Typically, if a brand or retailer still has remaining stock after a promotion, the product will enter a markdown.

Markdown refers to a more straightforward discount given for particular products, either seasonal or clearance. Seasonal sales usually enter staggered markdowns where deeper discounts are applied for ageing products. However, certain slow-movers can also be added directly into a sale or clearance event, without having to go through the first phase of promotions.

There are two types of sales:

  • Seasonal Sale
  • Clearance Sale
A Seasonal Sale

Seasonal sales activation are usually held twice a year. The preparation steps required for planning a seasonal sale are not that different from planning tactical promotions, although more consideration needs to be taken into account, such as existing discounted, aged stocks and overall inventory level.

The sell-through rate and the stock balance for the markdown will determine the depth of the discount for each individual product for seasonal sales. The result is what is usually seen at a sale event, where the discount usually starts with a 30% discount, followed by the next level with a 50% discount and a 70% discount.

Here are some key steps to execute a seasonal sale:

  1. Identify key market events
  2. Identify own & competitor sales launch strategy (launch frequency & strategy)
  3. Review past performance of key market events timeline vs. sales launches
  4. Determine the right timing to launch seasonal sales
  5. Identify competitor’s highly markdown driven category
  6. Review own brand slow-performing/aged category
  7. Determine product assortment to markdown
  8. And lastly, consistently track seasonal sales and promotions sell-through on a weekly/monthly basis.
Conclusion

Doing research and strategising before executing a seasonal sale will help brands and retailers to activate the right discounts in order to achieve the goals of the sale. Seasonal sales are often the solution to clearing out old stocks and returning current inventory to a healthy state, paving the way for upcoming new-ins.

We hope you found this article helpful! If you have any questions or would like to explore the Omnilytics dashboard further, feel free to reach out to your respective Client Success Manager.

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