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Flash Sales and Product Drops: Move Inventory at the Speed of Light

flash-sales-and-product-drops:-move-inventory-at-the-speed-of-light

Retailers are putting online strategies to the test as they anticipate a rise in ecommerce sales this Black Friday, Cyber Monday and holiday season. As a result of fluctuating Covid-19 infection rates, shoppers have increased their savings that they would have otherwise spent on travel, vacations, and dining. And with fewer parties to attend, consumers who saved are expected to splurge by giving gifts to friends, increasing holiday cheer with self care, and putting money towards home improvements. 

According to Deloitte, sales are predicted to grow between 25% to 35% from November through to January, reaching $182 billion to $196 billion in total. To prepare for a busy ecommerce season this fall, Amazon pushed their annual Prime Day shopping event to October this year, rather than July. This strategic move gave the ecommerce giant more time to plan for their biggest sales day of the year, which last year brought in $7 billion in overall revenue.

To take advantage of this BFCM and holiday shopping season, brands need to reimagine how they will optimize their ecommerce plans to maximize sales. This may include adopting an omnichannel holiday marketing strategy, boosting holiday sales with customer service, or strengthening customer loyalty with BOPIS.

Whether you are launching a new product, or throwing your biggest sale ever, it’s important to keep your shoppers up-to-date. To do so, you’ll need to start creating buzz around your products and services. Here, we’re going to take a look at the art of flash sales and anticipated product drops to move your products fast. We’ll also take a look at examples of successful campaigns, as well as offer marketing tips on how to build hype to drive your 2020 sales.

What is a flash sale?

A flash sale comes and goes, just like a lightning bolt in a rainstorm. It’s a short-term sale that provides a great opportunity to convert customers by promoting a small inventory of hot products in just a few hours. Exclusive time-limited deals boast urgency and play along your shoppers’ fear of missing out (FOMO) to drive impulse purchases and boost immediate sales.

What is a product drop?

A product drop is similar to a flash sale, except these launches span an even shorter time period. This time, a limited quantity of products is offered to shoppers. The benefit to the customer is getting something exclusive, or getting it first. For brands, it’s a way to test out new products to the market. If a drop is successful, brands may choose to bring the product back for a second drop or a wider release.

Are flash sales and product drops an effective sales strategy?

Online shoppers have more tools than ever to research and compare products online. When it comes to finding a great deal, flash sales and product drops help customers find what they are looking for, but for only a limited time period. For brands, these sales promote a sense of urgency that helps stock sell faster.

Additionally, flash sales and product drops increase brand awareness. Offering steep discounts or exclusive items for a limited time can strengthen customer loyalty, boost conversions and increase your customer lifetime value (CLV). By moving excess items, you can also add room for more inventory. These limited-time sales help companies acquire more customers faster, and boost their overall revenue.

Operational Challenges

There are multiple considerations that should be taken into account when running a promotional deal on your ecommerce website, including:

#1 Managing Inventory

To run a successful promotion, you’ll need to make sure your warehouse and ERP (enterprise resource system) is ready to fulfill a high volume of orders. This means ensuring that you have the correct infrastructure to scale your order volume. This may also mean hiring temporary staff at the warehouse level to meet your end-to-end fulfilment needs.

Customer perception is shaped not only before the sale, but by what happens after a purchase is made. From 1,888 interviewed U.S. consumers, around 40% said the reason they didn’t make a purchase was because it wouldn’t arrive on time. And around 20% said they didn’t order a product because the delivery date was not clear.

If you can’t compete with the speed of Amazon, create a stronger customer experience and avoid frustration by letting shoppers know when their purchases will arrive. For example, you can provide a notice on your website, and in your order confirmation emails, that lets customers know that purchases will be shipped in 3-5 days due to high demand.

#2 Site Performance

Even for large brands, flash sales and product drops can result in website crashes. When visitors can’t visit your website, your sale will come to a complete stop. That’s why it’s important to make sure your technology supports scaling to prevent crashes during high order sales periods. 

Also, your third party tools and apps that depend on API calls should be load tested prior to your promotion. This way you can ensure your technology infrastructure has the right capacity to handle a surge in traffic. By managing these expectations, you can determine what additional adjustments need to be made to your site before your sale starts.

#3 Bots

If you’re selling limited edition products, your website may be a target for bots. Bots are a computer program that hack into ecommerce checkouts to buy up exclusive products, and then resell them at a markup cost to thriving resale sites online. 

