Hewlett Packard: Delivering Profitable Growth for HPDirect.com Using Operations Research

Rohit Tandon (), Arnab Chakraborty (), Girish Srinivasan (), Manav Shroff (), Ahmar Abdullah (), Bharathan Shamasundar (), Ritwik Sinha (), Suresh Subramanian (), Dave Hill () and Prasanna Dhore ()
Additional contact information
Rohit Tandon: Hewlett Packard Global Analytics, Bangalore-560093, India
Arnab Chakraborty: Hewlett Packard Global Analytics, Bangalore-560093, India
Girish Srinivasan: Hewlett Packard Global Analytics, Bangalore-560093, India
Manav Shroff: Hewlett Packard Global Analytics, Bangalore-560093, India
Ahmar Abdullah: Hewlett Packard Global Analytics, Bangalore-560093, India
Bharathan Shamasundar: Hewlett Packard Global Analytics, Bangalore-560093, India
Ritwik Sinha: Hewlett Packard Global Analytics, Bangalore-560093, India
Suresh Subramanian: Hewlett Packard, HPDirect.com, Cupertino, California 95014
Dave Hill: Hewlett Packard, HPDirect.com, Cupertino, California 95014
Prasanna Dhore: Hewlett Packard Corporate Marketing–Customer Intelligence, Palo Alto, California 94304

Interfaces, 2013, vol. 43, issue 1, 48-61

Abstract: Hewlett Packard (HP) entered the online consumer sales business with its launch of HPDirect.com, a portal that allows consumers to purchase HP products (e.g., desktop and notebook computers, printers, accessories, supplies) online. This paper describes operations research solutions to a variety of problems in the e-commerce value chain. HP’s objective was to use these solutions to grow its share in the online sales market. First, we identify and quantify the impact of key drivers of online traffic to enhance our market planning and budget allocation process. Next, we apply Bayesian modeling and Markov chain methods to predict which customers are most likely to buy which product, and when and through which marketing channel they are likely to make a purchase. Finally, we use a hybrid forecasting approach combining time-series and regression modeling to predict customer orders for optimizing warehouse inventory holding and ensuring timely fulfillment of customer orders. Since 2009, the integration of these solutions into HP’s marketing planning and warehouse operations processes has helped to generate an additional $117 million in revenue for HPDirect.com.

Keywords: HP; online sales; e-commerce; demand modeling; customer targeting; marketing spend optimization; forecasting; time series; Bayesian modeling; linear discriminant analysis; Markov analysis; linear programming; analytics (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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