DemandTec

Market Basket Profile Analysis
Helps retailers understand which consumer purchasing behaviors drive larger, more profitable market baskets.

Customer Segmentation Analysis
Enables retailers to create a new segmentation scheme or refine an existing one to better target their customers.

Affinity Analysis
Helps retailers determine the probability of a follow-on purchase to improve their merchandising and secondary placements.

Image Item Analysis
A llows retailer to enhance their price image by analyzing item and basket-level data to determine key items by chain, store, or customer segment.

Zone Analysis / Store Clustering
Helps retailers analyze customer segments, store-level demand and geo-demographic factors to create or reconfigure ad zones that improve volume and profit potential.

Better Understand Customers Through Segmentation

The foundation of every effective merchandising and marketing program is a fundamental understanding of how a retailer’s heterogeneous customer base breaks down into homogenous segments that can be communicated to a more targeted way. DemandTec services and partner-delivered services enable retailers to identify and segment customer groups based on purchasing behavior, as well as geodemographic and behavioral characteristics, in order to create more effective marketing and merchandising strategies. With these insights, retailers can better understand how their second and third tier customers differ from their best customers, and how they can transition them into becoming their best customers. Retailers can also model customer attrition in order to develop retention and loyalty programs executed via direct mail, online, coupon, in-store, or other vehicles. Retailers can also share their segmentation information with vendors to collaborate on more effective promotions.

Design Store Clusters to Localize Merchandising

Customer segmentation and targeted marketing can go all the way down to a one-to-one level, resulting in millions of unique flyers customized for different households. For in-store pricing, promotion, and assortment decisions, however, there are practical limits on how granular a retailer can get. A well-designed store cluster strategy allows retailers to localize merchandising decisions based on where key customer segments shop while maintaining supply chain efficiencies and managing other practical constraints. DemandTec Marketing includes services to help retailers create optimal store clusters and ad zones based on store-level demand intelligence, geographic and demographic factors, and customer segmentation strategies.

Develop Segment-targeted Merchandising Programs to Increase Sales and Enhance Differentiation

With cohesive customer segmentation and store clustering strategies in place, retailers can use DemandTec Marketing to make segment-based pricing, promotion, and assortment decisions based on where key customer segments shop. Known-Value Item (KVI) lists, product affinities, price elasticities, and ad and display effectiveness may all vary by segment. By optimizing merchandising plans targeted for particular segments, or at least with an understanding of how price, promotion, and assortment decisions will impact the best customers, retailers can increase sales and other category metrics while also building long-term customer loyalty.

Gain New Insights into Customer Loyalty

DemandTec Marketing includes a platform for consumer-centric decision making, combined with advanced analytics and expertise from Precima, to help retailers gain new insights into customer loyalty. For example, the combined solution enables retailers to analyze market baskets and product affinities to understand the categories, brands, and items that are associated with the purchasing behavior of retailers’ most loyal and most profitable customers. It also enables retailers to perform detailed analysis of customer loyalty data to identify behavior that is predictive of customer attrition, and apply prediction factors to existing customers to identify customers that are “at risk” of defecting.

Execute One-to-One Marketing Campaigns Aligned with In-store Merchandising Tactics

In order to deliver a comprehensive solution for integrated merchandising and marketing, DemandTec works with Precima, an advanced analytics firm for customer insights, to enhance a variety of services within the DemandTec Marketing™ solution. In addition to segmentation expertise and customer insights expertise, Precima can help retailers apply new customer insights to improve the effectiveness of their frequent shopper programs and create effective one-to-one communications via email, direct mail, and other mediums to further enhance customer loyalty and increase sales. To integrate one-to-one marketing with in-store, segment-targeted merchandising, DemandTec and Precima can work with retailers to design an integrated plan and measure category- and customer-specific results.