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Problem
Approach
 Results

Case Study: Enhancing Promotional Effectiveness for a Fortune 500 Apparel Retail Company

The Problem

A Fortune 500 apparel retail company needed to evaluate the effectiveness of its promotional strategies across product categories to improve gross margin and other key business metrics. With a focus on the U.S. market, including online and brick-and-mortar channels, the company sought to understand the impact of category discounting on purchasing behavior, cross-category attachment rates, and overall profitability. The primary objective was to refine future promotional campaigns and empower internal teams with tools to execute similar analyses independently.

Approach

 


Data Analysis

Conducted a deep dive into daily, transaction-level data summarized by channel and product category, analyzing metrics such as revenue, units, margin, and traffic.2-Dec-26-2024-02-39-54-7941-PM

Hypothesis Testing

Tested specific hypotheses to determine the causal relationship between discounting and purchasing behavior, focusing on cross-category attachment during varying discount periods.

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Time-Lapse Insights

Performed a time-lapse analysis of discount patterns over time to identify customer-centric merchandising opportunities and cross-category synergies.

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Cross-Channel Impact

Assessed how category discounting influenced performance across channels, isolating key levers for improved promotional planning.

4-Dec-23-2024-03-36-51-4173-PM

 

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Results

Presented summarized findings in a detailed report and shared recommendations for optimizing discount strategies to enhance margins and profitability. Tools and methodologies were transferred to the company’s internal teams for ongoing analysis. By leveraging a data-driven approach, we achieved a deeper understanding of promotional dynamics, paving the way for more strategic and profitable campaigns. This initiative underscored the importance of combining analytical rigor with actionable recommendations to drive tangible business outcomes.  The project delivered actionable insights that enabled the company to:

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Rank promotional effectiveness by product category and channel, providing a clear roadmap for refining marketing efforts.

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Identify opportunities to optimize discount depth and structure to improve gross margin dollars while driving cross-category sales.

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Enhance internal capabilities by equipping teams with analytic tools and frameworks, ensuring the sustainability of similar workstreams in the future.

Estimated impact of data-driven decision-making on business performance

2-Dec-30-2024-03-42-54-3786-PM

+5% Gross Margin

Increased Gross Margin Contribution

The analysis led to a 5% improvement in gross margin across the evaluated product categories by optimizing promotional discount depth and structure.

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1-Dec-30-2024-03-43-24-3153-PM

+12% Attachment Rate

Enhanced Cross-Category Sales Performance

Implementing refined promotional strategies resulted in a 12% increase in cross-category attachment rates, driving additional revenue from complementary product purchases.

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3-Dec-30-2024-03-43-47-5272-PM

+15% Full Price Sales

Improved Full-Price Sales Ratio

Adjusting discount strategies to emphasize value-driven promotions achieved a 15% rise in full-price sales, particularly in high-margin categories like denim and sweaters.

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"At Green Retail Consulting, we pride ourselves on delivering actionable insights that drive meaningful business outcomes. This project exemplifies how a data-driven approach can not only optimize promotional effectiveness but also empower teams with the tools to sustain success. By understanding the nuanced dynamics of product categories and customer behaviors, we helped a Fortune 500 apparel retailer increase profitability while creating a framework for future innovation."
 
Yana Averbukh
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