How to Boost Sales and Profit with Pre-order Selling
Pre-orders have taken root now more than before. Gone are the days when you can not sell what you don’t physically have in stock.
Now, online businesses can put up product images of the product and customers pay with the understanding that delivery will occur on future dates; which could be in a few days, a few weeks, or even a few months.
If you’re looking for a way to boost sales and profits, pre-order strategies can be a great option, especially for new releases, upcoming products, and product launches.
What is pre-order?
Pre-order is when a customer makes a purchase for an upcoming product not yet in stock, with the understanding that delivery will be made at a later date.
This can be done for products that are upcoming releases, or for items that are currently out of stock. For many business owners, allowing pre-orders can be a great way to build hype, and increase upfront revenue and profits for your business.
By offering customers the ability to pre-order products, you can increase interest, social proof, and excitement in your product line and ensure that you have enough inventory on hand to meet customer demand.
How can pre-ordering help boost sales and profit?
Pre-ordering can help boost sales and profits in a number of ways and you as a business owner should be aware in order to use a pre-order plan.
Increase interest and excitement in your products.
This can lead to increased sales and generate buzz as customers are more likely to purchase products that they are interested in and excited about.
Can help ensure that you have enough inventory on hand.
By pre-ordering products, you can ensure that you have the necessary inventory on hand to meet customer demand when the product is released.
Stock-out in a period of high demand is a loss of potential profit; you would not want that for your business.
Can help businesses track customer interest in new products.
By gauging customer interest in pre-orders, businesses can better assess which new products are likely to be successful and which ones may not be as popular.
If you have a product that showed high sales prospects during pre-order launch day, that is an indicator that you should stock up more, vis-versa for low-performing pre-order products.
Why should businesses consider pre-order campaigns?
Businesses should consider a pre-order system of selling for a number of reasons which include:
If you are interested in more sales for your products, then you should consider pre-order. Businesses tend to make more sales in the short run without initial financial commitment when they offer products on a pre-order basis.
Used in raising capital
Proceed from the pre-order sales can be a source of funding. You necessarily do not have to in place the capital to stock up the products but can raise the money for it during the pre-order window.
Reduce cost and inconveniences associated with warehousing
Since the products are already pre-sold, you will need short storage time or no storage time for them because they will be delivered straight to the customer once it is released.
This can help reduce costs and inconveniences associated with warehousing.
10 products that can be sold using pre-order campaigns
These are some products you can sell on a pre-order basis but this list is not exclusive. There are many others that you can sell using the pre-order system of selling. These are just selections based on market demand, profit margin, and popularity.
Books can be great when pre-sold. They often have a high-profit margin and customers are always looking for the latest release. They could be physical books or digital ones.
Like books, video games often have a high-profit margin and customers are always interested in pre-ordering the latest release.
Clothes and shoes
These can be pre-ordered to ensure that you have the right size and style for your selected gender/age class.
From smartphones to computers, pre-ordering electronics can help ensure that you have the latest and best models in stock for your customers.
Toys and Collectibles
Whether it’s a popular action figure or a new line of dolls, pre-orders are often a great way to boost sales for toys and collectibles.
Furniture can be pre-ordered to ensure that you have the right style and size for your customers.
From paintings to rugs, pre-ordering home decor can help ensure that you have the latest and greatest products for your customers.
Gourmet foods can be pre-ordered to ensure that you have the freshest and best food for your customers.
Vehicles can be pre-ordered to ensure that you have the right types and models for your customers.
Perfumes and Cosmetics
Perfumes and cosmetics can be pre-ordered to ensure that you have the right size and formulation for your customers.
How can businesses get started with pre-ordering?
If you are a business owner who is interested in getting started with pre-ordering, there are a few things that you will need to do before starting the pre-order campaign:
Engage with customers and build excitement around pre-orders.
This can be done through targeted marketing efforts like email campaigns, social media posts to social media followers, google ads, and in-store promotions.
Choose the products that you want to offer on pre-order.
