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The 3 A’s behind user behavior in the demand planning process

By Pawan Murthy, Senior Director of Marketing, Prevedere; Luke Shave, Senior Industry Marketing Manager – CPG & Retail, Microsoft on February 26, 2018

Filed under Retail & Consumer Goods

Happy sales associate hands shopping bag to customer in clothing store

Consumer goods and retail marketers spend a lot of time, money, and effort on the four “P’s”—product, price, place, and promotion. And with good reason, as these are the focus areas that attract customers to a product. Yet no matter how refined a product is, or how much testing is done before launching a promotion, the four “P’s” do not help companies accurately anticipate consumer demand. Retailers need a solution that considers the multitude of external factors that also affect a company’s performance and the demand planning process. Brands could further benefit from integrating the three “A’s” of consumer behavior, which provide a more holistic view of their customers than the four “P’s” alone.

The 3 “A’s” of consumer behavior

Affinity The first key to influencing customer purchases is affinity, or consumer trust. A recent study by KPMG found that 74% of consumer and retail executives surveyed globally found trust and loyalty to be ‘very’ to ‘critically’ important to their success.1 Conversely consumers are not as likely to purchase a product where they’ve had a bad experience. This is primarily why retailers focus on the 4 “P’s” and spend a lot of time working hard to get the product just right—to improve upon their affinity with customers.

Ability Consumers may be as loyal as they’ll ever be towards a particular brand, yet they won’t buy if they do not have the means to do so. There are several factors that dictate a consumer’s ability to spend (and therefore buy), such as hourly earnings and average weekly hours worked. Unsurprisingly, these metrics show that the more a consumer works and earns, the more discretionary income they could spend on non-essential items. Retailers who take into account factors that affect ability, such as employment, earnings, and costs consumers incur have better insight into their actual capacity to buy.

Attitude Consumers may have loyalty, and may have the ability to buy products/services, yet it might not be enough for them to purchase a product. Unexpected external factors may play a large role in consumer behavior. Personal, financial, social, economic, and political confidence are all examples of external factors that could prevent them from buying. For example, personal savings rate is the third leading indicator that reflects the health of the retail industry. Based on this, one may think it leads to more spending. However, instead, purchases usually decline, as consumers’ saving leads to lowered confidence in their personal situation, or their outlook on the economy. Leaders in retail will be able incorporate nuanced consumer behaviors such as attitude in the demand planning process for their products.

By considering the three “A’s” retailers gain a more complete view of consumer behavior, which ultimately help them gain a clear understanding of future performance.

Achieve more accurate forecasts

Prevedere, an industry insights and predictive analytics company, has partnered with Microsoft to uncover the three “A’s” that influence consumer behavior and provide actionable data driven insights at the speed of business. ERIN, their patented analytics engine (using Microsoft technology) combines external global factors with internal company performance to provide: validation of a company’s current strategy, discovery of hidden performance drivers, a 360 view of future demand, and optimized ROI on operational spend.

To learn more about Prevedere, try the demo of their Demand Planning solution built on Microsoft Cloud technology on, or contact a sales representative today.


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