Revionics Customers Include

Retail Reflections and Recommendations for 2010

By Todd P. Michaud, Revionics President & CEO

Todd MichaudRetailers are facing continued and more focused challenges in 2010, as consumers adapt to new ways of shopping, and competitors sharpen their tactics to gain market share. Revionics helps retailers in their fight on an individual level, and also has the opportunity to look at macro trends across our entire customer base. To help you maximize your retail profitability in 2010, here are the current retail best practices and trends.

First, price wars are impacting all retail verticals.

The consumer is bombarded with offers of new low prices, deep discounts in weekly fliers, value-priced private label, rebates, coupons, and more. Retailers need to fight hard, fight fast, and fight smart. Successful retailers have carefully evaluated their products, identified their highly sensitive items (key value items), and built aggressive competitive strategies around these items. Taking a blanket approach to the competition will kill your margins and give away precious dollars where your consumers may not be sensitive. Once you identify those key items, shop the competition for those items more frequently, so as your competition changes posture, you are lock-step.

Successful retailers have carefully evaluated their products...and built aggressive competitive strategies around these items.

Second, retailers continue slashing jobs and closing stores.

This is a sure sign that retail is not out of the woods yet. In the last two weeks, there have been dramatic workforce reductions from Wal-Mart, Walgreens, and other leading retailers. The consumer has more power than ever, and successful retailers respect the amount risk associated managing consumer perception of your brand and the products you carry. Consumer demand forecasting that can accurately help retailers predict in advance how consumers will react to shifts in price strategy is essential to mitigating risk and selecting the best plan. Revionics continues to invest in new and better ways to leverage our demand management software to help retailers merchandise their stores.

In closing, I encourage you to reflect on your goals and challenges for 2010, and invite you to partner with Revionics to help you be successful. The Revionics retailer is savvy, strategic, and armed with an arsenal of tools that can and should be leveraged for an exceptionally strong year.


RAPS Collaborate – A Better Way To Manage
Your Vendor Deals

By James A. Sills, Revionics CTO

James A. Sills"Another bad UPC from a vendor! Why are we still using pen and paper to manage vendor deals?" This is a real quote from a retailer I was working with last year on a promotion planning project. This retailer was depending on the vendor’s hand-written information. The UPCs entered on deal sheets were frequently in error. "There must be a better way!"

Yes, there is a better way and help is on the way.

Revionics is on schedule to release RAPS Collaborate in April of this year. This vendor collaboration portal is a common platform for retailers and their vendors to exchange information, plan deals, and execute reporting.

Vendors submit a deal through the retailer’s branded vendor portal — by either electronic data feed or via manual entry. RAPS Collaborate is integrated with the retailer’s master of item records, so all UPCs entered by vendor are validated against the item master. Exceptions are flagged to prevent errors at the point of entry.

And that’s just the beginning.

Vendor deals that are submitted can be reviewed by the retailer for approval, or rejection with comments. There is a full audit trail, so no more after-the-fact debates about miscommunications with the vendor.

It is easy to set up new vendors or update vendor information in the Vendor Management screens. This includes setting up vendor user accounts and security. Once the vendor logs in, they can view the retailer’s master promotion plan. It is very easy to submit a deal by specifying begin and end date, UPC, incentive information, order information, terms, and special instructions. The screen allows entry of the full range of incentive options, such as bill back, scan down, lump sum, off invoice, and layered deals. When the vendor submits the deal, an email alert is automatically generated and sent to the retailer.

The next time the retailer accesses the vendor portal, they also see the alert indicating there is a vendor deal to review. Clicking on the alert brings up the vendor’s deal information. The retailer can approve or reject the deal, which generates an email alert back to the vendor.

RAPS Collaborate is fully integrated with Revionics’ solution suite, including RAPS Promotion and RAPS Replenishment. Items on deal are clearly documented and can be easily added to a promotion event, such as a circular. The incentive is accounted for in recommendations of promotion items and offers — including long term price reductions (TPRs). Reports display the impact of the incentives on the category and RAPS Replenishment takes the incentives into account in recommending forward buys.

Vendor privileges can be managed so that access is limited to only their categories and stores. They can be given access to the forecast of their items, or in the case of trusted vendors, the store-level forecast for all the items in the category.

Both the retailer and the vendor can see total trade funds by week, quarter, year, and year-to-date.

There is a full audit trail, so no more after-the-fact debates about miscommunications with the vendor.

There are additional features for managing item master data. For example, the vendor can upload nutritional information and item attributes or even propose a new item for the item catalog, which the retailer can approve or reject.

