Reviewing competitor’s discounting and promotional strategies can be done via the Omnilytics Dashboard. It is important to review your competitor’s discounting and promotional strategies to better understand how other brands and retailers push their products through marketing strategies, as well as ensuring that your brand stays competitive in the market. Learn how to review competitor’s discounting and promotional strategies in this article with the Calendar module.
Step 1: Analyse the Frequency and Timing of Launches
In this example, we have selected the UK market and Zara as the retailer. Now, we can start analysing the frequency and timing of the discounting launches, as well as how many SKUs of products are being dropped and put on discounts on every launch. From here, we can see that Zara has a distinct discounting and promotional strategy whereby they do consistent new product launches throughout the year and two seasonal sales. We can also observe from here that they reduce the number of new-ins every time they have seasonal markdowns.
Once we have analysed how frequent in a year the retailer does promotions and markdowns, we can deep dive further by looking into the specific timing of the markdowns. To further have a better understanding of the retailers launch strategy, we can continue the analysis by looking at First Discount by Date to see whether products are being discounted in early, mid or end of the month. This gives you a closer look at the timing of the promotions and markdowns launched by the retailer. You can also observe whether your competitors are discounting on a weekday or weekend. For example, if your competitor is discounting on a Wednesday, you may want to decide to bring up your launch to match with theirs or bring it a day earlier.
From here, we can observe that Zara put 1,818 skus of products on first time discount on the 29th of November in conjunction of Black Friday in 2019. Now, lets take a look at the discount percentages given. The products were discounted within the 40-49% ranges and this sale only lasted for 2 days, on the 29th and 30th of November.
However, an interesting observation to note is different markets have different discounting and promotional strategies, even for the same retailer. This can be seen when looking into Zara for the Singapore market, where Zara started the Black friday sale a week earlier, which was on the 22nd of November to maximise on sale, and continued with Christmast sale on December 20.
If something catches your eyes when browsing through discounting launches, you can click on any of the dates to view the products that are being discounted by different discount ranges. In this example, I am clicking on the 2oth of December and I’m able to see what products have been discounted on this date in different discount percentages. You are now able to see what are the designs and pricing of the new products. Having this information will help you decide on whether you would want to match your competitors through discounts and design to optimise sales and remain competitive.
If you are wondering what do the different shades of blue colours mean in the first discount and ongoing discount by date columns. The darker the colour, the higher the number of product SKUs. For example, when looking at the First Discount by Date column, we can see that there are two boxes that are in deep blue colour where Zara have their seasonal sales. This strategy is consistent in Zara and a common practice for retailers who do not want to be cannibalising sales on their full-priced items. Therefore, they only do discounts twice a year.
By constantly monitoring competitors’ campaign launches and own brand sales and stock performance, you could be more aware with retail market sentiments and develop a proactive tactical promotion launch strategy. A key consideration to take into account here is to identify any new campaign launches activated by competitors out of seasonal sales period.
We have now reached the end of the articles. With the steps above, you can confidently decide on when to perform seasonal markdowns and optimise discounts to get better sell-out and maximise sales. 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.