US 7,072,848 B2Granted

Promotion pricing system and method

AssigneeManugistics, Inc.

InventorsDean Weldon Boyd, Prashandt Narayan Balepur, Henry Frederick Schwarz, Philip David Reginald Apps, Ravishankar Venkata Nandiwada, Brian Lawrence Monteiro, Thomas Edward Guardino

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Abstract

A promotion pricing system produces an evaluation so as to analyze, evaluate, improve, and design promotions. The promotion pricing system generates promotion price evaluations and recommendations for each promotion related to a target product, along with analyzing competing products from the same seller and its competitors. The computerized promotion pricing system includes modules for carrying out necessary analytical steps, where the modules cooperate to implement a statistical market response estimation that provide statistically stable information on customer response to promotions using either an attractive or a multiplicative model, where the model is selected dynamically. The modules include a product segmentation module, an incentive translation module, a customer segmentation module, a data aggregation module, a model selection module, a calibration module, an evaluation module, a constraints generation module, a cost structure module, an optimization module, a market channel performance module, and an alert module.

Claims18

Dependent claims

A method for evaluating a promotion scheme for a product, the method comprising the steps of:

providing a computer to a user;
said computer collecting market data related to said product to create a model of a market for the product, wherein said market model identifies at least one competing good, and wherein said computer defines customer segments for said product and said competing goods in said market model, and wherein said customer segments are statistically independent such that a sale to one of the customer segments does not effect a demand from others of the customer segments,
said computer collecting historical transaction data related to transactions of the product and the competing goods in the consumer segments during at least a first and a second time period;
said computer analyzing the historical data and dynamically selecting a statistical model to evaluate said promotion scheme, wherein said computer selects a multiplicative model when the computer determines during the analyzing of the historical data that:
(a) the historical transaction data satisfies a predefined completeness criterion,
(b) sales of the product and sales of the competing goods are statistically dependent,
(c) sales of the product and the competing goods during the first time period are statistically dependent on sales of the product and the competing goods during the second time period, or
(d) a number of the product and the competing goods exceeds a predefined number criterion, and
wherein said computer otherwise selects an attractive model and
said computer using said statistical model to analyze the historical data and the market model to determine a utility of the product without the promotion scheme;
and
said computer using said statistical model to estimate a change in utility of the product from the promotion scheme.

9 more elements

A computer-executable program storage medium tangibly embodying a program of instructions to perform a method for evaluating a promotion scheme for a product, the method comprising the steps of:

collecting market data related to said product to create a model of a market for the product, wherein said market model identifies at least one competing good, and wherein said market model defines customer segments for said product and said competing goods in said market model, and wherein said customer segments are statistically independent such that a sale to a first customer segment does not effect a demand from a second customer segment,
collecting historical transaction data related to transactions of the product and the competing goods in the customer segments during at least a first and a second time period;
analyzing the historical data and dynamically selecting a statistical model to evaluate said promotion scheme, wherein a multiplicative model is selected when the analysis determines that:
(a) the historical transaction data satisfies a predefined completeness criterion,
(b) sales of the product and sales of the competing goods are statistically dependent,
(c) sales of the product and the competing goods in the first and the second time periods are statistically dependent, or
(d) a number of the product and the competing goods exceeds a predefined number criterion, and
wherein otherwise an attractive model is selected;
and
using said statistical model to analyze the historical data and the market model to determine a utility of the product without the promotion scheme;
and
using said statistical model to estimate a change in utility of the product from the promotion scheme.

9 more elements

Dependencies are inferred from the claim text.

Facts

Application: 09/987,706Filed 15 Nov 2001 · us provisional application
Priority: 15 Nov 2000
Published: US 2002/0123930 A15 Sep 2002
Granted: 4 Jul 2006
Term ends: Not estimatedThe source records don’t support an estimate.

Classification8 codes

G06Q 30/02
Commerce: marketing; Price estimation or determination; Fundraising
G06Q 30/0202
Market modelling; Market analysis; Collecting market data: market predictions or forecasting for commercial activities
G06Q 30/0206
Market modelling; Market analysis; Collecting market data: price or cost determination based on market factors
G06Q 30/0207
Marketing; Price estimation or determination; Fundraising: discounts or incentives, e.g. coupons or rebates