In RAPS Collaborate, Revionics is offering a compelling vendor management solution that will improve the way retailers communicate with their vendors. Sharing information in a more timely, accurate fashion will introduce new efficiencies and create clear advantages for participants. For more information, please email info@revionics.com, or reach out to your account manager for a demonstration.


Ten Pricing Best Practices that Generate Solid Returns

Contributed by Revionics Merchandising Consultant Team

Ten Pricing Best Practices that Generate Solid Returns Frank Badillo, a Senior Economist for Retail Forward in his November 6, 2009 Washington Post article stated: "Don't expect shoppers to abandon their hard-earned lessons in frugality even if the economy starts picking up. Households remain focused on shopping for needs, and this kind of cautious shopping behavior will restrain sales improvements."


So as 2010 begins, what are the best pricing practices that still generate solid returns?

  1. Track trends in customer and competitive behavior and react to trends, not single events.
  2. Engage in forward planning that utilizes forecasting tools for accurate assessment of demand shifts over time.
  3. Set goals at the highest and lowest levels. (Every member of the organization must know and understand their role in meeting the goals.)
  4. Evaluate opportunities with store clustering, customer segmenting, and predictable competitive behaviors.
  5. Plan and set specific goals for base, promotional, and TPR prices, margin targets, and even markdown price reductions. Don’t let your total margin mix, sales, and unit performance be an accident.
  6. Constantly measure your goals against your strategies. In turn, measure your strategies to ensure execution excellence.
  1. Learn and effectively apply the principles of elasticity, cannibalization, affinities, and optimization.
  2. Utilize private label as a way to maintain margin speed and provide value. Set proper gaps based on price points that are palatable to your customer.
  3. Choose the right competitors against which you measure. Who do your customers shop? Choose the right items and frequency for competitive price shops.
  4. Manage fewer Key Value Items--assess which are the most likely to cause defection if not priced right.

Don't expect shoppers to abandon their hard-earned lessons in frugality even if the economy starts picking up.


Promotions for Profitable Growth

By Ramna Sharma, Revionics Product Manager

The economic recovery has not shown the strength that the retail industry would like to see. Consumer spending, in particular, continues to be conservative as the economy slowly crawls out of its hole. Price and promotions dominate consumer's buying decision across categories. Retailers are feeling unprecedented pressure to entice consumers via heavy promotional activity. But the rush to maintain low price points, without thorough planning and analysis, can have an adverse impact on profitability. It's critical for the retailer to know exactly what, how, and when to promote. Just as important, is how to communicate their promotional activities.

Promotions for Profitable Growth

One of the key challenges for marketing and merchandising managers is inventory planning. Wild estimates or ineffective forecasting tools can easily lead to out-of-stock conditions or to over-stocking. And, unfortunately both are unpleasant. Out-of-stock situations can leave long lasting scars -- lost sales, frustrated customers, and significantly diminished brand reputations. While overstocking may seem like the simple solution, it brings its own headaches and overarching costs, defeating the whole purpose of a promotion. It is therefore extremely important for managers and marketers to understand the precise impact of a promotional activity on consumer demand.

There are various factors that determine promotion effectiveness. For example, the vehicle used to communicate the promotional message affects the number of consumers that learn about the promotion. The type of promotion and the brand being promoted affect the strength of the consumer response. Other key factors include stockpiling, cannibalization and halo effects, affinity, seasonality, and competitor promotions.

To run successful promotions that drive profitable growth, retailers must have a precise view of the consumer demand forecast. And, given all the influencing elements, this requires a powerful forecasting engine -- an engine that not only analyzes the planned promotion but also takes into consideration other parallel pricing activities, (like temporary price reductions and markdowns) to paint an accurate overall picture. Revionics takes pride in having the best-of-breed integrated forecasting engine, capable of accurately predicting demand at the item-store level. Sales promotions guided by a precise forecasting solution help retailers achieve their margin goals while keeping their customers delighted.

To run successful promotions that drive profitable growth, retailers must have a precise view of the consumer demand forecast.

Deciding what to promote also cannot be a random game. Offering a discount on an item that would sell even without the promotion is wasteful. Similarly, promoting an item that cannibalizes a high volume, high margin item also has a negative impact on profitability. Choosing the right set of products is extremely important for the success of the promotion. The forecasting intelligence of RAPS Promotion relieves managers of this herculean task by recommending items and offers that best meet the retailers' promotion objectives. RAPS Promotions saves valuable time and eliminates the unpleasant surprises of a promotion based on guesswork.

