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A new mechanism for identifying indispensable products and their optimal replacement

IP.com Disclosure Number: IPCOM000241232D
Publication Date: 2015-Apr-07
Document File: 7 page(s) / 225K

Publishing Venue

The IP.com Prior Art Database

Abstract

In current retail industry, we are always facing some phenomenon that some products seems to be very important that most of the customer coming to the brick & mortar store is because of it, but few of the retailer pay enough attention to it, this disclosure is aiming to describe a new mechanism which can easily identify the indispensable products for better sale, and also make a optimal replacement for the indispensable product when lack of inventory

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A new mechanism for identifying indispensable products and their optimal replacement

An excellent retailer usually widely known as selling great variety of goods. If some products, especially for some commodities out of store will reduce profit, worsen consumer experience or decrease consumer retention rate. Retailers are conscious of this. The problem is it's hard for retailers to find the indispensable products precisely and often make the indispensable products out of store . Even the indispensable product out of store, it is hard for retailer to find a replacement to keep the consumer.

A system is required by retailer to help them identify indispensable product, this is good reference for procurement making their procurement strategy. This system would recommend some replacement when the indispensable products are out of store simultaneously.

Retailers have plenty of members' information and POS daily data, by analyzing the big data with a new mechanism, the key products which are bringing profits and acting catalyzer role will be reached. After knowing these indispensable products, procurement management will add these products to purchase list with higher priority.

The main points of this disclosure:


1. Identify the indispensable products by analyze membership data and POS daily data with a new mechanism.

2. Find the optimal replacement base on elasticity and margin maintenance when the indispensable products out of store.

This invention has following advantage:

1. Through the scientific and reasonable data analysis, retailers will know which products are the real indispensable products.

2. After procurement management knowing the indispensable products, they will try to promise the products were supplied, then retailer would get stable profit.

When the indispensable products out of store, retailer will know the replacement products and refer them to consumers, this could keep consumer there and increase consumer retention.

Solution

Solution:

:

1. After consumer paid for the selected product, consumer will get a shopping list or receipt, this list show what consumer has brought from stores, and retailer also saved the information to DB, the information is named POS daily data.

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2. Many consumers have registered as a member of retailer, so the retailer has the information of members.

3. Retailers collect all POS daily data and membership data, then input the data to a data analysis model 1 to find product profit contribution rate, product consumer retention rate and other metrics like Quarterly Average product profit contribution rate with key product, Quarterly Average product profit contribution rate without key product, Quarterly Average product consumer retention rate with key product and Quarterly Average consumer retention r...