What a journey! After we scaled the List Growth Mountain, competed with the Amazon, Inc. forest, survived Technology Glitches in the Bermuda Triangle, and traversed the Discount Desert we finally have a moment to rest. Now would be a good time to check our supply inventory! During any digital marketing journey you tend to build up an inventory due to the many ebbs and flows of ecommerce. So what happens when you have extra inventory? We have found a few strategies that help our clients generate sales on different platforms in many different situations. Read on to see how we are able to avoid the potential traps of inventory management!

1. Managing Your Inventory Turns
As consumers, we experience this most frequently with retailers that have seasonal releases of new products, where product is sold at full retail price, and has a series of discounts at increasing percentages to manage inventory turns to defined windows. Apparel retailers are good examples of this. Nothing is worse than looking at sweaters in March while you’re waiting for Spring to arrive, but that is when you get some of the best deals from retailers who manage this turn effectively.

2. Flash Sales
Flash Sales are very common among retailers. However, they are generally only done a limited number of times per year. The sales are for a very short duration (think hours, not days) and generally include a broader group of products at a very significant discount. It is an extremely successful way to move through a large volume of product in a short amount of time. We typically employ this tactic when total inventory levels reach levels that are higher than desired. For Example, our client Mitchell & Ness did this with jerseys many years ago. When they were carrying an excess of jersey inventory, they ran a single day $100 jersey sale for products that were usually $250-$300.

3. Partnering with Loyalty and Discount Sites
The third way to push inventory is by partnering with loyalty or discount sites. This strategy is a good way to try to incentivize a new, captive audience and introduce them to a brand’s products. When you factor in the marketing and incentive dollars, this solution has the lowest margin. However, if you can encourage repeat purchases from a new audience, then this tends to be a cheap way to also acquire new customers. Be careful, though! It is very important to structure the campaign so this does not just lower the margin on customers who were already going to buy, or result in customers that have no intention of buying from your brand again in the future.

4. Clearance Section
Creating a clearance section on your site may seem obvious, but it is important that there is a clear and obvious place on your site to find discounted products. You would be surprised by how many companies forget this point. We recommend this strategy to all of our clients and especially if they are looking to push inventory. One example is in cosmetics. They have a comprehensive and easily discoverable sale section which helps them successfully push older or slower moving products.

5. Create Your Own Outlet Site
May retailers are hesitant to have deep discounts on their main site for fear that it will cheapen their brand. One useful tool to avoid this situation is to create their own outlet site. By doing this they can separate go beyond just having a clearance section and make it a whole new site with different branding. This is especially useful for manufacturers who must be mindful of how aggressively they are discounting on their core site because they do not want to negatively impact their relationship with other retailers. You can see examples of this in the J. Crew Outlet or Nordstrom Rack. But perhaps the best example is Joe’s New Balance Outlet which goes the extra mile of separating the brands and creating a whole new experience that doesn’t feel like it’s New Balance.

6. Use Inventory as a Gift with Purchase
Everyone loves to get a gift, right? Adding extra inventory as a gift with purchase can seriously increase purchase incentive. The product that is being purchased is generally at full price, and the free gift is the means to increase conversion rate, rather than a discount. Another benefit this provides is that it can introduce a customer to a different type of product that might be in a category they would consider for a future purchase. Mitchell & Ness has done this to introduce customers to certain new headwear silhouettes and their M&N branded apparel.

7. Segmenting Clearance items from Evergreen Products
We frequently work with clients who sell a variety of different products. Products tend to not only differ in style, color, or material, but they also differ in seasonality. We find that segmenting between products that are generally in stock and those that are seasonal. It is important to not only separate these products, but to also communicate the differences simply and clearly to customers. This will ensure that both segments are being marketed and sold in the most optimized way. We perform this strategy with our client Mitchell & Ness. They have jerseys that are generally in stock and unlikely to change from season to season, and then other products that are seasonal and the inventory is meant to turn over significantly more quickly.