Products and Promotions
Today, we’re going to take a look at the role your products and promotions play in making your business a success.
Many eCommerce businesses close down every year due to cash-flow problems because too much of their money has been tied up in stock that wasn’t selling fast enough or driving enough of a margin.
If you want your business to succeed, make sure you get your products and promotions right and that they work hand in hand to keep your warehouse emptying and the sales coming in.
Like marketing, your products need constant optimization. You need to monitor the sales and tweak the product mix, pricing, and promotion to keep the money rolling in and the warehouse emptying (and ultimately, the cash flowing).
• Keep your bestsellers in stock
• Expand the product categories and ranges the customers are buying
• Clear bad sellers out quickly to generate cash to spend on more bestsellers
I group promotions with products because to succeed, you need to turn the stock back into cash as quickly as possible while selling it for as high a price as possible. And that’s the job of your promotions.
The key to successful promotions is to get the customers to do what you want them to do as cheaply as possible
Whether you want them to buy a certain product, clear out your overstock, or give you feedback on your latest range, it’s a promotion that’s going to make it happen.
Promotions are not necessarily price discounts; a promotion is any message that can be used to get customers to your site and to buy. This might include:
• free P&P
• free returns
• voucher codes
• 20% off deals
• free gifts
• half price when you do X
• gift to charity
• prize draw
• the last few available
• brand new
What you want the customer to do, and how much you’re willing to pay to achieve that, will change what promotion you put in place.
If you need to clear out the rest of the season’s stock to generate cash to buy the new season’s stock, then a sale with really simple discounting is a great idea. But if you want to increase the AOV, you need to do a multibuy offer or a “Spend over £X, Save £10.”
Make sure you keep it simple. A promotion should be easy for the customer to grasp or they won’t take you up on it.
Catch up tomorrow, when we take promotions to the next level and focus in on your marketing plans.
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