This is bad for both loyal customers and brands. Fans lose out on the opportunity to purchase merchandise they love. And retailers face the threat of losing sales, damaging their reputation, and degrading their competitive reputation. 

To fool commerce systems, bots change their server or IP address, or use a VPN to mask their identity. This means that using third party apps to stop bots won’t necessarily lockout all of their destructive activity.

 Luckily brands on Shopify have options for outsmarting bots. On Shopify Plus, you can schedule bot protection directly from your admin to protect sales events. In addition to standard bot protection, you can activate a reCAPTCHA challenge to ensure only human buyers will be able to proceed from their cart to the checkout page. This ensures your customers can make the purchases they want, and that your brand can increase your average order value (AOV).

If you need further help, feel free to contact our System Integrations team about custom solutions for detecting bot traffic and combatting bot attacks.

Powering flash sales and product drops with Shopify

Shopify is an excellent ecommerce platform for driving flash sales product drops. It supports a high number of checkouts per minute, has built-in bot protection, and automated event scheduling. According to Shopify, 10, 978 peak checkouts occur per minute across the leading ecommerce platform. 

Plus merchants have exclusive access to Shopify’s Launchpad – an automation tool for major online events on Shopify Plus. Automation eliminates the complexity of running events, and turns them into streamlined opportunities that allow brands to:

  • Release products and update inventory across channels
  • Apply discounts to particular products or entire collections
  • Design campaign themes and continuously update them 
  • Revert any changes made when the event ends

By automating repetitive tasks, Shopify enables brands to hit record breaking sales without compromising site performance.

Brands Creating Excitement and Hype on Shopify

1. Fashion Nova launches continuous flash sales

With over 15 million Instagram followers, Fashion Nova is a top performing fashion brand with more exposure than Zara and H&M combined. But what makes the brand so successful? Their rate of production and selling fast is what sets the brand apart. The label works with over 1,000 manufacturers, who whip up samples from concept to photograph-ready within 24 hours.

To stay on top of the game, Fashion Nova has kicked off some of the largest flash sales in history. In 2018, the brand collaborated with influencers like rapper Cardi B to bring in $10.8 million in just 3 hours for their holiday sale that offered discounted items from 40 to 90% off. The event was accompanied by an IRL (in real life) fashion show that was broadcasted on their social media.

A week later after their collaboration with Cardi B, Fashion Nova took a similar approach, with a social media campaign that promoted their Black Friday and Cyber Monday deals with discounts up to 90%. By being over-the-top in every sense, Fashion Nova continues to scale on Shopify Plus with ongoing flash sales to attract new customers.

cardi b

Campaign image credit: Fashion Nova

2. Gymshark breaks records with their Blackout Campaign

Gymshark, one of the world’s most successful fitness apparel and accessory brands, runs two flash promotions per year. This includes a summer event and a Black Friday Cyber Monday (BFCM) event called ‘Blackout’. During Blackout, the company’s bright social media presence turns dark and black. Models wear black clothing, and pictures are posted with blank images with no caption to captivate their audience’s attention. 

Last year during BFCM, Gymshark offered up to 70% of their products, with free shipping to all stores, and extended returns. Due to exceptional volumes of sales, the 2019 Blackout campaign broke all of the previous year’s records, including:

  • 650,000 orders in the first 5 hours
  • $400,000 of sales in the first hour
  • 1m unique customers
  • 1.1m total orders during the 9-day campaign
  • 13m total sessions for the campaign

For a full overview of how Gymshark prepared for their biggest sale planning, including preparing social media and ad campaigns, logistics and operations, you can watch this insider video by Ben Francis, Gymshark’s owner and CEO:

3. KITH builds success with collaborations and product drops

Established in 2011, KITH is one of the most well-known high-end streetwear and lifestyle brands today. Over the years, KITH has seen tremendous growth on Shopify Plus. Particularly, many shoppers look forward to its exclusive product drops. These fresh product releases inspire customers to line up outside of their doors for a chance of getting their hands on a rare piece of clothing or sneaker.

KITH’s “Monday Program” is a huge part of their business. The brand uses these limited edition drops to engage with customers, who can purchase items directly on a mobile app. To create exclusive merchandise, the company partners with some of the most popular labels today. This includes collaborations with popular labels such as Off-White, Moncler, Nike, Adidas, Coca-Cola, and Bergdorf Goodman.

