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  System and method for administering promotionsUSPTO Application #: 20060041475Title: System and method for administering promotions Abstract: A system for administering scan-based promotions involving manufacturers and retailers. The system records the terms of the promotion, ensures that the promotion is conducted in compliance with the agreed terms, settles the promotion and provides continual promotion progress for review by the retailers and the manufacturers. (end of abstract) Agent: Brinks Hofer Gilson & Lione - Chicago, IL, US Inventors: Thomas J. Sullivan, Richard J. Windish, Dorr H. LeWright, Joseph M. Trattner, Suzanne K. Arenson, George Colunga, Kathy S. Hackett, Joica C. Campbell USPTO Applicaton #: 20060041475 - Class: 705014000 (USPTO) Related Patent Categories: Data Processing: Financial, Business Practice, Management, Or Cost/price Determination, Automated Electrical Financial Or Business Practice Or Management Arrangement, Distribution Or Redemption Of Coupon, Or Incentive Or Promotion Program The Patent Description & Claims data below is from USPTO Patent Application 20060041475. Brief Patent Description - Full Patent Description - Patent Application Claims
PRIORITY CLAIM [0001] This application is a continuation of, claims priority to, and claims the benefit of U.S. patent application Ser. No. 09/385,489, filed Aug. 30, 1999, the entire contents of which are incorporated herein. DESCRIPTION [0002] The present invention relates in general to a system and method for administering promotions, and in particular to a system and method which captures, records, tracks, reports, monitors, verifies and settles product promotions for retailers and manufacturers. BACKGROUND [0003] Product manufacturers and retailers have run or been involved with a variety of promotions to sell their products. For purposes of this application, "manufacturers" include manufacturers, distributors, suppliers, brokers and vendors of products such as consumer packaged goods. For purposes of this application, "retailers" include retailers and other businesses which sell products such as consumer packaged goods on a wholesale or retail basis to customers or consumers, e.g., supermarkets, mass merchandisers and chain drug stores. [0004] One type of promotion is generally known in the industry as a "consumer promotion" or a "direct promotion." One of the most prevalent "consumer promotions" involves promotions where the manufacturer sets the terms of the promotion, prints and distributes coupons directly to the consumer (through a number of methods or agents, such as free-standing inserts in newspapers or magazines, direct mail, on-package coupons or in-store). The consumer receives a discount on the price of the purchased product when the consumer presents the coupon to the retailer at the time of purchase. The retailer treats the product sale as a "full price" sale on its books and does not realize the full cash value of the sale until the manufacturer reimburses the retailer for the coupon. The retailer usually does not have much input into the nature, terms or conduct of such promotions. The retailer essentially acts as a conduit between the manufacturer and the consumer for handling, honoring or processing the manufacturer's discount to the consumer. For the most part, such promotions are planned for and delivered to the consumer without the input of the retailers (i.e., the manufacturers establish the promotion region, the terms of the promotion, the products to be promoted, the time period for the promotion and various other promotion terms). [0005] Another type of promotion is generally known in the industry as a "trade promotion" or an "indirect promotion." Most "trade promotions" involve promotion funds the manufacturer pays to the retailer. The retailer may or may not pass along these funds to the consumer. [0006] In one form of trade promotion, the manufacturer presents promotion funds to the retailers in the form of off-invoice allowances. Specifically, the manufacturer sells cases or large quantities of the promoted product to retailers at a reduced cost. The terms of this type of promotion are set by the manufacturers, and the manufacturers usually offer these promotions equally to every retailer. [0007] In other forms of trade promotions, the retailer is more involved in customizing or creating the trade promotion. This is due, among other things, to: (1) the frequent shopper, advertising, display and scan-down programs where retailers tailor their promotions to distinguish themselves from other retailers; (2) the substantial emphasis on performance under or results of the promotion; (3) the changing marketing relations with consumers; and (4) the increases in the retailers' size and purchasing power over the past several years. Accordingly, manufacturers and retailers, through their respective representatives, frequently negotiate or collaborate on the nature and terms of specific promotions. It should be appreciated that not every such trade promotion is negotiated or collaborated. If the nature and terms of the promotion are acceptable, the retailer simply accepts the promotion "as offered" by the manufacturer. Such trade promotions, in contrast to the other types of trade promotions and the consumer promotions described above, create flexible promotions which are more tailored to the retailer's marketing and local needs. [0008] One of the more prevalent type of trade promotions is known in the industry as or referred to as "scan-based trade promotions" or "scan-pay trade promotions." They are referred to as "scan-based" or "scan-pay" because the performance of the promotion can be tracked by reviewing the participating stores' conventional point-of-sale ("POS") system data or information. Scan-based trade promotions enable the collection of useful data on the promotion by recording the actual number of promoted products sold during the promotion period, rather than by recording data on the number of cases of the promoted product purchased by the retailer. In these scan-based trade promotions, the retailer usually passes a discount received from the manufacturer along to the consumer in one of two forms: (1) a reduced product price promotion; or (2) an electronic discount promotion. [0009] When the discount is passed to the consumer in the form of a reduced product price, the price of the promoted