Markdown Optimization

Accelerate your margin growth by optimizing markdowns throughout the product lifecycle

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Markdown Optimization

The new retail landscape isn’t static; your markdowns shouldn’t be either. Winning in the competitive omni-channel retail era requires you to excel at pricing strategies and create a path to potential margin growth. That means using more effective, optimally timed markdowns for each product that differentiates between regions, climates and stores.

Our Markdown Optimization Solution helps you maximize your overall profit by optimizing your pricing strategy for each item over its lifetime. It allows you to accurately predict seasonal demand for new products with limited history. By analyzing product attributes, price elasticities, weather and other impacts, it enables you to maximize revenues from your inventory investment.

Markdown Optimization leverages full capabilities of AI and advanced analytics to help you anticipate fulfillment opportunities for each and every product. It enables you to lower your markdown loss, achieve higher sell through, and gain visibility into end-of-season sales and inventory levels.

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Why use Markdown Optimization?

Excellent markdown-specific forecasting

Take advantage of AI-powered demand forecasts that uses self-learning markdown algorithms throughout the season.
Use sentiment-based demand sensing approaches for the best forecasting possible.
Create excellent option level markdown forecasting with a complete view of your inventory.
Maximize profits over your entire network.

Forecast using product attributes and own- and cross-price elasticity

Not all products respond to markdowns the same way. We use product attributes to estimate own- and cross-price elasticity.
Examine how your products react to price changes, estimate how much demand will increase at any given level of markdown/discount.
Monitor and learn from deviations from predicted price response.

Oversee the markdown impact for all price levels

Review the impact of the markdown at an aggregate level.
Use this information to be more proactive in your pricing strategy and to revise plans accordingly.

Optimally timed markdowns that differentiate between regions, climates, and stores

Set different optimal prices for each store cluster, region or country based on the location-level price elasticity
Take advantage of your global network to generate maximum profit from your inventory.

Use simulations and compare what-if scenarios in real-time

Test alternative business rules and objectives quickly and easily see end-of-season projections
Simulate and evaluate various markdown scenarios
Use “what if” analysis to reassess your markdown strategies and make optimized markdown decisions.

Profit-optimization throughout the season

Maximize overall profits by optimizing the pricing strategy of each item over its lifetime
Accelerate your margin growth
Act fast for products with a high risk of excessive leftover inventory
Avoid unnecessary early and deep markdowns for products / locations that will sell out
Create a successful markdown strategy that reduces your excess inventory to generate the highest maximum revenue.

Key Benefits

Lowers Markdown Loss & Increases Sell-Through for Each and Every Option

Maximizes Margins With AI-Powered Forecasting & Optimal Markdown Depth & Timing Decisions

Estimates Price Elasticity Uniquely for Each Product by Using Product Attributes

Estimates Cannibalization Effect of One Product’s Markdowns on Other Products

Offers Visibility Through the Season & End-of-Season Sales and Inventory Levels

Coordinates with Various Promotional Strategies and, What-if Scenario Evaluation

Customer Testimonials

“invent.ai's Markdown Optimization solution optimized our markdown path through the season and directly improved our margin and end-of-season sell through. invent.ai's Markdown Optimization showed significant impact on our financial KPIs starting from the first day of the implementation.”
Hakan Uğur, Chief Merchandising Officer, FLO
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"With invent.ai, we have achieved remarkable business results. invent.ai delivers speed to value, understands our operational constraints, and uniquely tailors their inventory optimization solutions to meet our needs."
Sinan Sefai, Chief Sourcing and Supply Chain Officer, Mavi
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“invent.ai's tailor-fit solution leveraging full capabilities of AI and advanced analytics allowed us to optimize our markdowns and achieve maximum profitability throughout the season.”
Head of Merchandising, Leading Apparel Retailer
Markdown Optimization Case Study
"With invent.ai, we have achieved remarkable business results. invent.ai delivers speed to value, understands our operational constraints, and uniquely tailors their inventory optimization solutions to meet our needs."
Sinan Sefai, Chief Sourcing and Supply Chain Officer, Mavi
Read the Case Study