No matter how strong your consumer engagement is or how many high quality pictures are used on your product pages, if the product is out of stock then you could be losing sales. It is vital to be in stock in order to capture and convert first-time shoppers. If your item is not available for shipping, then a new shopper can easily find a competitive product to try. Once that shopper finds another brand that is in stock, it is going to be exceptionally hard to win them over. For brands that have optimized their in-store inventory for years or decades, it can often be difficult but imperative to accurately gauge online channel demand.
Retailer Subscriptions Affect eCommerce Product Availability
With the rise of retailer subscriptions such as Amazon’s Subscribe and Save , the importance of ecommerce product availability has grown, especially for your most loyal shoppers, since they are more likely to subscribe. The vitamins, minerals, and supplements (VMS) category may be the best example of a market where subscriptions play a prominent role. Multivitamins are an ideal product for this purchase method since consumers typically take a set number of supplements per day and can easily estimate when they will need a refill.
From a supply chain perspective, the benefit to brands is that having shoppers pledge to buy your product at a set date makes it easy for brands to keep track of inventory and demand. It can also save brands on shipping costs. If brands can anticipate weeks (or even months) ahead of when a shopper will receive a delivery, they can utilize slower ground shipping instead of one or two day shipping which is much pricier.
The VMS market is exceedingly competitive with high ratings and reviews averages for market-leading products and fierce brand loyalty. Brands can utilize retailer subscriptions to keep shoppers from switching brands. Because subscriptions automate purchase and delivery of your products, shoppers are less likely to actively make the switch to a competitor.
However, this means that a lack of ecommerce product availability will not only cost you a sale in a market like VMS, but it may very well cost you all future sales from that shopper. Customers are going to rely on your items being in stock, and it may hurt brand loyalty if your item never arrives or is delayed.
Retailer Subscriptions Have Become a Popular Merchandising Method
Recently retailer subscription offerings have expanded and are now a popular merchandising method used by many major retailers including Amazon, Tesco, and Vitacost. Internally, Amazon prefers to see brands that enable this feature move a large percentage of their unit volume through subscriptions. Amazon drives subscriptions by offering shoppers a discount for signing up for repeat purchases.
Not every category is ideal for the subscription model, but where it is applicable, this type of purchase has become vital. As if there was not already enough pressure to keep items in stock, retailer subscriptions adds further pressure in select markets.
