JDA Launches New Luminate Pricing and Replenishment Solutions Embedded with Advanced AI/ML Capabilities


JDA Software, Inc., today announced it has launched the first joint solutions following its recent acquisition of Blue Yonder, focused on optimizing Replenishment and Pricing strategies. These new solutions leverage the leading artificial intelligence (AI) and machine learning (ML) capabilities of Blue Yonder, which JDA recently acquired in August 2018. JDA® Luminate ReplenishmentTM, and JDA Luminate PricingTM fully embrace the power of AI and ML to deliver optimized replenishment and more dynamic pricing capabilities that help customers drive increased profits and revenues in their retail operations.

“This announcement marks the industry’s first productized AI solutions for retail and supply chain at scale, and represents another major step in our journey towards delivering a truly Autonomous Supply ChainTM,”said Desikan Madhavanur, chief development officer, JDA. “The agility of Blue Yonder’s Microsoft Azure-based applications enabled us to accelerate the successful launch of three new important solutions to market less than 45 days after closing the acquisition, a truly remarkable feat by our collective development teams.”

Luminate Replenishment Reduces Fresh Product Waste and Cuts Out-of-Stocks with the Power of AI and ML
Luminate Replenishment creates accurate, granular intra-day demand forecasts, enabling optimization of product availability while reducing waste and unnecessary manual interventions. Blue Yonder’s AI technology solves the challenges of fresh item and fast-moving goods replenishment using predictive analytics – delivering automated store replenishment for retailers and reducing out-of-stock rates by as much as 80 percent while simultaneously reducing waste or inventory levels. By applying Blue Yonder’s ML technology to prediction models, Luminate Replenishment learns the underlying dynamics of item demand through sales data and numerous other internal and external data sources that influence customer demand. JDA’s first Luminate replenishment solution focuses on optimizing store replenishment. Future releases will include distribution center replenishment capabilities and other replenishment optimization capabilities across the end-to-end supply chain.

“Achieving accurate fresh service level availability while reducing associated waste is a constant struggle for grocers and retailers. For the first time, Luminate Replenishment solves the fresh item replenishment conundrum by creating probabilistic forecasts to optimize decisions based on risk aspects, including the risk of waste due to very low demand, and the risk of out-of-stock situations and lost revenue resulting from very high demand,” added Madhavanur.

Luminate Pricing solution includes markdown optimization capabilities maximizing margins and efficiency 
New markdown optimization capabilities use AI to learn the interactions between price and demand changes for each store. Customers can automatically set revenue- and profit-maximizing prices for different stages in a product’s life cycle, including markdown sales. These new capabilities consider both the costs and impacts of every price change, with the ability to analyze consumer behaviors alongside product master data, as well as external data feeds into the solution, such as weather data.

“Unlike other science-based solutions in the market, our Luminate Pricing solutions learn the price elasticity of demand and forecast probabilistic views of demand, which includes the use of over 200 external factors to systematically evaluate all price points for a given product and store combination to determine the resulting changes in customer buying behavior. After a short learning period, the solution recommends the optimal markdown price for each product in each location, ensuring that the price matches our customers’ overall pricing strategy,” said Madhavanur.

JDA price optimization capabilities enable optimal pricing strategies using AI
Luminate Pricing also includes new price optimization capabilities ideal for retailers who want to create better pricing strategies and achieve strategic goals such as revenue growth or increased profits. This SaaS application, also built on Blue Yonder’s AI technology, tests and measures interactions between price and demand changes for each store. With price optimization capabilities, retails can automatically sets revenue- and profit-maximizing prices using current and historical sales data, alongside product master data and over 200 demand-influencing factors. This solution goes beyond scenario-based optimization technologies and allows customers to quickly optimize hundreds of prices every day based on real-time conditions, while simultaneously considering the cost and effects of each price change by location and channel.

“Price optimization capabilities allows our customers to set the pricing approach that matches their strategies, including revenue or profit maximization or stock-based pricing. With a 360-degree view of the entire market, this solution delivers a price strategy that is competitive, and aligned with customer expectations – avoiding the price wars and races to the bottom that can often be caused by repricing tools,” concluded Madhavanur.