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Retail Marketing StuntThen, ‘Contact’, the biggest photography festival in the world took place in Toronto. At the festival, my team ran an event called the HyPe Gallery. We held a photo contest for professionals and made huge prints at the free Gallery where we rotated images daily. Given the lackluster year for this photography printer lineup – I ran a major special offer. But, we would ONLY market the special offer at the event. Channel partners were told, but not encouraged nor supported to repeat the offer. To that point, there was little previous success selling these units. Frankly, I don’t think our partners even took the offer seriously, when first proposed.
Going ViralWe ONLY advertised the promotional offering at the HyPe Gallery. No other word of it anywhere. It was a significant offer. On the highest end, the deepest discount reached 35% - 40%. However, it was only available on the expensive lineup. Across the supply chains, there were boatloads of inventory. No need for in-store safety stock, right? ... Famous last words ... When I first proposed it, no one batted an eye. It was another retail marketing stunt, among many. Yet, the offer went viral within the professional photography community. It was a healthy discount, and it was a secret (only advertised at one physical location). The offer spread exclusively through word of mouth. In fact, it was word of mouth on this secret-ish promotion that made it go viral. Rumors were abound about us blowing out the last of the super-printer inventory. Within 4 weeks we burned through 60 weeks of supply. Our costly amount of inventory excess took a nosedive. All North American inventory with a glut on these very slow-moving SKUs was fully depleted. Carrying costs – gone. Rumor had it that the major competitor's CEO had even yelled at our largest speciality retail chain CEO. He was furious about their completely stalled sales. Mission accomplished!
Related: Real-Time Inventory Visibility
In-Store Safety Stock ImportantFortunately, we had set the printers in the showcase gallery aside as in-store safety stock. They weren’t touched by our online orders. Partners and customers could not purchase or allocate against them. They were meant for display at the Gallery. It would have been embarrassing to have no display during this high traffic, high customer demand time.
Build-A-Bear ExampleCNN Money’s headline “Build-A-Bear CEO sorry for botched Pay Your Age Event” reminded me of my story above. In the case of the Build-A-Bear’s event, it achieved its goal of driving attention and in-store traffic. However, on events like this, you need to make sure you have the right technology to support it. A robust order management system should have provided clear online real-time inventory visibility. On extreme swings like the Build-A-Bear event, in-store safety stock is another concern. Build-A-Bear might be unique in requiring in-store assembly. But for most retailers, safety stock can ensure you hottest items aren't all snapped up online. There are a few still in-store for foot traffic purchasing. You can’t predict the virality of an offer. At the best of times, it is hard to predict customer demand. But by showing real-time inventory level at each store, it might adjust customer expectations. And customer service expectations are definitely on every store manager’s mind at these times. A big part of this initiative was driving in-store traffic. Actually, Build-A-Bear is a perfect example of focussing on the in-store experience. However, during peak demand times, like this promotion, in-store safety stock makes sure online orders don’t empty the shelves. By keeping some of the store merchandise allocated for in-store purchases, it encourages customers to come to the physical store. In-store safety stock ensures shoppers who show up, have an opportunity to get in on the deal. It’s won't be just for the fastest online purchasers. This might not have been the only challenge... but...
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