April 10, 2019

You Can't Just Throw Quantity At The Problem

We continue to explore our problem where the merchandising team leveraged an inconsistent approach to new merchandise.

Here I analyze four-year total projected net sales ... if you had one item generating $10 you have a total of $10 ... 2 items generating $8 yields $16 in total ... applied to our dataset.

Tell me what you observe.

The data shows that you can't just throw new items at a problem ... at some point you get past 250ish new items per quarter and then total demand is unchanged regardless how many more new items you throw at the problem.

The New Marketing Leader HAS to know the answer to this riddle. She must clearly communicate to all employees the limits of merchandising strategy. This brand has a point where there's minimal return on investment for new items. Are new items important? Yes! What is most important, of course, are QUALITY NEW ITEMS.

More on the topic tomorrow.

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