Pricing and Promotion Solution became client’s “saving grace.”
One of our clients, a U.S.-based consumer electronics retailer, had started to run more complex promotional offers including the combination of multiple promotional offers. Historically, this client was losing millions in revenue due to setup and system-related errors. In order to reduce those errors and still be able to run multi-level promotions, their Promotional Pricing Team deployed hacks/work-arounds leveraging a customized utility not intended for promotions. This process proved to be convoluted and often failed while causing other problems and significant margin erosion.
E3 Retail and their client joined forces to deliver E3’s ADVANTAGe Price & Promotions Management Solution. The E3 Retail development team, including the CEO, became immersed into the client’s business seeking to understand the day-to-day issues and the processes around promotional pricing management. E3 Retail brought a flexible approach to implementing this tool that did not burden the client’s cross-functional project team with traditional waterfall methodology. Through an iterative process, UI designs and functional requirements were frequently passed for approvals and changes were quickly implemented.
The Promotions Manager Tool (PMT) allowed the merchant team to setup all promotional offer types for all customer touchpoints in one place, i.e. instant savings, bundles, free items, coupons, finance offers, etc. The workflow feature in the tool allows a user to quickly find what they need to tackle based on an assigned priority. They were able to control (by merchandise hierarchy) how large of a discount an item should receive within the tool – this reduced the level of concern that the discount may be in error. This also ensured they find large errors in setup prior to the promotion going live. The best feature of PMT is that it would not allow the user to enter something that could not be executed by the Pricing Engine.
The Pricing Simulator allowed the client’s Promotional Pricing Team to pre-test promotional offer discounts on a system that mimicked POS on their laptops. This pre-testing allowed the inspection of offers for current dates, past dates, or future dates. Because of this, the team was able to proactively find many issues which proved to instill confidence that their offers would be executed as planned. The director of the promotional pricing team’s life went from putting out fires related to the issues to taking on additional capabilities and teams – she actually called the Pricing Simulator her “saving grace”.
The last two components were the Pricing Publisher and the Pricing Engine. The Pricing Publisher allowed the client to publish promotional details that included pricing and savings amounts to various customer touchpoints. The legacy systems took two+ hours, and sometimes overnight, to update an offer price. With the Pricing Publisher, the client was able to update promotional pricing near real-time giving them the ability to quickly change an incorrect price or swiftly react to the market and have confidence that the in-store sign, POS, and online prices were aligned; this was all attributed from data being fed from one source opposed to many disparate systems.
The Pricing Engine allowed our client to work with their vendors to create offers without worrying about whether the promotional offer would be executed correctly. If it was required that a promotional offer be stacked/combined with other promotional offers, owing to the Pricing Engine, that task could easily be accomplished. If promotional offers were not to be stacked/combined that could be easily configured and accomplished as well.
Although the Pricing Engine was extremely complex, E3 Retail made it easy to understand the logic, through the PMT and the Pricing Simulator, which created ease of training, utilization, and support. Thankfully, store associates were no longer required to spend countless hours calling into the help desk for support; the Pricing Engine always applied the right price. The PMT was fully deployed as well as the integration of the Pricing Simulator and the Pricing Publisher within a few short months of undertaking the project. The Pricing Engine was piloted at POS in a few stores over the holiday retail season before the full planned rollout was completed early spring.
This electronics retailer garnered a 50% reduction of errors in the first year after initially deploying the solution. Two years later, they realized an 80% reduction which resulted in saving over $6M annually in revenue due to the more preemptive approach in finding setup errors. The Promotional Pricing Team was able to shift 50% of the team’s headcount to other open roles in the company due to the efficiencies gained through E3 Retail’s ADVANTAGe Price & Promotions Management Solution.
The result of a survey sent to internal employees disclosed that E3’s Promotions Manager Tool ranked in the top percentage of tools for having the best training documentation, ease of use and support. The client no longer needed to create work-arounds or spend time explaining what went wrong, but instead, increased their partnership with E3 to further identify areas of opportunity and educate end-users.
The E3 Retail team was able to rapidly gain understanding of their business model, continually listen to their needs, and proactively improve their systems to support and enhance their many business processes. This working partnership continues through this day .