Marketing, Sales & Service

Flash Sales: Where Smart Marketing Meets Supply Chain Strategy

20131118-105923.jpg

Online flash sales have become one of the most popular and important new marketing tools in the hands of web retailers. In customers they create a sense of urgency – with a limited time window and/or quantity: if you like it, buy now or risk losing the opportunity forever.

Offline, companies like Zara have trained customers to know that if they like something in store, they should buy it because it may not be back. Online, sites like fab.com and gilt.com have brought flash sales to clothing and fashion accessories.

Though it is not widely recognized as such, flash sales have come to the electronics industry as well. Sites like Kickstarter and electronics companies like Xiaomi are making flash sales a regular part of their business. On kickstarter, projects are time limited – order your item in the 30 day window or you may wait months longer for another opportunity – if ever. Xioami, the fast-growing Chinese phone maker, has also used time and volume limited sales to drive excitement for new model launches.

What’s not often recognized is how useful and elegant flash sales can be from a supply chain perspective. One of the most difficult things to do in an on-going business is managing replenishment and production run-rates. Managing production run rates to adjust for demand, marketing, and new product introductions is very complex, all the more so when dealing with a new product introduction with an unknown demand profile.

Flash sales get rid of all that complexity, replacing run-rate and replenishment planning with a one time buy from customers and a one-time buy for the supply chain operation as well. When the sale is done in advance of production, risk is minimized and the whole process demands no working capital. Even when done as a one-time sale post-production, complexity is minimized since anything that doesn’t sell gets marked down until it does.

Flash sales are not without risk or challenges. Successful ones often have the effect of “leaving money on the table” – demand that was unfulfilled. In electronics, plans still need to be made for repairs, service and warranty. Even so, as a means of building anticipation and simplifying supply chain complexity, they’re hard to beat.

 

Vice President & Global Industry Leader, Electronics

More stories

Enabling Cross-FAB Operation Capability in MES

It is not uncommon to see the multiple-FAB configuration in modern semiconductor manufacturing site construction that two or more manufacturing FABs are closely built in location with catwalk, pathway, or tunnel linkage to each other (Dual-FAB is most commonly seen). With this specific construction configuration, the shop floors in both manufacturing FABs are inter-connected which […]

Continue reading

Social Marketing Strategy 2020

Changes in the digital landscape mean marketing departments need to do more to ensure they’re getting their message across. Two -thirds of electronics companies either have a limited strategy, or no strategy at all, for integrating digital in their businesses – despite the fact that the number of social network users around the world is […]

Continue reading

Customer Analytics – Are you focused on smarter interactions?

Using analytics to select the right product for the customer is almost de-rigueur for many verticals like telecom, retail and banking. But is it improving the customer interactions? Customer analytics has been evolving rapidly in the past decade.We can break up this evolution into two broad phases. The first phase was focused on descriptive, offline […]

Continue reading