Forecasting Sales Profiles of Products in an Exceptional Context: COVID-19 Pandemic

Abstract

AbstractAccurate demand forecasting has always been essential for retailers in order to be able to survive in the highly competitive, volatile modern market. However, anticipating product demand is an extremely difficult task in the context of short product life cycles in which consumer demand is influenced by many heterogeneous variables. During the COVID-19 pandemic in particular, with all its related new constraints, the fashion industry has seen a huge decline in sales, which makes it difficult for existing sales forecasting methods to accurately predict new product sales. This paper proposes an original sales forecasting framework capable of considering the effect of the COVID-19 related crisis on sales. The proposed framework combines clustering, classification, and regression. The main goals of this framework are (1) to predict a sales pattern for each item based on its attributes and (2) to correct it by modelling the impact of the crisis on sales. We evaluate our proposed framework using a real-world dataset of a French fashion retailer with Omnichannel sales. Despite the fact that during the lockdown period online sales were still possible, consumer purchases were significantly impacted by this crisis. Experimental analysis show that our methodology learns the impact of the crisis on consumer behavior from online sales, and then, adapts the sales forecasts already obtained.