Promotional Item Selection

Large retailer and food distributor increases basket sales from weekly promotional flyer

Client profile

Client
Retailer and Food Distributer

Products
Promotional Item Selection

Industry
Grocery

Location
United States

A Fortune 400 company and one of the largest food distributors in the United States leverages Daisy’s Promotional Item Selection solution to increase basket sales from their weekly promotional flyer. Currently, they operate more than 120 stores across the United States.

The challenge

The retailer was looking to drive larger basket sales from their weekly promotional flyer. They recognized that in order to achieve this they needed an optimal mix of products in the flyer. There were some challenges in getting departments to select items that would achieve the results they were aiming for.

Our solution

Recommendations from Daisy’s Promotional Item Selection solution helped drive the optimal promo product mix for the flyer. To make the selection process easier for Category Managers, Daisy complemented our product ranking with the introduction of a stop sign color scoring mechanism. A color of green, yellow, or red was applied to all promotional recommendations based on how far the item was from the optimal recommendation – thresholds for scoring were specific to each department.

  • GREEN: Everything that is recommended and all lines that are better than the worst line in our recommendations in terms of relative index (i.e., the relative strength of one recommendation versus another. The best product group with a Daisy Rank of 1 has a relative index of 10,000).
  • YELLOW: Everything that’s within 20% of the worst line in our recommendations in terms of relative index.
  • RED: Everything else.
Category Managers were directed to steer towards green items when planning the flyer. The more green selections in the flyer meant the closer they were to picking highly ranked items and driving greater sales.

Some additional pointers were also provided:

  • Reserve most prominent ad placements for the best driver items: top ranked items drive the most incremental transactions.
  • Do not overpromote and remove ineffective promotions: there is no need to promote the whole solution (entire use case).
  • Ensure Category Managers leverage the portal and rankings.
  • Balance between vendor funding/contracts and Daisy recommendations.

Results:

The introduction of the color scoring provided more parameters for Category Managers to circumvent. As long as they were picking “green” items for promotion, they would be aligned to Daisy’s recommendations.

7X Increase in Promo Sales Lift
By working with Daisy to optimize their promotions, the retailer experienced an average promo sales lift of 7X compared to the bottom 25 items.
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