product is reduced for every promoted product purchased by every purchaser. The intended discount to the consumer is part of the price that is recorded in the POS system in a single scan entry. [0010] When the retailer offers the promotion in the form of an electronic discount, the consumer receives the discount by presenting a discount triggering device such as a retailer shopping card (usually designated as a frequent shopper card which is part of the retailer's frequent shopper program) depending on the retailer's marketing plan. In this electronic discount promotion, the consumer is first charged the full retail price of the promoted product before a discount entry is applied to lower the consumer's actual purchase price. It should be appreciated that this method enables the retailer to provide the intended promotion benefit to some or all of the consumers purchasing the promoted product. Different consumers may also be given different discounts based upon their status or amount of purchasing. [0011] Sometimes the nature and terms of the promotion do not require the retailer to pass discounts along to the consumer. For instance, if the manufacturer and retailer agree that the retailer will display or place the promoted product at the end of an aisle or place an advertisement for the promoted product in a local newspaper in the retailer's advertisement, the manufacturer pays an agreed upon "merchandising" fee to the retailer for this promotion. The manufacturer can determine if the retailer complies with this promotion by checking the appropriate local newspapers or visiting the retailer's stores as appropriate, but cannot easily track the results of the promotion. [0012] The systems for administering the homogenous manufacturer-driven consumer promotions are less applicable to the increasing number of such trade promotions and particularly scan-based trade promotions. Unlike manufacturer-driven consumer promotions which are tracked by the single set of terms set by the manufacturer, the process for administering a number of concurrent customized scan-based trade promotions is currently fragmented, cumbersome and involves numerous manual steps. Moreover, the current systems do not sufficiently handle the various different types of trade promotions. [0013] The current process for administering scan-based trade promotions is as follows. A manufacturer representative offers a promotion to a retailer buyer or merchandiser approximately two to three weeks prior to the start of the promotion by providing the retailer buyer the nature and terms of the promotion in the form of an electronic or paper deal sheet (as required by the retailer). Generally, the retailer buyer covers a specified geographic location for the retailer. The retailer buyer evaluates the proposed promotion and analyzes it in terms of the retailer's needs (business objectives of the promotion, timing of the promotion, financial impact of the promotion, marketing impact of the promotion, etc.). After evaluating the proposed promotion, the retailer's buyer either accepts the promotion as is, negotiates different terms for the promotion or rejects the promotion outright. [0014] Once the retailer buyer and the manufacturer representative reach an agreement on the promotion, the manufacturer and the retailer each have an independent method for tracking the promotion. These tracking methods may be manual or automated. The manufacturer and retailer tracking methods operate independently of one another, and there is generally no communication or verification of the promotion between these two separate methods. The manufacturer and the retailer have no way of verifying that the other party correctly understands the terms of the promotion or that they are correctly implementing or tracking the promotion. Prior to the promotion being executed, if the retailer desires to change the terms of the promotion for whatever reason (e.g., a retailer wants to postpone a planned promotion of ice cream because a decrease in temperature is forecasted for the originally agreed period of the promotion), the retailer often does not contact the manufacturer to re-negotiate the promotion or notify the manufacturer of the retailer's change. Such changes make it virtually impossible using current systems to correctly track the promotion particularly given the different tracking methods of the retailer and the manufacturer. [0015] Prior to the start of the product promotion, the retailer orders sufficient stock of the promoted product (if necessary) and places the appropriate advertisements or signage for the promotion (if necessary). The retailer also communicates the necessary promotion information, including the special prices or handling (discount) of UPC codes of the products involved in the promotion, to its POS systems in each retailer store. The promotion hopefully begins on the agreed upon start date and hopefully runs to the agreed upon end date. As customers purchase the promoted product, the retailer's in-store POS system (including the check-out scanning equipment) reads the UPC code of the scanned product. If the retailer is running a scan-based reduced price promotion, the discount is reflected in the product's reduced price. The POS system stores this promoted product POS data or information in the store's central POS computer with the other product POS data. If the retailer is running an electronic discount promotion, the customer may be required to present a discount triggering device, such as a frequent shopper card, to the sales clerk to receive the discount. The sales clerk scans the frequent shopper card and the POS system recognizes a linked code from the UPC file which credits (i.e., reduces the price to) the customer by the amount of the discount. The linked code is a locally assigned code number programmed by the retailer. This code is commonly called a "coupon price look up (PLU)" code in the industry although no physical coupon is involved in this type of transaction. The POS system also stores this POS data or information in the store's central POS computer. All of the product POS data or information, including the discounts provided, are referred to in the industry as POS movement data. At regular intervals (usually daily or weekly), the systems at the retailer's headquarters automatically retrieve the stored product POS data or POS movement data from the retailer's stores. Once retrieved, the