Promotions cost money - running a TV ad, printing a flyer, or setting up in-store displays - all cost retailers. Effective evaluation of a promotion, prior to execution, helps gauge the potential success of the campaign. A review of the anticipated ROI answers the question of whether or not a promotion is worth the effort and expense. RAPS Promotion demystifies this evaluation by allowing retailers to create multiple versions of an offer, optimize and forecast, and then compare their impact on the category side by side. Careful tuning of an offer aligns the promotion to the retailer’s immediate and long term revenue and profit goals.

Whether the aim of a promotion is to stimulate consumer demand or to build brand value, the planning and execution must be driven by thorough analysis, historic intelligence, and integrated forecasting – something that's core to RAPS Promotion. The ease of use and the rich feature set of RAPS Promotion sets it apart from the competition. It has been widely recognized as one of the leading promotion optimization solutions for profitable growth. The trust that the retail stalwarts have put in Revionics pushes us to continually innovate and improve.

Effective evaluation of a promotion, prior to execution, helps gauge the potential success of the campaign. A review of the anticipated ROI answers the question of whether or not a promotion is worth the effort and expense.


Pricing is Pivotal Role – Leverage our Personnel Template

Contribution from the Revionics Merchandising Consulting Team

The importance of having pricing experts with the right talent and right skills is more critical than ever. Often, retailers ask Revionics for a list of skills, accountabilities and measurements for the pricing positions. If you are thinking about adding or amending a pricing role, here are some key skills your should look for:

  • Seasoned business and retail savvy
  • Familiar with the Category Management process
  • Understanding of business strategy concepts:
    • Margin targets and margin mix
    • Price perception influencers
    • Competitive factors
    • Ending number strategies for single and multiple price points
    • Key value items
    • Category roles
  • Experience with reporting for measuring progress
  • Strong technical and process background
  • Analytical in nature
  • Comprehends operational processes and realities
  • Understands where data resides and what it means

There are several key tasks that are imperative to the pricing professional’s day-to-day role. Some of the more important expectations are listed below.

  • Work collaboratively with Revionics to provide feedback on configuration of the system for optimal recommendations that meet company goals
  • Serve as the liaison between Category Managers and Revionics , communicating requirements and requests
  • Set and maintain pricing relationships in the Revionics portal
  • Make price and strategy recommendations on a weekly basis
  • Work to position and maintain price family relationships and price-per-unit relationships
  • Manage the private label versus national brand strategy
  • Review and approve pricing for items being optimized by Revionics
  • Schedule regular reviews of accepted price results with Category Managers or Executives to consider adjustments to goals or strategies as needed
  • Facilitate executive reviews on a quarterly basis with Revionics team and retailer team

Pricing is Pivotal Role – Leverage our Personnel Template Hiring the right people with the right mix of skills and then periodically evaluating performance is a vital component of any organization’s success. How do you assess whether a pricing expert is meeting goals of the company? There are several questions one can ask when evaluating the performance of your pricing resource:

  • Are they a trusted source of pricing recommendations for the Category Managers?
  • Do they understand and support the company goals and metrics?
  • Do they understand how pricing configurations are contributing to overall results?
  • Are tactical goals built into the system to meet overall objectives?
  • Are weekly assessments of the value of price changes provided?
  • Do they distribute reports on price change forecast versus actual results and other requested information to all appropriate levels on a timely basis?
  • Do they get strategies confirmed and approved by an executive sponsor and Revionics as needed?
  • Is there verification that prices are exported on a weekly basis on time?
  • Are tasks completed/ deliverables approved within a timeline/deadline set with Revionics?
  • Are company goals met regarding the number of price changes allowed?

Hopefully, this summary provides some valuable insight into the best practices for retail pricing experts. If you would like Revionics to review, post, or circulate a job posting for your organization, we are at your service!

Hiring the right people with the right mix of skills and then periodically evaluating performance is a vital component of any organization’s success.


Revionics University – Updated Course Schedule

Customer Training: Free online training is available for customers every Friday of the month. On-demand, personalized training is also available on-request. You can view the online course schedule for February and March at www.revionics.com/training.aspx.

  • RAPS Insight Reporting Training: First Friday of every month
  • RAPS Everyday Price Optimization Training: Second Friday of every month
  • RAPS Promotion Optimization Training: Third Friday of every month
  • RAPS Markdown Optimization Training: Fourth Friday of every month
  • RAPS Replenishment Optimization Training: On-demand, by request

Free online training is available for customers every Friday of the month.

Free educational sessions are available to all interested retailers.

