A recent article in the New York Times, “Never Mind What It Costs. Can I Get 70% Off?” quotes numerous retail experts who claim that % off deals are winning out over price rollbacks and other promotional offers across the retail industry. What’s more, according to the Times, this trend will continue. One such expert, Jeff Savitz, President of the Savitz Research Companies, and Professor of Marketing Research at the University of North Texas has developed a method for uncovering the % off discount level that will maximize profit for each and every store in a large retail chain.
According to Jeff Savitz, a graduate of The Wharton School, “We first conduct a national survey among category users and customers of a chain. We then adjust the national data to reflect the demographic profile and shopper category budget of each individual store. In the end, our model informs each store what specific discounts to feature in order to maximize profits, depending on the specific discounts its competitors display.”
Ron Shipp, former Director of Marketing Analytics for the Zale Corporation points out, “This model has tremendous value for the entire retail sector because it can be used on a real time basis at every store location in a chain, in virtually any category”.
For more information about the model, email Jeff Savitz.
