Prepping Your Business for Overnight Success in a World of Kardashian Endorsements
After spending months — or in many cases, years — toiling over the many aspects of bringing a product to life, it’s every retailer’s dream for that product to be adopted by consumers with hefty enthusiasm for their business. In the past, this excitement was likely to build gradually over time through word-of-mouth endorsements or planned placements in new brick-and-mortar locations. Today, however, it’s possible for retailers to be rocked overnight by unplanned or unexpected jolts in order volume — and many aren’t prepared for the aftermath of simply having too much demand for their product.
Many retailers have experienced this phenomenon after an appearance on ABC’s popular show "Shark Tank," which allows entrepreneurs to pitch their products or ideas to investors. Others meet unanticipated fame after a celebrity discovers their product and posts about it to hundreds of thousands of social media followers. Sometimes, a marketing campaign put out by the retailer itself simply reaches a far greater audience than expected.
In today’s world of celebrity endorsements and viral campaigns, overnight success can quickly crumble business plans, inventory counts and a customer’s buying experience. Karl Stark, chief executive of Avondale Strategic Partners, a strategic advisory firm focused on building and growing companies, said, “we talk about catastrophic failure. Catastrophic success is equally an issue.” Catastrophic success occurs when retailers are unprepared for a surge in orders that results from unplanned or unanticipated promotional activity. So, what can retailers do to ensure their own rapid success doesn’t lead to disgruntled customers or, even worse, their demise?
Ask the Right Questions
While overnight success isn’t the norm, the best rule of thumb for growing any retail business is to prepare for anything. Talk with your manufacturing facility, warehouse manager(s) and any other partners you have to discuss a game plan for what would need to happen if you were ever to see a massive, unexpected spike in sales. Can you establish an up-front cost for additional services or goods so you both know what to expect if you need to boost production temporarily? If you’re evaluating a software platform to help you maintain your online store or manage your inventory, will it provide you with an account manager or other hands-on help should you need it in a hurry? While it’s impossible to fully prepare for overnight success, doing your research and having a plan will never hurt should the time come to put it in motion.
Find Support Early
When you’re evaluating technology solutions for your business, have conversations with vendors about their capacity to support rapid growth. You’ll need an e-commerce site that can handle an unexpected increase in traffic without crashing, a secure point-of-sale (POS) system, reliable fulfillment, as well as an inventory management system you can rely on to automatically handle backorders and an unanticipated influx of orders. Michelle Garza, vice president of operations of Flash Tattoos, said, “pop-up shops, flash sales and celebrity collaborators are very exciting both for our team and our customers, but they can also add a level of uncertainty to our inventory and operations. Our technology stack is critical to ensuring everything goes smoothly whenever we have a launch, sale or special event.”
Before a product launch or new marketing campaign, make sure you’re in touch with these vendors so they can best prepare for your success. Additionally, when you have a centralized hub through which systems talk to each other and data is collected, you’ll have more visibility into why and where demand is coming from. Sometimes it’s a single source like "Shark Tank," while in other cases you may be surprised to find a magazine has listed your product in a top-10 list, driving new (and perhaps temporary) demand. While you cannot predict the unpredictable, you can use data to make more informed plans when it comes to inventory.
Communicate Strategically With Your New Customers
Should your retail business experience overnight success, remember that an inundation of orders means an uptick in new customers. It might seem daunting that their first experience with your brand is happening when your team may be feeling disorganized or unprepared, but it’s important to see any new customer as an opportunity to build trust and establish loyalty. If you’re overwhelmed with orders and know shipments are going to be late, communicate that as quickly and clearly as possible. Remember that this is many customers’ first interaction with your brand, so be as transparent and helpful as possible. People appreciate honesty as much as they’ll appreciate that you didn’t compromise your product’s quality just to fulfill items faster. This is also a good opportunity to target your new customers with relevant content and special promotions.
While some events, like a Kickstarter campaign or an appearance on "Shark Tank," might provide you with the opportunity for more advanced planning, a viral campaign or sudden celebrity endorsement have the capacity to shake your business operations overnight. While rare, it’s important for retailers to recognize overnight success as a possibility and plan accordingly.
Even if your business never experiences unexpected increased demand, your team will benefit from these tips as they pertain to gradual growth or even seasonal peaks or events such as the holidays. When you’re aware of your historical sales data and can also account for unintended, unrepeatable spikes in demand, you’ll be able to more accurately plan for the future. Whether you’re frantically addressing a never-ending order queue or simply assessing how best to plan for demand, it’s never a bad time to do your research, implement software to increase accuracy, and think strategically about how you communicate with your customers.
Brandon Levey is the CEO of Stitch Labs, an inventory management solutions provider.