Giancarlo Russo

Loyalty Programs & Sales Forecast Giancarlo Russo

In today's marketplace, companies ? aiming at long term competitive advantage ? have to abandon short-term goals, focused on transactions and characterized by impersonal relationships, to shift towards a two-way exchange model, ensuring a long-term relationship with the customer. The loyalty program is the marketing operational tool that allows supporting and enhancing the relationship with the customer. This is widely used not only in mature markets but also in developing countries and has reached a significant size in terms of distributed rewards. As a result, an adequate definition of the operational plans for procurement and rewards distribution is needed. Hence, an accurate demand forecast, avoiding stock out periods, excessive levels of safety stock and ensuring an adequate level of service to customers, is necessary. ?Loyalty Programs & Sales Forecast? illustrates sales forecasting methods, from the most common time-series forecasting models to demand forecast of loyalty initiatives related rewards , based on analogy and characterized by short life cycle products.