Unlocking the power of personalisation to reduce overstock risk

It's no secret that ecommerce has an overstock problem. Despite the online shopping boom, brands are still struggling to shift their products off the shelves and are finding themselves stuck in a cycle of misjudging customer demand, over-ordering and therefore overcompensating.

Of course, this isn’t great for health and wellness retailers. Excess overstock results in spending precious cash on new products (and the space to store them) without selling enough to recoup the costs. In fact, research by fulfilmentcrowd showed that health, lifestyle and supplement brands have increased their storage capacity by 18% over a 12-month period. yet, have only seen a sales uplift of 13%. Clearly, something’s not matching up. 

However, do not despair, for there is a glimmer of hope. By directing your attention towards your current customers, who are already loyal supporters of your brand, and enchanting them with a personalised experience, you can craft an unforgettable unboxing encounter. This approach is certain to foster customer loyalty, as they will be enticed to explore additional products. As a result, not only will your sales soar, but you will also effectively minimise excess inventory.

This blog post serves to dive deeper into how health and wellness retailers like yourself can break the vicious cycle of overstock and increase profits whilst doing so. It’s a win, win!

Personalisation: The answer to your overstock prayers

When it comes to keeping your existing customers happy, personalisation is key. Why? Because when you take the time to create a tailored experience just for them, it shows that you really care. When your customers feel valued, they feel less like consumers and more like a part of a community, resulting in repeat purchases. In fact, research shows that a staggering 65% of customers feel more loyal to brands that personalise their experience.

But how does all of this help you tackle the problem of overstock? By offering your customers a personalised experience, you're also opening the door to showcasing more of your inventory. And since your loyal customers already trust your brand, they're more likely to take a chance on your other products and help you clear out those shelves. This means more sales, less overstock, and less money tied up in products that aren't moving.

So, how can you use personalisation to create experiences that keep your customers coming back for more? In the next section, we'll share three practical tips that you can start using today.

How to use personalisation to shift overstock

1. Targeted product recommendations

The first way to use personalisation to shift overstock is to dive deep into your data analytics and better understand your customers’ browsing and purchasing habits. 

With the decline of third-party cookies, you may need to use more creative ways to collect this data. Dr Sams, a skincare brand, asks its customers to complete a routine finder quiz on their in-package inserts. This way the brand can learn more about their customers’ skin types and preferences.

Once you’ve collected a rich data profile on your customers, you can serve them personalised product recommendations across the whole customer journey – from the on-site experience through to your post-purchase emails. 

During the unboxing experience, recommend products that appeal to your customers’ interests to make them feel valued too. This moment can create a significant impact on repeat sales, resulting in a £2.20 return on each package. Warner’s Distillery, for example, serves personalised product recommendations on their in-package flyers, suggesting their gin tumbler to their gin-loving customers.

2. Cross-selling

The second way to use personalisation to clear overstock is to suggest to customers complementary SKUs to the products they’ve already purchased. For example, if your customer has bought a powder supplement, show them the shaker that goes along with it. Or, recommend them the next best step in their skincare routine. 

You could also show a discount alongside your cross-sells to motivate customers to buy the related product. 

For example, the skincare brand, Yepoda, uses the unboxing moment to cross-sell their lotions to customers who have bought their best-selling serums, with an attractive 15% discount. The messaging calls out that the customer may be concerned with signs of ageing and that “The Cream Team” products they're recommending also combat this concern.

Similarly, Bird & Blend Tea Co use their unboxing moment to motivate customers who have made two or more purchases to try their Matcha Tea. The insert includes the benefits of Matcha and a QR code that links to recipes for more ways to use the product.

3. Use social proof

Finally, don’t underestimate the power of social proof. By featuring genuine content from real people in your marketing, you’ll create a more personal experience for your customers. This builds trust and makes shoppers more likely to try your products. 

One effective way to do this is to use reviews and UGC from happy customers when you’re cross-selling. For example, to help sell their haircare oil, ARKIVE, uses social proof about the product in their unboxing campaigns. This way, when a shopper buys their best-selling shampoo or conditioner they’re shown a review of the oil. This social proof builds trust and the customer is more likely to try the product in the spur of the moment.

You could also use the unboxing moment to ask your existing customers to leave reviews and create social proof for your difficult-to-shift products. This social proof can then be used in ongoing campaigns to help validate the credibility of the products you have overstock of. 

fulfilmentcrowd already support a plethora of brands that a capitalising on incorporating additional collateral into their packages to enhance the unboxing experience.

Take a look:

the big silk use pretty pink inserts with aesthetic typography and clever play on words that their customers will want to keep.

Mission's inserts perfectly match their brands voice, whilst educating consumers on the brands story.

By sending out their catalogue with each order, Ivy Rose double their chances of customer retention.

Apolina's packaging creates for a memorable unboxing experience, making customers feel part of something bigger.

By using a vibrant pop of colour and powerful messaging, Calla leaves an impression on its customers.

Conclusion

Dealing with overstock can be a daunting task. The good news is that you can solve an overstock problem by using personalisation to create a high-end, tailored experience for your existing customers. 

With personalisation, you can direct your customers to more SKUs across your inventory and increase their trust in your other products, resulting in more sales and reduced overstock. In practise, this means finding creative ways to serve personalised product recommendations, cross-sell and upsell. 

Do this well and you’ll not only reduce overstock, but also earn customer loyalty and long-term revenue for life.

This blog was co-written with our friends at Penny Black.

About Penny Black

Penny Black is the only marketing channel with a 100% open rate and that allows brands to use the unboxing moment to retain customers, increase CLTV and build brand loyalty. Their platform and print tech allows ecommerce marketers to create hyper-personalised campaigns and inserts that can be added to their packaging during the pick-and-pack process. Their inserts generate £2.20 in additional revenue per inserts.