retailer's headquarters systems process the data and store it in a central POS movement database, often referred to as a "data warehouse." [0016] Either manually, or sometimes with systems support, the retailer uses the data warehouse to determine the amount of money the manufacturer owes the retailer under the terms of the scan-based promotion. The retailer's accounting department then either: (1) generates an invoice for the calculated amount and sends it to the manufacturer for payment; or (2) deducts the calculated amount from any amounts the retailer owes the manufacturer. In some, but not many instances, the retailer produces some type of reduced payment, charge back, or deduction notice or notation for the manufacturer. The retailer forwards the retailer's invoice or the reduced payment notice (and the reduced payment) to the manufacturer. Upon receipt, the manufacturer's financial personnel process the retailer's invoice or reduced payment notice (and reduced payment). Usually, the manufacturer's financial personnel merely accept the invoice or reduced payment notice (and reduced payment) without the ability to verify that the retailer's calculated amount is correct, the number of promoted products sold by the retailer during the promotion period, the amount of the discount given to the consumers or that the promotion was conducted according to the other terms of the promotion. In many instances, the retailer simply makes the deduction without notifying the manufacturer. [0017] There are several problems with this system of administering scan-based trade promotions. The main problem for the retailer is that the retailer may wait a significant period of time (up to 45 days) for reimbursement for the discounts given to customers on the promoted product. The retailer must also spend a significant number of man-hours processing the POS movement data, preparing an invoice for the manufacturer, handling a deduction, and in some instances creating a reduced payment notification for the manufacturer. The retailer also must deal with the possibility that it may potentially fail to track a promotion altogether or that the retailer may fail to track all of the products involved in the promotion. [0018] The main problem for the manufacturer is that the manufacturer has no effective method of verifying the retailer's invoice or the accuracy of the reduced payment notice in a timely manner. Manufacturers generally prefer to avoid retailer deductions from invoice or product payments especially when the retailer does not provide notice of such deductions. Manufacturers preferably desire a system which determines the manufacturer's actual cost liability during the period of the promotion before the retailer sends a reduced payment. Further, under the present manual systems, the manufacturer has no effective method of verifying that the promotion is being executed in accordance with the terms of the promotion. Specifically, the manufacturer has no effective method of verifying the number of promoted products sold according to the terms of the deal sheet including the agreed upon time frame and for the agreed upon promotion price or discount. [0019] Further, as with any manual system, there is a significant potential for error due to the manual transcription or miscalculation of information for both the retailers and the manufacturers. The manufacturer and the retailer have no way of monitoring results of the scan-based promotion during the promotion. Accordingly, there is a need for a system and method for administering promotions and specifically for overcoming these problems in the recording, tracking, reporting, monitoring, verifying and settling of or facilitating payment for scan-based trade promotions. SUMMARY [0020] The present invention overcomes the above problems by providing a system and method for administering promotions and specifically for efficiently and effectively recording, capturing, tracking, reporting, monitoring, verifying and settling product promotions including scan-based trade promotions entered into the system. The system of the present invention includes an automated independent recording, capturing, tracking, reporting, monitoring, verifying and clearing or settling system ("independent system") which: (1) captures and stores the nature and terms of the promotions involving or agreed upon by a retailer and a manufacturer; (2) provides the manufacturer and retailer access to the stored nature and terms of the promotion as well as other relevant information; (3) establishes communication with the appropriate systems (such as the retailer's POS system) to obtain POS information or data on the promoted product (for scan-based trade promotions); (4) processes and verifies the promoted product POS data for both the retailer and the manufacturer to determine the amount of money the manufacturer owes to the retailer for the scan-based trade promotion; (5) provides the manufacturer and retailer access to the processed promoted product POS data and payment information including an identification of the promoted products, the number of promoted products sold (to a certain date) during the promotion, the amount of money the manufacturer owes the retailer and the amount of money paid to the retailer (to a certain date); (6) provides the manufacturer and retailer with a system for communication of internal or confidential information regarding the promotion and future promotions; and (7) settles (i.e., pays) or otherwise facilitates payment of the retailer for the promotion. For purposes of this application, "payment information" includes all information relating to the amount of money owed by the manufacturer to the retailer for the promotion and the related payment information. The system uses suitable graphical interfaces for providing the retailer and manufacturer access to the system. Continue reading... Full patent description for System and method for administering promotions Brief Patent Description - Full Patent Description - Patent Application Claims Click on the above for other options relating to this System and method for administering promotions patent application. ###  How KEYWORD MONITOR works... a FREE service from FreshPatents1. Sign up (takes 30 seconds). 2. Fill in the keywords to be monitored. 3. Each week you receive an email with patent applications related to your keywords. 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