Industry and Merchandising Education: Free educational sessions are available to all interested retailers. A new calendar of great guest speakers and relevant topics is currently being planned for 2010. Register at www.revionics.com/educate for the following courses:

  • February 4th: Getting Back to Good, Retail Pricing in 2010. Guest Presenter: Nikki Baird of RSR Research: Revionics will debut the findings of RSR’s 2010 pricing study. Research results highlight the difference between retail winners and laggards, from organizational structure around pricing to how technology spending stacks up against your peers.
  • February 16th: Inventory Optimization: Reduce Inventory and Out of Stocks with RAPS Replenishment: Join President and CEO, Todd Michaud, and Director of Solutions Consulting, Richard Huston, for an overview of Revionics new module, RAPS Replenishment. Learn how retailers will benefit from one integrated forecast to drive store-level replenishment, promotions, pricing, and more.
  • March 4th: Increasing Pricing Sophistication, Guest Presenter Kathy Beck, Vice President, P3 Planning and Pricing and Promotions: To focus of this presentation is on how retailers can increase the accuracy and effectiveness of their pricing strategies and tactics without overwhelming their organization.

Revionics Welcomes New Retailers

By: Monty Waltz, Senior Vice President, Sales

Revionics Welcomes New Retailers

Despite the weak economy of 2009, Revionics experienced a very strong year as savvy retailers chose to invest in customer-centric applications such as price optimization. We are proud to welcome several new retailers to our customer community. Below, a few of them are highlighted.

Marsh Supermarkets, Indianapolis, IN: Known for their innovation, Marsh was the first grocery store in the world to use electric scanners when ringing up customer purchases. Marsh operates 98 Marsh Supermarkets and four O’Malia’s Food Markets, and is the largest pharmacy chain based in Indiana with over 40 pharmacy locations.

Holiday Station Stores, Minneapolis, MN: A leader in the convenience store industry, Holiday operates over 450 locations in 12 of the northern and mid-west regions of the US. They provide their customers with a distinct shopping experience, carrying a vast selection of quality food options.

Strack & Van Til, Highland, IN: Strack & Van Til, also known as Ultra Foods, operates over 30 full service grocery and fresh food stores throughout Indiana and Illinois. They guarantee the finest products at the best value in addition to providing customers with a friendly and safe environment.

Longos, Mississauga, ON: Longo’s operates 16 grocery stores with farm-fresh produce, handpicked each day at the Ontario Food Terminal. Additionally, Longo’s provides Meat, Dairy, and Frozen Food departments, as well as a quality bakery that includes cakes, pies, and other baked goods.


Business Partnerships Helping the Pricing Industry

By: Jeff Smith, Revionics EVP Business Development

Jeff Smith Revionics continues to nurture partner relationships in the areas of technology, consulting and industry analysts. The goal of these relationships is to help retailers make a seamless transition to our demand management platform.

Staying current on industry trends is very important, as is having a good pulse on the needs of the retail industry. Revionics does this by maintaining a strong relationship with the research firms AMR Research, Gartner, Retail Systems Research, IDC, and Forrester. These relationships provide valuable insight into what the retail industry is looking for, the direction they are heading, and their needs. Regular briefings from these organizations are important to learn from the research they perform, and to validate future investments.

Great examples of technology partners that provide data to enhance the optimization process include Planalytics, Retail Data and Rival Watch. Planalytics provides business weather intelligence data, which is used to tune to improve demand forecasting, or to de-weatherize historical data. Competitive data continues to be a hot topic, with Retail Data and Rival Watch working closely with retailers and Revionics. Retail Data is the preeminent provider of brick and mortar competitive price shop information in the grocery industry, and Rival Watch is a leading provider of price shop data from online sources.

Microsoft is a strategic partner and core to the delivery of our Software-as-a-Service model. Nurturing a strong partnership with Microsoft ensures that the customer community benefits directly from Microsoft’s innovation.

More partnerships will unfold with more customers, more diverse industries, and extended geographies leverage Revionics’ Price and Inventory Optimization suite. Stay tuned to announcements of new partnerships in the coming weeks.

Revionics maintains a strong relationship with the research firms AMR Research, Gartner, Retail Systems Research, IDC, and Forrester.


More Talent to Help you Meet your Goals

By: Alisa Davis, Human Resources

Revionics is pleased to announce the addition of more highly talented and experienced team members to help you meet your goals. Many of these individuals may be working directly with you or behind the scenes in technology development.

