Andreas Willgert, Co-Founder and CEO, FormulateAndreas Willgert, Co-Founder and CEO
Promotions are key to retail. Typically 20 to 40 percent of retail revenue is generated on promotion. But promotions are also expensive and inefficient, especially for bricks-and-mortar retailers. Consider a national supermarket chain that runs hundreds of different promotions every week. Tracking promotion performance, optimising to maximise basket size or footfall, and creating actionable insights to improve future campaigns, is simply beyond the means of most commercial teams. As a result, on average, 40 percent of promotions do not increase category sales, 30 percent do not lift product sales, and a full 50 percent hurt the bottom line. This is a hugely costly problem in need of an urgent solution.

Swedish technology company Formulate provides it. Combining data science and retail expertise, Formulate offers large retailers the tools to plan, optimise, and evaluate their promotions across every product and in every store. Using Formulate, retailers can review campaign performance to understand which promotions worked and which did not, simulate ideas with highly-accurate feedback on how the promotion would perform in practice, and construct a full promotion plan to fulfil specific objectives, like driving profit, volume, footfall, basket size, or some combination of the above.

Whereas most enterprise solutions require complex integrations and a lengthy onboarding, Formulate is lightweight and adaptable, providing retailers with actionable insights in weeks rather than months. “We are focused on delivering a scalable plug-and-play solution”, says Formulate CEO Andreas Willgert. “We provide a web application for commercial users and an optional data layer for analytics teams, who can enhance their own business intelligence analysis with everything Formulate has to offer.”

We help our clients secure double-digit profit growth on promoted items, save hundreds of hours on promotion management, and significantly reduce waste through quality forecasting

This approach has served Formulate well, and they currently count the largest grocery, convenience, and pharmacy retail chains in the Nordics amongst their customers. “Now, it is clear we help our clients secure double-digit profit growth on promoted items, save hundreds of hours on promotion management, and significantly reduce waste through quality forecasting, we are excited to introduce our solution to retailers across the world”, says Willgert.

So, how exactly do they do it? Put simply, Formulate imports raw retailer transaction data, enriches it with external data to improve forecasting accuracy, and uses AI to run billions of statistical models that analyse promotion performance. Formulate then provides actionable insights and recommendations that commercial teams can implement at their discretion. “We want the solution to be useful for every retail professional that seeks to make better decisions— not just statisticians or data scientists,” states Willgert.

Formulate is made for retailers that lack the in-house technical capabilities of Amazon or Alibaba, but recognise the central role AI will play in the future of retail. Learn more at Formulate.app.