You need to decide which of your products you want to run on a pre-order basis; that is if you sell more than one type of product.
You may want to consider the profit margin, the length of time it will take for the products to arrive, or the market size and demand for the product.
Determine the pre-order price.
The price you fix should be enticing enough for potential buyers to want to drop money as payment now yet wait for a future delivery date.
You also need to consider your cost price as well as how much profit you want to make.
It is important to balance profitability with customer interest, and you may need to experiment a bit before finding the right price for your products.
Set pre-order launch dates and release dates.
You will also need to decide on pre-order dates, which is the time period that pre-orders are open and when the preordered products will be released putting in mind the shipping date. This will allow you to better manage customer expectations.
Advertise your pre-orders.
Make use of social media, press releases, email marketing, or any other channels that you have to let your customers know about the pre-order opportunity. You need to make sure that potential customers are aware of the pre-order so that they can take advantage of it.
Fulfill pre-orders on time.
It is important that you fulfill pre-orders on time so that customers are satisfied with their purchases. This will help to build trust and confidence in your business and encourage customers to pre-order from you again in the future.
Follow-ups and feedback.
It is not just enough to pre-order and move on. You need to get feedback on the products delivered, time taken or any issues the buyers may have encountered. This is to help you make corrections when next you want to run pre-order sales.
Some best practices for pre-ordering include
These are just practices to put in mind when you decide pre-order model for your marketing campaigns.
Offering pre-orders at a discount
One way to increase interest and excitement in your pre-orders is to offer them at a discounted price.
This will entice customers to take advantage of the pre-order and order the product before it is released at full price.
Creating a pre-order landing page
Creating a dedicated pre-order page on your website or online store can help increase interest and sales, use this page to promote your pre-orders and provide information about the products, pricing, and release date.
Offering pre-order incentives
You can also offer pre-order incentives, such as free shipping or bonus products, to further entice customers to pre-order your products.
Monitor for performance
It is important to carefully monitor pre-orders and product performance so that you can make changes as necessary. This will help ensure that your pre-order campaign is successful and that you are able to meet customer demand.
How can pre-ordering help businesses track customer interest in new products
Pre-ordering can help businesses track customer interest in new products by allowing businesses to gauge whether or not customers are likely to pre-order a product.
This can be done by monitoring pre-order sales, customer feedback, and social media activity.
By tracking this information, businesses can adjust their marketing and production plans accordingly to ensure that they are able to meet customer demand.
Additionally, pre-ordering can help businesses identify new trends and ensure that they are able to stock the products that customers are most interested in.
Downsides to pre-order launch
A pre-order strategy can have some downsides for businesses. For example, if a product is not released on time or as expected.
Additionally, pre-ordering can be a lack of control – When you pre-order, you are giving up some level of control over the product. For example, if there are changes to the product before it is released, you may not be able to adjust your pre-order product accordingly.
Pre-orders can be difficult to manage, especially if you are offering pre-orders for multiple products. You need to ensure that you have enough inventory on hand to meet customer demand and that products are released on time.
High financial risk
Another downside of pre-ordering is the high financial risk involved. If products are not pre-sold, businesses may be stuck with excess inventory that they are unable to sell.
Potential for customer loss
When using pre-order marketing; especially if a product is not released on time, businesses may lose pre-order customers who may have been angered by the delay. This can also negatively impact brand loyalty. So they need to be vigilant about monitoring pre-order activity.
To have a successful pre-order campaign, it is important for e-commerce businesses to carefully plan and manage their pre-order strategy.
This may involve developing a pre-order strategy that factors in the product type, target customers, price point, and release date.
It is also essential to track pre-order performance, and marketing costs and adjust as needed to ensure customer satisfaction and meet demand.
Additionally, businesses should consider offering pre-order discounts or incentives to further entice customers to pre-purchase products.
Overall, pre-order marketing can be a great way to boost sales and profits for your business, but it is important to carefully consider the risks and challenges before embarking on a pre-order campaign.