Price Sensitivity Segmentation

Purpose

Make Price Sensitivity Segmentation assignments to all card identified shoppers in the timeframe of the report.

The calculation for the assignment takes into account

  • the price group of the items purchased by the household.  Items are assigned a price group of high/medium/low within each product category
  • the categories purchased by the household.

For each household we calculate the number of distinct items purchased in each category by price group.  Each purchased category is assigned a price group number based on the preponderance of item price group purchases in the category. Then the household is assigned its segment based on the preponderance of category price groups purchased.

Instance

A Quarter (3 month timeframe)

Data is Limited to..
  • TIME – all the days in the selected quarter
  • PRODuct – all items purchased
  • GEOGraphy – all stores selling in the quarter
  • SHOPpers – all card_id identified transactions where the card_id is mapped to a hh_id in the householding table.
  • Decision Metric. Household purchasing is studied to assign a high/medium/low value to the way each category was shopped; when predominantly high priced items were purchased in the category it received a high rating for that household.  Then a segment is assigned to the household based on the preponderance of that rating in the categories shopped by the household

Rows

The segments

  • Favors Low Priced Products
  • Favors Moderate Priced Products
  • Favors Premium Products

Columns/Metrics

  • #HH – Count of distinct households assigned to the segment.
  • %HH – Count of distinct households assigned to the segment expressed as a percent of the total.
  • Cume %HH – Cumulative percentage.
  • $ – Total dollar spend for the households in the segment in the timeframe of the report.  Dollar spend is the taken from the transaction log as the List Amount + Tax Amount – Markdown Amount.
  • % of $ – the Total Dollar Spend expressed as a percentage of the total.
  • Cume % of $ – Cumulative Total Dollar Spend
  • $/HH – The average dollar spend per household in the segment.
  • $/Trip – The average dollar spend per trip, or transaction.
  • Trips/Week – The average number of times a household in the segment makes a shopping trip in a week.
  • % of of Total Discounts – The discount (markdown) dollars used by this segment, expressed as a percentage of the total discount dollars used.
  • Basket Discount % – The average percentage discount realized per transaction.
  • Use of Discounts Index – 100 * (% of discounts used by the segment) / (% of households in the segment), where 100 would represent a “fair share” use of discounts.
  • Discount $ – The sum of discount  (markdown) dollars used by the segment.
  • Value Index – 100 * (% dollar spend by the segment) / (% of households in the segment), where 100 would represent a “fair share” of dollar spend.