OPERATIONS AND SERVICE TEAM:

  • Ken Cline: Application Consultant: Cline will work with Revionics clients in price strategy and merchandise consulting. Prior, Cline spent five years as a Senior Business Consultant with Escalate Retail (formerly GERS Retail Systems). At Escalate, he helped clients with adoption, upgrades, and change management.
  • Erik Osborn: Application Consultant: Osborn provides valuable experience to our price strategy and consulting team. Previous to joining Revionics, Osborn was as a Senior Pricing Analyst at the Army Air Force Exchange Service, and at PetSmart both as a Replenishment Analyst and then as a Pricing Analyst.
  • Sue Dale: Senior Consulting Principal: Dale will play an important role in assisting Revionics clients in adoption and full utilization of our solution suite. Prior to Revionics, Dale was with JDA Software as a Product Director for over a decade, and with Wilson’s Leather as an Assistant Buyer, Planner and Replenishment Analyst.

DEVELOPMENT TEAM:

  • Dylan Wells Ph.D.: Senior Research Analyst: Wells joined the Revionics science team and is a valued contributor to consulting engagements and refining solution features with any statistical undertone such as market basket analysis, store zone clustering and assortment.
  • Cem Vardar Ph.D.: Senior Optimization Specialist: Vardar aids in developing advanced optimization techniques for replenishment, inventory planning and improving existing markdown, promotion and pricing optimization algorithms. Vardar was previously employed with Intel and Arizona State University.
  • John Evans Ph.D.: Senior Scientific Programmer: Evans is involved in writing, designing and implementation of Revionics solutions, including customer feature requests. Evans has an extensive background, working at Astronautics Corporation of America and Unisys.

SALES TEAM:

  • Beth Fortune-Handy: Account and Opportunity Development Manager: Handy supports our sales process in addition to managing many existing client relations. Previously, Handy worked for Oracle, selling education and training services, and Dell Computer Company, where she was responsible for several Fortune 500 accounts.
  • Richard Huston: Director, Solutions Consulting: Huston is the product expert who will perform discovery and solution demonstrations for Revionics prospects and customers. Huston was previously at Oracle as a Global Solution Architect for the Demantra product. He is APICS certified and brings an abundance of knowledge across a variety of industries to Revionics.
  • Kerry Williams: Account Executive: Williams is responsible for account management and new sales, and comes to Revionics with deep retail experience. Previous employers include JDA Software, GERS Retail Systems, and Microsoft.
  • Justin Gamble: Account Executive: Gamble is responsible for account management and new sales, with his most recent experience as s a Senior Account Manager with JDA. Gamble has a great deal of experience working in the retail industry, working with SPS Commerce, Retek, and Lawson Software.

Many of these individuals may be working directly with you or behind the scenes in technology development.


Industry Event Calendar

National Grocers Association: Supermarket Synergy Showcase
February 10th-11th, 2010
Paris Las Vegas Hotel, Las Vegas NV - Booth # 703

Retail Technology Conference
April 7th-10th, 2010
Ritz Carlton Grand Lakes, Orlando, FL

NACStech
May 5th-7th, 2010
Ernst N. Morial Convention Center, New Orleans, LA - Booth # 627

Food Marketing Institute, FMI Marketechnics
May 11th-13th, 2010
Mandalay Bay Convention Center, Las Vegas, NV - Booth # 6310

Featured Events

Panel Discussion: Trends in Pricing and Promotions for 2017

Panelists include Andres Valdivieso, CIO of Farmacorp; John Fleming, former EVP/Chief Merchandising Officer for the Wal-Mart; Sahir Anand, Principal Analyst and VP Research at EKN Research; and Cheryl Sullivan, Chief Strategy & Marketing Officer at Revionics.

View Replay

98th Annual WAFC Convention

Join us at WAFC! Our team is eager to meet you and share how our solutions are helping food chains around the globe to expand margins, increase sales, and create a sustainable competitive advantage.

Palm Desert, CA | May 6-10, 2017 | Schedule a Meeting

Revionics Insight 2017

The excitement is building for Insight 2017, a high-energy interactive event bringing together the top minds in retail for two days of networking, learning, knowledge sharing and innovative sessions.

Austin, TX | Sept 24 - 27, 2017 Save the Date!

Thought Leadership

Featured eBook | The Race for Relevance

How Retailers Can Lead in an Age of Disruption

Download eBook >>

Featured eBook | Stop Paying the Price for Bad Promotions

Download this eBook and discover how to deliver PROFITABLE promotions today.

Download eBook >>

Featured White Paper | 5 Tenets of Dynamic Pricing

Don’t Just Cut Prices, Craft Them.

Download eBook >>