With U.S. retailers planning to spend nearly $10 billion on advertising this year and cross-industry ad spend projected to approach $240 billion, those outside of advertising agencies often wonder whether or not their companies are throwing away good money on print, broadcast, direct mail and Web promotions.1 Yet, many retailers today rely on beliefs, perceptions and emotions, rather than fact-based promotion management approaches that deliver more predictable and repeatable returns on advertising investment.

John Wanamaker (one of retail's early innovators who is credited with establishing the first department store and pioneering the use of price tags, money-back guarantees and newspaper ads) once stated that half of his retail advertising was ineffective; he just didn't know which half! Today, retailers need not face Wanamaker's dilemma. With POS scanning, real- time inventory visibility, availability of store-level daily item sales and profitability information, as well as sophisticated data mining tools and techniques, no retailer should be in the dark regarding the effectiveness of individual or aggregate promotion campaigns. Advertising plays an important role in building and retaining brand equity for retailers, but it can contribute much more than that. Effective promotion management is capable of driving increased exposure (footsteps, clicks and dollars) into a retailer's existing asset base in a profitable manner.

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