Online Retail: Identifying the most profitable products and optimizing inventory
An online store must know the profitable products which are capable to add desired revenue to the business. This is necessary to do so that the store can decide which products should fill up the inventory. Having only such products in the inventory to make profits is the first step towards a successful online store. But how can a store realize which products are best for making profits? It needs some effective analysis and that’s what Enalito does for online retailers.
Enalito implements product clustering for an online store. It creates meaningful clusters that define the performance and status of the products. A retailer can know the interest and response towards each product by customers. It is clear that only those products are profitable for a business that make money, a lot of money. Although, the analysis of money contributed by the products can’t decide the profitable products on its own.
The product suite analyzes- Recency, Frequency and Monetary values of the products sold. The tool makes a combination of any of these attributes to form an effective product cluster. However, Enalito provides some clusters by default based on RF, RM, and FM values. The products that perform best in these clusters are the most profitable products.
From RFM point of view, the products which have:
- The best Recency and Frequency are profitable from RF consideration.
- The products with best Recency and Monetary Value are profitable from RM clustering.
- The products which sell in high frequency and produce best monetary value are the most profitable from the FM group of clusters.
Enalito suggests the best and most profitable products of the store, leaving no chance behind to miss an opportunity of selling and making profits. The inevitable truth is that only those products should be kept in inventory that contributes to the profits. This is what Enalito does for retailers with no hassle on their part.