How AI-Powered Supply Chain Optimisation Can Supercharge Your Holiday Season Success

Promotional planning serves as a strategic framework for retailers to increase sales and drive revenue. Effective promotions help retailers achieve several key objectives, such as clearing excess inventory, acquiring new customers, increasing customer loyalty, and capitalising on peak shopping periods like holidays and festivals.

Artificial Intelligence (AI) and machine learning-based algorithms play a pivotal role in enhancing promotional planning for retailers. With AI, retailers can precisely target their promotions to the right audience, optimise pricing strategies, and suggest personalised products to customers while ensuring optimal inventory levels. Additionally, AI can help retailers predict demand, optimise inventory levels, and assess the impact of different promotional strategies through techniques like price elasticity modelling.

There are three main pillars of machine learning for promotional planning during the holiday season:

1. Demand Forecasting: Demand forecasting enables supply chain professionals to predict how demand for products will fluctuate during the holiday season. This includes analysing various factors like historical data, market trends, and external events that may impact demand. The key here is to use the right drivers for model inputs, such as price and promotional day indicators.
2. Price Elasticity Analysis: Leveraging price elasticity modelling to determine how changes in pricing affect product demand is highly effective. It helps in setting optimal prices during promotions and sales and implementing dynamic pricing strategies. Additionally, it enables supply chain professionals to adjust prices in real-time based on demand fluctuations and competitor pricing, maximising revenue while remaining competitive. Using price elasticity data to determine which products can be discounted, how much to discount them, and the best timing for promotions helps achieve maximum impact.
3. Inventory Optimisation: Use demand forecasts and price elasticity insights to optimise inventory. Make data-driven decisions about how much stock to keep for each product, ensuring there is enough to meet demand without overstocking. Price elasticity models can also assist with markdown strategies for excess stock items in need of clearance.

At TrueGradient, we have developed an interconnected AI platform that can be utilised to create end-to-end promo strategies using state-of-the-art algorithms. By leveraging AI tools like TrueGradient for demand forecasting, inventory planning, and promotional planning, you can make your supply chain more agile, responsive, and efficient during the holiday season. This data-driven approach will help you meet customer demand, maximise revenue, and provide a seamless shopping experience.

Reach out to us at TrueGradient for a personalised consultation to elevate your success this holiday season.