Decomposing the impact of sales promotions on a large scale retailer’s business performance

Ömer Zeybek*, Tolga Kaya, Burç Ülengin, Işıl Öztürk

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

Abstract

Promotion, one of the 4Ps of the marketing mix notion, is an essential component of marketing eco-system. Although originally, sales promotions were positioned as short-term actions to receive immediate increases in sales, nowadays, marketers recognise them as integral tools of creating sustainable sales performance. Yet, promotions’ link with different key performance indicators of the business system makes the task of distinguishing the net value added a hard job. A recent study indicate that 20% to 50% of promotions generates no noticeable lift in sales or worse. In this paper, we employed store level transactional data, provided from the database of a large scale national Fast Moving Consumer Goods (FMCG) retailer, to test the impact of sales promotions on business performance. Primarily, repetitive patterns such as seasonality are investigated. Afterwards, a time series model is established to capture the change in the volatility of sales with respect to the total number of products in promotions. Results suggest that, the total number of stock keeping units (SKUs) on promotions have a significant effect on a retailers’ overall sales performance and should be used as an input for decision models and support systems aiming at optimising the components of marketing activities.

Original languageEnglish
Title of host publicationIntelligent and Fuzzy Techniques in Big Data Analytics and Decision Making - Proceedings of the INFUS 2019 Conference
EditorsCengiz Kahraman, Sezi Cevik Onar, Basar Oztaysi, Irem Ucal Sari, Selcuk Cebi, A.Cagri Tolga
PublisherSpringer Verlag
Pages464-471
Number of pages8
ISBN (Print)9783030237554
DOIs
Publication statusPublished - 2020
EventInternational Conference on Intelligent and Fuzzy Systems, INFUS 2019 - Istanbul, Turkey
Duration: 23 Jul 201925 Jul 2019

Publication series

NameAdvances in Intelligent Systems and Computing
Volume1029
ISSN (Print)2194-5357
ISSN (Electronic)2194-5365

Conference

ConferenceInternational Conference on Intelligent and Fuzzy Systems, INFUS 2019
Country/TerritoryTurkey
CityIstanbul
Period23/07/1925/07/19

Bibliographical note

Publisher Copyright:
© 2020, Springer Nature Switzerland AG.

Keywords

  • Market response models
  • Sales promotions
  • Time series modelling
  • Volatility modelling

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