key internal and external factors affecting inventory forecasting include:

  • Competition
  • Technological failures
  • Reputation
  • Labor issues
  • Seasonality of products
  • Change in government laws
  • Recession
  • Inflation
  • Supply chain related factors

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Advantages of inventory forecasting

Reduced stockouts

Retailers often face the situation of stockouts wherein they are unable to meet customer demands due to shortage of inventory. An accurate forecasting method not only ensures that retailers are rightly stocked up but also the inventory idle time in the warehouse is lesser.

Better manpower management

Manpower requirements of a company increases when a business starts to grow. Having the right inventory forecasting techniques help companies to stay prepared for the inventory growth in the future by establishing appropriate manpower planning. Companies must ensure that they take measures to recruit more labor depending on the rise in demand.

Build pricing and promotion strategy

Promotion strategies that are planned and well-coordinated always yield better results. Integrated distributor-level promotions and related forecasts facilitate in ensuring better flow of goods. Consequently, the stock fill rates will also be higher.

Improve supplier negotiation

Supplier negotiations become easier when businesses are aware of the exact quantities that they are required to order. This also gives the suppliers a fair idea of the business that they can expect from the company which could prompt them to quote a better price. When negotiations are supported with data and logic, businesses position themselves as a credible customer.

Plan sales strategies

Forecasting plays a pivotal role in areas including marketing, product design planning, and product management. The data derived from inventory forecasting can be used to make decisions related to pricing, promotions, and purchasing.

Improve production cycle efficiency

The company’s present inventory is closely monitored to make forecasts for the future. Analyzing the data in hand helps identify patterns in customer behavior, giving companies a chance to plan and improve their production cycles accordingly.

Facing trouble in forecasting your inventory?

All you need are the right inventory forecasting solutions offered by a trusted market intelligence solutions provider. Request a proposal to know more about Infiniti’s inventory forecasting solutions for business.

 

Top inventory forecasting techniques

Quantitative forecasting

This inventory forecasting model is a mathematical method that is based on historical data. Here, past sales data is used as a parameter to predict the future sales. The data sets chosen can vary depending on the company’s preferences (can either be a year old data or even a decade old data) but the larger the data set the more accurate will be the results. Although this inventory forecasting technique provides a basis for predicting demand, factors such as product seasonality and unexpected peak or fall in demand could cause variations.

Qualitative forecasting

This inventory forecasting model is less precise. It predicts demand based on factors that are less measurable including market forces, potential demand, and economic demand. This method takes years of practice and experience for inventory planners before they can make accurate predictions.

Trend forecasting

This type of inventory forecasting methods is used when a particular type of downward or upward trend in involved for a product. It involves anticipating about future market trends that are most likely to have an impact on the business. These trends could either be short-term or long-term that exists over a greater period of time.

Graphical forecasting

This is concerned with converting data into a graphical representation that visually conveys a pattern. Generally, when data can be easily comprehended when they are visually represented. Using graphical representations, it becomes easier to understand data without analyzing data too much, making it simpler to make forecasts.

Inventory forecasting best practices

Some of the common best practices to follow while predicting the future demand and inventory levels include:

Observe the trends

Trends keep track of what is working in the market and what has become obsolete or outdated. By keeping a close watch on the changing trends in the market, companies can stock up on their products accordingly. This avoids the situations of understocking or overstocking. It is always advisable for businesses to not spend on low-value SKUs rather they should more focus should be given on products that are selling well.

Do not ignore data

Inventory forecasting methods need not always guarantee success. They are just an approximation and not accurate figures. However, going by the data and using statistical techniques help to reduce the uncertainty involved in forecasting inventory. So, companies must make it a point to always consider data before making forecasts for inventory.

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