Retailers pulled out all the stops in the 2005 holiday season, offering huge promotions to lure consumers back to their registers. But the jury is still out on what impact increased promotions had on bottom lines. In 2006, with the introduction of SAS Promotion Optimization, SAS retail customers won’t have to struggle to determine the expected lift in demand from promotions. SAS Promotion Optimization is the latest module in the groundbreaking SAS Revenue Optimization suite, which helps retailers manage revenue and margin through the entire merchandise life cycle. Unveiled at last year’s National Retail Federation conference, this suite of integrated software solutions includes: SAS Markdown Optimization SAS Regular Price Optimization SAS Promotion Optimization SAS Markdown Optimization was rolled out first and is being used successfully at several major retail chains. Effective promotional planning SAS Promotion Optimization is a comprehensive planning solution that allows retailers to maximize margin and revenue by accurately determining which items to promote, in which locations, at what price points and via which promotional vehicles. Leveraging SAS’ advanced demand modeling and mathematical optimization techniques lets any retailer - from food, drug and hard goods to mass, apparel and specialty - accurately determine incremental lift from planned promotions. They can then develop and implement optimal promotions, support inventory planning decisions and maximize return on marketing investment. "The relevance of a solution that helps retailers meet revenue and margin goals through effective promotional planning was highlighted by the promotion-heavy holiday season we just witnessed," says Lori Schafer, vice president, SAS global retail practice. "A promotion optimized for timing, pricing and placement can have significant impact on product demand and, consequently, revenue and profitability." SAS Promotion Optimization helps retailers: Analyze the effectiveness of promotional events. Understand the impact on revenue and margin of promoting products through different vehicles. Understand demand patterns. Determine base volume and expected lift in demand and revenue. Decide how much to discount items based on vendor-offered promotional costs and sales targets. Reconcile expected promotional revenue and margin with category financial plans. Powerful "what-if" scenarios SAS Promotion Optimization provides retailers with powerful "what-if" capabilities that help determine the best set of products to promote to meet category objectives. It also assesses the impact of promotions through an on-demand promotional forecast that can be fed into replenishment systems to reduce promotional out-of-stocks. What-if capabilities help retailers understand how space on promotional vehicles, such as circulars and displays, relates to performance. They also help retailers evaluate the impact of vendor-offered promotions on revenue, margin and sales. The solution enables marketers and merchandisers to determine what categories provide the largest ROI on circulars and other marketing vehicles to optimize marketing spending. SAS customers include hundreds of leading retailers worldwide, such as: Bakers Footwear Burger King Carrefour The Children’s Place Fakta Federated Department Stores Lowe’s Companies Karstadt Kohl's Li & Fung Retailing Group Luxottica Retail Marks & Spencer Office Depot Sainsbury’s Sport Chalet Staples Tesco Too Inc. Waitrose Limited Wal-Mart Williams-Sonoma 1-800-FLOWERS.COM

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