With eCommerce growing at such a rapid rate, you’re probably eager to get out there and grab your corner of the market.
But there’s one problem that seems to keep getting in the way: cash flow.
Money woes are widespread among sellers who pay for inventory upfront, especially if they’ve made inventory mistakes that led to overstocks. If you fall into this camp, you’re not alone. 54% of budding businesses say cash flow concerns hold them back, and at one point overstocks cost the global economy a terrifying $471 billion. 😲
Luckily, pre-order sales are here to offer a clever workaround and help you establish products without emptying your bank accounts.
But what are pre-orders all about? And more importantly, how can you get your business involved?
Join us as we get stuck into why pre-sales are a lifeline for ambitious sellers, and share some tips and tricks to ensure your pre-order campaigns help scale your business. Let’s go!
Pre-order Sales: What We’ll Cover
- What Are Pre-Order Sales?
- Why Run Pre-Order Campaigns for Your Ecommerce Business?
- How to Increase Pre-sale Orders with Buzzworthy Campaigns
- Figure out what you want to pre-sell
- Make an irresistible offer
- Choose a sales channel that sets you up to win
- Optimize your pre-order purchase sequence
- Market early and remember your superfans
- Choose the right funding option
- Commit to testing
- Quick Tips for Drama-Free Pre-order Sales
- The Right Way to Run Pre-Sales and Explode Your Growth
Ready to scale your business with pre-orders? Scale your vision with flexible and transparent eCommerce funding.
What Are Pre-Order Sales?
A pre-order sale (aka pre-sale) involves listing items for sale on your eCommerce channels before officially launching them. Most times, the goods are yet to go into production, and some might even be in the development stage.
Pre-orders offer customers the opportunity to get early access (and even early-bird discounts), helping the product gain more traction. In turn, you get to understand what your customers are into today and you’ll get to make some cash nice and early in the game. It’s win-win.
Why Run Pre-Order Campaigns for Your Ecommerce Business?
If buying stock upfront works well for your business, you might wonder why to bother using pre-sales to fund your growth. But your success using the traditional sales model is the very reason to pre-sell.
If you have the customer base, products, and channels already set up, you’ve already done most of the heavy lifting.
Here are a few of the major benefits pre-sales offer:
- Understand your business’ stock requirements: Pre-orders are a fantastic way to validate product ideas, test new markets, and gauge demand. They also have the added benefit of giving you insight into your inventory needs before you invest, so you can make more accurate purchasing decisions.
- Fund your projects: One big concern for eCommerce sellers is how to fund their ambitious dreams. Pre-order sales provide a solid way to protect your cash flow and drum up funds for production runs, marketing the product, and even future projects.
- Create hype around your brand: Pre-sales help build a sense of exclusivity and ‘being first’ to entice and excite your target audience. Before you know it, your customers tell their friends, who tell their friends, and you sell out in minutes. 🤑
- Pre-sales are flexible: Pre-orders are for more than just product launches. You can also use them to do things like:
- Debut seasonal and limited-time products like Mother’s Day presents.
- Support big sales and promotions on existing items.
- Highlight a product in your core range.
- Reduce your risk: Pre-sales can help you dodge overstock-related issues as you won’t have to fork out for stock upfront. Plus, you have the option of waiting to see whether your product is a hit or miss before taking the plunge.
Think your store could do with the extra cash from pre-order sales? Find out how SellersFunding can help you get set up.
How to Increase Pre-sale Orders with Buzzworthy Campaigns
To craft a fantastic pre-order sales campaign that gets your customers raving, you’ll need an equally awesome plan.
Let’s get into the key steps you need to smash your pre-order sales:
Step #1: Figure out what you want to pre-sell
To bag your first pre-order sales, you need to focus your efforts on developing attention-grabbing items that will get people talking.
If the product has viral potential (e.g, a product that’s the first of its kind), even better. For example, Apple regularly launches new releases on pre-order, and in 2020 the iPhone 12 sold a staggering 800,000 units in just 24 hours!
Here are some questions to ask before creating a new pre-order product:
- Who will this product serve?
- What makes this product better than what’s already on the market?
- Can we market this item on popular social media platforms?
- Do we have enough time to develop this product?
Step #2: Make an irresistible offer
To close more pre-order sales, make your offers so tempting that site visitors will gladly queue for them. For inspiration, think of the Black Friday-style deals that get customers so engaged they’re waiting in line hours before opening.
To add extra value and ensure shoppers can’t resist, you could also limit the number of people who can claim the pre-order deal, or run different discounts throughout your campaign.
Here are a few more tips to get shoppers flocking to your store:
- Offer limited edition products.
- Use a “buy one get one free” offer.
- Heavily discount pre-sale products.
- Give free quality add-on items.
- Provide limited-time promotional bundles.
