Tuesday, September 17, 2002

Started Work on Promotion Planning and Like Modelling on APO. Did some background reading on Promotion Planning in APO.
In APO Demand Planning, you can plan promotions or other special events separately from the rest of your forecast. You can use Promotion Planning to record either one-time events, such as an earthquake, or repeated events such as quarterly advertising campaigns. Other examples of promotions are trade fairs, coupons, free-standing inserts, competitors' activities, market intelligence. Examples of events that also have an impact on consumer behavior are upward/downward economic trends, and acts of nature, such as tornadoes etc.

The advantages of planning promotions separately are:
You can compare forecasts with promotions to those without promotions.
You can correct the sales history by extracting past promotions from it, thus obtaining unpromoted historical data for the baseline forecast.
The processes of interactive planning and promotion planning can be kept completely separate. For example, the sales force might be responsible for interactive planning while marketing is responsible for promotion planning.
Promotional uplifts can be defined in units or percentages by promotion patterns. A promotion pattern that occurred in the past can be automatically detected and recreated for future periods. A promotion pattern can be archived in a promotion catalog; it can therefore be reused if a promotion of the same type is repeated.

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