6 Best Practices for Marketing Flash Sales and Product Drops

1. Tell stories based on your consumer data

When running flash sales or product drops, it’s absolutely essential to leverage data insights you’ve gathered from your customers’ shopping behaviors. Be mindful of what kind of content they interact with, which emails they clicked through, and what social media posts resonated with them. This will help you tailor marketing stories that drive leads to your sales promotions. 

For example, let’s say you’re a fashion apparel company with an audience of shoppers who have previously purchased athleisure wear like yoga pants, joggers and hoodies for working out from home. Then a “Stay at Home Survival Sale” would be the perfect way to appeal to your audience’s interests.

2. Embrace social media sharing, influencers, and collabs

Flash sales can create a lot of buzz on social media, as customers share your deals with their friends. Because of this, flash sales and product drops aren’t as effective if you have them on an ongoing basis. When it comes to creating hype and excitement, try keeping your promotions unpredictable and don’t hold them too often.

Promote your short-term sales on your social media channels, like Instagram, Pinterest, Facebook, and TikTok. If it’s difficult for your brand to work with celebrity influencers, try partnering with local social media influencers to increase the ‘cool’ factor of your products. Another popular strategy is collaboration. In this case, brands partner with other brands, celebrities, or designers to create limited lines of products that are highly cherished by fans of both creators. This strategy is most popular in the fashion and beauty sectors.

3. Timing is everything, and so is creating expectations

Your website content, email messaging and social media posts should create a consistent expectation of when your special deals will arrive. This consistency will ensure that your shoppers are on top of your deals when they go live. As for scheduling your flash sale, it’s best to look at your analytics and see if any patterns emerge, such as days of the week people have purchased in the past, and when your email open rates are highest. 

According to data from Shopify Launchpad, close to 30% of sales event start times start at midnight, and last anywhere from less than 24 hours to a total of 1 week in duration. Though research suggests that shorter is often better, with 3-hour sales resulting in email open rates 59% higher than average.

4. Maximize loyalty programs and newsletter sign-ups

Your flash sale and product drop customers might not stick around after your short-term promotion ends. This is why it’s important to try to convert these interested shoppers into long-term customers through a loyalty program, or a newsletter, while you can. 

You can do this with a sign-up form on your website, an email, or a pop-up on your website. To encourage sign-ups, you can promise to keep your shoppers in the loop about future product flash sales and product drops. You can also offer bonuses, like a 10% discount or free gift, to encourage customers to sign-up. By keeping more customers in the loop about upcoming events, you can increase repeat purchases and boost your customer lifetime value (CLV).

5. Reach Gen Z by emphasizing value and credibility

Gen Z, the cohort born between 1996 and 2010, tend to treat non-conformism as a virtue. This means that they will gravitate towards items that are exclusive or have a small release. To attract this generation to your flash sale or product drop, you can signal product value. Provide messaging that lets your shoppers know that your products are exclusive, and signals a status that others can’t get or work to get. 

You can also use fear of missing out (FOMO) language to build hype on social media around your short-term sale. By providing your shoppers with exclusive products they can’t buy elsewhere, you can create excitement, and fulfill their need for instant gratification.

6. Promote scarcity and urgency to boost sales

Limited time offers create a sense of urgency on your store. When customers see that a sale is expiring soon, they experience FOMO, and are more likely to make a purchase. For example, you can show that your store is running low on quantities by using language like ‘today only’, ‘selling fast’,  ‘only # left’, or ‘limited quantities available’. 

Another tactic is to use a countdown timer. Customers see how much time is left before a sale ends, which encourages them to make a purchase faster. Limited time VIP promotions is a way you can drive a sense of scarcity, and encourage customers to sign up to create a loyalty member account. 

Get ready for the BFCM and Holiday Season with Flash Sales and Product Drops

With Black Friday and Cyber Monday (BFCM) approaching, it’s the perfect time to take advantage of seasonal flash sales and product drops of high-value items and holiday gifts. With Shopify, you’ll be well equipped to scale your sales with bot protection, and grow your local customer base by putting more humans at the front of your checkout queue. 

If you’re a growing retail business, it can be difficult to find the time and team power to prepare your website for a flash sale or product drop. If that’s the case, you can use the help of an agency (like Diff) to prepare your site with automation and personalization to increase your ROI. Automation allows you to focus on growing your business instead of repetitive tasks, and personalization targets your customer segments for a greater customer experience.

Want to learn more tips on how to maximize ROI for the upcoming Black Friday, Cyber Monday, and holiday season? Sign up to our newsletter to learn the latest commerce and Shopify tips.

This article originally appeared by our friends at Diff Agency.