Staying Resilient in 2022 from Inventory to Inflation

Black Friday is over and retail marketers are already planning for Spring. But what if the products you’re planning on promoting don’t show up?

If we’ve learned one thing over the past few months (give or take a year), it’s that the best protection you have against generic, irrelevant marketing and unhappy customers is agility. Forget all of the bells and whistles available to retailers with modern marketing. We’re in the middle of a macroeconomic shift — if they don’t help you stay agile with easy access to your customer data, those bells and whistles won’t matter. 

And the global supply shortage was only the beginning of that shift.

In October, the inflation rate rose higher than it has in 30 years. The impact of the global supply shipping shortage is hitting consumers, because of the rising associated costs for retailers and manufacturers. This creates a trickle-down effect from the crate shortages in China all the way to the prices of the shoes on your feet. Since the inventory shortage is here to stay, it’s likely that inflation will continue to rise as well. 

Rising prices and high demand puts retailers in an unusual position, with a lot of associated risks — how high will costs rise? When will I get my inventory? How will I get products out to shoppers with slow deliveries? How will shoppers respond to rising prices? Large retailers and small brands alike are feeling the impact, with larger retailers paying high prices to get products to shoppers on time, and smaller brands remaining at the mercy of shipping providers. 

Right now, shoppers are buying amid rising prices with retail sales rising 1.7% in the face of inflation. 

But while the dollar might be losing value, that doesn’t mean your shoppers should.

4 Ways Your Business Can Be Agile

With some creative thinking, retailers were able to mitigate some of those inventory issues. But what do you need in 2022? The name of the game here will be quick pivots to keep up with the shifting environment.

Here are some tips to help you become more agile – and ready for anything.

1. Be ready to tighten your planning cycles

Retail marketers love planning — the further out the better. But after the uncertainty of the global supply shortage, retailers found their planning cycles growing smaller and smaller to make sure they were only promoting items that they would actually have in hand. With real-time visibility and access to your product catalog data, you can contextualize it with shopper data in real time to be prepared for inventory and pricing changes.

Living product catalogs do more than give you the ability to pivot your messaging quickly and update your ecommerce site when there are updates to stock status in real-time. It will also give you the ability to offer up alternatives to shoppers based on their product preferences that are in stock like size, color, and style. NOBULL is a good example of this. With real-time updates to their product catalog, they were able to stay ahead with their advertising to match shoppers with in-stock products and eliminate the chance of any ads being displayed for products that were out-of-stock. With a living product catalog, you can plan confidently knowing that the wrong product won’t get pushed out to shoppers without taking on additional manual work.

2. Rethink your CDP

The shortening of those planning cycles impacts the speed at which you need to activate data. So it might be time to rethink your customer data platform (CDP). 

Think about all of the information in your CDP. Alone, it’s great. You have all of the information on your shoppers you need in the system for a complete view. But shopper data alone won’t help you get where you need to go and it certainly won’t keep you moving quickly. Critically, CDPs are missing two things: the ability to act and deep insight into the product.

A full view of the shopper alone won’t be enough to stay ahead in 2022. Without visibility into your product catalogue with all of that information on inventory levels and stock status, the complete view of the shopper isn’t enough to act and accelerate your business. Does this mean you should scrap your CDP? Absolutely not. Instead, think about what you can do to better enable your marketing team to activate this data and turn it into an amazing customer experience.

Another one of the easiest ways to stay agile is simply usability. Marketers need to access and activate data quickly from insight to execution — in a language and format that they can understand. When you’re evaluating your retail tech stack in the coming year, make sure that the solutions you’re looking for will have that level of insight and usability so your team can act quickly.

3. Up your loyalty game 

Now that holiday planning is over, it’s time to start thinking about how you’re going to keep all those new shoppers. Shoppers are most likely to purchase a second time within the first 100 days of making a purchase, and 74% of your shoppers are one-time buyers. Add in the fact that the jump in lifetime value between a first and second purchase is 57% and those buyers become incredibly important.

It’s much less expensive for brands to focus on the shoppers they already have, rather than focusing on the endless pursuit of net-new shoppers. Retailers now have a whole trove of data on this year’s holiday shoppers. So why not activate that shopper data that you already have to drive sales into 2022 and increase customer lifetime value? 

This year, 52% of shoppers were first-time buyers on Black Friday. Retailers can re-engage those shoppers and activate that data across channels — even channels generally used for acquisition. With personalization, retailers can reactivate that revenue and invite all of those holiday shoppers back in 2022 or drive their 2nd purchase in the Spring or sooner.  

The impact and desire for personalization is only stronger. 78% of consumers say that personalized content leads them to a next purchase. The more interactions between a consumer and a brand means more data, creating experiences that get stronger and stronger with each interaction on an endless loop.

4. Partner up with payment plan providers

With inflation rising, giving shoppers flexible payment options will be key going into 2022. Payment plan providers like Klarna and Affirm will help shoppers buy flexibly and make them feel comfortable when they’re closing on that purchase, especially for higher priced items.

Already offering flexible payment plan options on your site? You should also extend those pricing options beyond your ecommerce site to other channels. By pairing your marketing automation with payment plan pricing and extending that visibility into flexible options that your brand provides, you can get the message out there that those options are available while pairing them with products that shoppers will love. The less friction for a shopper in making a purchase, the better — and getting shoppers to buy again and again will lead to loyalty. 

Are you ready for 2022?

Obviously, this has been a challenging year for retailers. But the reality is that global supply shortages are probably going to stick around into 2022 and inflation will likely continue to stay high. Waiting for the industry to even back out isn’t going to work. 

Retail moves with all of those economic and environmental ebbs and flows. By orienting your business toward agility and efficiency, you can weather the changes.