- Arrange heavily discounted subscriptions.
- Offer a percentage off their next order.
- Give entry into a draw to win X-months-worth of product.
For an extra kick, look at the offers your competitors are putting out, then find ways to outdo them to make buying your products the single best option for shoppers.
Step #3: Choose a sales channel that sets you up to win
It’s important your sales channel facilitates pre-sales and has the right features to help you collect orders, track pre-sale campaign’s progress, and drive important conversions.
For example, on Shopify, you can integrate a pre-order sales app and gain access to features like countdown timers, partial payments, and mixed cart alerts (for when someone buys an in-stock and pre-sale item at once).
Depending on your goals, you can even consider crowdfunding platforms like Kickstarter and Indiegogo which allow you to pitch your product ideas to individuals for funding. Remember to assign enough budget for high-quality marketing campaigns, which are vital to stand out from the crowd, and watch out for crowdfunding platforms’ fees (they can go all the way up to 12%).
Step #4: Optimize your pre-order purchase sequence
From upsell apps to chatbots, there’s no shortage of ways to improve your pre-order sales sequence to boost sales. Here are a few options:
- Embrace fast, responsive page designs: Keep and convert as much traffic as possible by making sure your store loads quickly and is easy to understand. 6 out of 10 consumers begin shopping on one device and complete their transactions on another, so implement both desktop and mobile responsive designs.
- Develop a cart recovery strategy: Abandoned cart email campaigns are vital to recover sales from customers who left before completing their orders. A tiered discount system that increases the discount as time progresses can work to reel potential customers back in.
- Do a test run before launch: Before launching, trial your pre-order sales journey and ask testers for feedback. Then use heatmaps from companies like Hotjar and Crazy Egg to track customer behavior post-launch. You can use your insights to tweak your pre-sale page over time.
Step #5: Market early and remember your superfans
To increase the odds of pre-order sales going through the roof when you launch, you need to prepare in advance. For example, if you give yourself 90 days instead of 30 days to warm up prospects, you’ll have a greater chance of succeeding.
To nail your pre-order launch, make sure you:
- Create campaigns for lead generation and remarketing to cold audiences.
- Diversify your marketing channels, e.g, Instagram, YouTube, Facebook, and email.
- Set up a post-sale email sequence to keep customers engaged and reduce buyer’s remorse.
- Dedicate resources to call out your past customers.
- Incentivise referrals requests throughout your campaigns.
Finally, remember no one will have your back like your super fans when it comes to pre-order sales, so create marketing campaigns that speak directly to them and then watch them come out in full force. 💪🏽
Step #6: Choose the right funding option
To get your ideas off the ground, look for a flexible eCommerce funding source that will allow you to use the cash for anything related to your business.
Working capital funding works well for these projects. For example, at SellersFunding, eCommerce sellers can get credit or a revenue advance from our working capital solutions. Online store owners use these for many tasks like buying new inventory, stabilizing cash flow, and marketing expenses.
Whichever funding option you choose, set it up before you go full steam ahead on your idea to avoid any cash shortfalls.
Step #7: Commit to testing
As much as we want to have a huge wait list and maximize sales on D-day, remember that at its core, a pre-sale is a test drive before you commit 100% to a product. Here’s how to use this to your advantage and let your creativity run wild:
- Create a minimum viable product.
- Explore different products and packaging.
- Try out different product descriptions, email campaigns, and ads.
If a product doesn’t take off, don’t lose heart. See it as an insight that has saved you money because you didn’t invest a large sum into stock. Now you’re free to invest your resources into the next swing.
Quick Tips for Drama-Free Pre-Order Sales
- Set a clear returns policy for pre-orders to make sure you don’t end up with too much stock on hand. A clear returns policy will also help prevent you from paying for refunds because buyers changed their minds. E.g, you could offer a credit note instead of a cash refund (if this is permitted in your territory).
- Don’t forget about taxes: Budget taxes into your pre-order prices so you can pass the bill to your customers. For example, Amazon’s pre-order sales tax is real, and you’ll want to price it into your products alongside Amazon’s fees.
- Track your expenses: While this project may be less capital-intensive than others in your business, it’s still important to set a budget and keep an eye on spending, so you can price competitively without selling at a loss.
The Right Way to Run Pre-Sales and Explode Your Growth
Pre-sales offer a great way to dip your toe into the eCommerce waters without fear of drowning if your idea fails to inflate. And if it’s a success, you walk away richer. 👍🏼
The right pre-sales campaign will help you get paid for product ideas before they start racking up costs, uncover new products your customers love, and can even be the starting point of a solid revenue source.
Look for interesting items to help grow your brand, and who knows — your next pre-order campaign might be the vehicle that skyrockets your sales.
Need eCommerce funding to kickstart your pre-sale story? Find out SellersFunding can help.