8 ways retailers can move surplus inventory during COVID-19
While these strategies are particularly valuable now, they can be applied any time surplus inventory is an issue.
Retailers have been forced to adapt to a new marketing landscape in light of COVID-19. Some retailers have successfully pivoted to new consumer demands, leveraging their marketing channels to connect products with the shoppers who need it most.
But there are new challenges emerging, particularly as retailers balance their marketing efforts with inventory management. For some retailers, products they anticipated would move quickly prior to COVID-19 risk sitting in a warehouse unsold. In the apparel vertical, retailers may face new challenges to sell out spring collections and promote their summer catalog early to compensate for lower demand.
In the short term, retailers with surplus inventory are looking to adjust their goals on marketing platforms like Google Ads and Amazon and develop a plan to sell products quickly. Sidecar is seeing several trends emerge, and we have identified the following best practices to consider to move surplus inventory and adjust to new shopping behaviors in light of COVID-19. While these strategies are particularly valuable now, they can be applied any time surplus inventory is an issue.
1. Develop a surplus inventory campaign
Create dedicated campaigns for excess inventory on Google Shopping and Google paid search. These campaigns should have a lower ROAS target to allow you to set higher bids and deliver ads to a larger audience.
Choose specific products types to prioritize and develop a surplus inventory strategy for each. Lowering ROAS goals will give your team flexibility to test different strategies and determine which works best for different products. Set a timeline for how long you want to push certain products so that if a product isn’t doing well, you can reduce spend and focus on the more valuable parts of your catalog.
2. Consider new ways to target shoppers
While you should always layer granular targeting into your Google Ads campaigns, consider new ways to reach shoppers during this time by adapting demographic, dayparting, and geotargeting settings. For example, some older shoppers who typically don’t shop online could become a valuable demographic as their online shopping activity increases. Different times of the day may become more valuable to advertise your products as shoppers’ behaviors shift. Monitor these trends closely to ensure you’re targeting excess inventory to the audiences with intent to purchase your products right now.
3. Rethink your promotions calendar
You may have planned to promote certain products, such as summer apparel, in the coming weeks on Google Ads, but other products from your spring collection may be undersold. Make sure to align your promotions calendar with your inventory surpluses. That may mean running full-site promotions, changing the products that are on sale, or running longer promotions all together to ensure excess inventory is sold.
While promotions will be an important part of retailers’ surplus inventory toolkit, it’s important that your messaging is sensitive to the difficult period that some consumers are facing. Be mindful of those challenges when developing promotion creative and ad copy.
4. Closely monitor keyword performance
It’s more important than ever to track keyword performance across campaigns. As stay-at-home orders have increased and grocery stores have run out of stock of certain items, there has been an influx of unusual search term traffic in multiple retail verticals. Shoppers have been searching for cleaning supplies, like “hand sanitizer,” and also ingredients to make their own, like “aloe vera.”
An uptick in at home baking, a reaction to low bread supply in some stores, has made search terms like “yeast” increase exponentially. Shoppers are adapting to supply and getting creative in how they access or even create the products they need. This search behavior will likely continue into May and beyond, so make sure your keywords are relevant and direct to the appropriate products.
5. Update ad copy and landing pages for paid search
In addition to updating keywords, align paid search ad copy and landing pages to new shopping behavior. For example, if you sell games and puzzles, you may see much higher engagement than typical, and these products may deserve a dedicated landing page and fresh ad copy to better align with customers’ needs.
6. Consider testing Amazon Advertising if you’re not active yet
Many retailers use Amazon and Amazon Advertising to push unsold inventory. If you have yet to use this platform, now may be a good time to test its effectiveness. Amazon could provide a quick solution for your surplus inventory needs and help you reach new audiences. Factor into your budget additional costs associated with selling on Amazon, including seller fees and commissions. Retailers should plan to use Fulfillment by Merchant (FBM) because of the limits Amazon has set on Fulfillment by Amazon (FBA) products.
Like Google Ads, you should develop a dedicated inventory campaign on Amazon so that you can loosen goals and put additional budget toward pushing inventory. These separate goals can also expand the search terms you target and set more aggressive bids.
7. Use coupons to stand out on the Amazon SERP
To add more visibility to your products on Amazon Advertising, consider adding coupons to your surplus inventory products. This will help your products stand out on the SERP and give customers an incentive to purchase from you. This is particularly helpful if multiple retailers on Amazon sell your product.
8. Watch for Prime Day developments
Amazon is reportedly delaying Prime Day to at least August, though an exact date has not been set. Retailers who are active on Amazon Advertising, or who become active due to COVID-19, should monitor updates surrounding Prime Day timing. While we find that it can deliver a revenue boost for some retailers, having a smart strategy all year long that aligns with consumer demand is the best approach for success on Amazon Ads.
Retailers don’t need to be stuck with excess inventory. With a flexible plan, sophisticated targeting, and regular evaluation of shopping behaviors, retailers can stay ahead of the shifts presented by COVID-19.
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