How to maximise your profit: Promoting trending products on marketplaces
Recently, Web Retailer published an insightful post on making profit with Amazon trending products. As the article makes clear, watching trends requires precision and speed so you don’t hit the market when it’s too saturated. Trends, as the name suggests, are temporary. Once they are out of fashion it’ll become hard to sell them. By working promotions into your marketplace strategy, you’re creating an emotion in customers that makes them want to buy more from you, right at that moment. It got us thinking, how can retailers take these trends and then use promotions to maximise their sales on marketplaces?
As Pilar Newman aptly puts it, trends are found all around us, you just have to keep on top of them and act fast. Knowing when specific calendar dates fall is also useful when tracking able to tracking trending products. What are the best sellers? What are the poor sellers? How fast are the items selling? What’s happening across the different channels and regions? How profitable is each product? Are they trending up or down? To do this you need a tool like the Volo platform that can help you manage your performance and set targets around this.
Bundling and packages
“Let’s say you want a sanding machine. We’ll offer you the machine, but the Volo system also allows us to cross-promote with a bundle, so we can add 6 months’ worth of sanding belts for a couple of quid more. 50% of all our sales come from bundles; it’s that important to us. In the last 12 months alone our sales have increased 29%, which was our ninth year in business, and our eighth as Volo customers. You’d need an army of people to do that without this system.” – Bamford Trading
The simplest way to encourage buyers to purchase another item from your store, is to add another complimentary (related) product to the order. This could be anything from the next film in the DVD series, a case for an iPhone or laptop, or a cookbook to go with a new saucepan. You’ll be able to increase the order size as well as promoting products that might not have got a look in before being attached to something else. Kits and bundles are a great way to increase your average order value, as well as demonstrating a great service to buyers by creating product packages which make sense to them.
Buy one get one free
You can also make your first item products more attractive by offering a ‘buy one, get one free incentive’. If you can’t manage to give away a free item, try ‘buy one get 50% off’. These initiatives make it easier to move extra numbers of a certain product that needs to be a high margin so it makes it profitable for the retailer to make the offer.
It’s not just Amazon
eBay also offers you promotions. Last year, eBay conducted a case study of one of their sellers over a 10-week period and found that with eBay Promotions Manager, the average basket size had jumped from 1.1 items to 1.94 items, close to doubling revenues. To use the tool, you should again analyse your sales performance and short-list your best selling items using a reporting tool. You can then look through you inventory and determine low selling SKUs which have a decent margin and which you can give a competitive price. By seeing what’s trending, you’ll be able to pair your best sellers with less popular products and create a discount offer. These ‘long tail’ products will then be shown on your best seller listings.
Watching out for trends is a good idea in principle, but not acting on them with efficiency and speed will prove them to be worthless. By including promotions in your selling strategy, you have a key device for encouraging extra sales. Amazon and eBay Promotions Manager are geared to help sellers move more products on their marketplaces. So by being creative with your items and putting two and two together (literally), you’re on your way to fully maximising your sales profit.