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Function documentationPromotion Cannibalization

 

Cannibalization is the impact that a new or promoted product has on the sales volume and sales revenue of existing, related products. For example, if product A is promoted, the cannibalization effect occurs when customers buy Product A instead of the regular product C. Cannibalization affects the forecast and projected sales.

The system calculates the cannibalization effects at the following times:

  • When you create a new promotion

  • When you update an existing promotion on the SAP Supply Network Collaboration (SNC) Web UI or in the inbound XML message ProductDemandInfluencingEventNotification

  • Each time a promotion is selected for updating during a Planning Service Manager (PSM) run

Prerequisites

  • You have assigned a cannibalization profile, which includes the product.

  • If you want the forecast service to calculate the cannibalization effect in a PSM run, you must select the Cannibalization Effectindicator in the Service Profile for Responsive Forecasting.

Features

To achieve the cannibalization effect, you create a cannibalization group that contains at least two products that impact each other. You must assign cannibalization factors (as a percentage value) to the products in the cannibalization group. In a cannibalization profile, you include one or more cannibalization groups. Then, you can assign this profile to location products. If a promotion is created for a product that is in the cannibalization group, the baseline forecast values of other products in the cannibalization group are reduced based on their baseline forecast and cannibalization factors.

To turn off cannibalization for a promotion, in the Promotion Planning screen on the Cannibalization tab page, choose Cannibalization On/Off.

Activities

Define Cannibalization Groups

You can define cannibalization groups in the SAP SNC Web UI by choosing one of the following:

  • Start of the navigation path Promotions Next navigation step Assign Promotion Parameters Next navigation step Cannibalization Group End of the navigation path

  • Start of the navigation path Promotions Next navigation step Promotions Planning Next navigation step Cannibalization End of the navigation path tab page

For more information, see SAP Library for SAP Supply Chain Management at http://help.sap.com/scmInformation published on SAP site. In SAP Library, choose Start of the navigation path SAP Advanced Planning and Optimization Next navigation step Demand Planning Next navigation step Demand Planning Process Next navigation step Promotion Planning Next navigation step Cannibalization Group End of the navigation path.

Define Cannibalization Profile

To define a cannibalization profile, in the SAP SNC Web UI, choose Start of the navigation path Promotions Next navigation step Promotions Parameters Next navigation step Maintain Cannibalization Profiles End of the navigation path.

Display Cannibalization Data

In the SAP SNC Web UI, on the Promotions Planning screen, you can display cannibalization information in the following tables:

  • In the Promotion Item table, promotion items are displayed with cannibalized items and cannibalization factors.

    The cannibalized items are identified by the selected Cannibalization On checkbox.

  • In the Promotion Planning data table, cannibalized promotion items are displayed.

    In the View field, select Cannibalization to display the cannibalized baseline for the cannibalized items.