How to Sell Clothes During a Supply Chain Crisis

How to Sell Clothes During a Supply Chain Crisis

Fashion’s supply chain issues create unique challenges for industry marketing departments: how do you convince shoppers they need last season’s clothes when they finally hit stores?

That’s the scenario Untuckit faces, counting down the days its spring shipments get stuck in the congested port of Los Angeles.

“It could take another two weeks and it doesn’t seem like a big deal – two weeks, three weeks, four weeks,” said Untuckit co-founder and CEO Aaron Sanandres. “But if you think of a season, it’s three months, so it’s a third of the season that you’ve effectively cut.”

Finding ways to move these off-season deliveries is a top priority for many brands. Large inventories of unsold clothing weigh heavily on business balance sheets, as these items will likely need to be marked down or destroyed. Shares of Abercrombie & Fitch plunged nearly 30% last month after the company said stocks were up 45% from a year ago.

Trending brands like shapewear brand Skims can count on their customers to buy just about anything, even if it’s a collection of fleece pajamas for fall 2020 that hasn’t began to arrive only the following April.

“Because we are a young company, we are more agile. So we could get through those more easily,” said Jens Grede, who co-founded the brand with Kim Kardashian. “But…it was really, really hard to get a fall/winter inventory because it was, you know, 70 degrees, 80 degrees in half the country.”

Others have to get creative to move untimely deliveries before they end up on the sales rack.

“Being late is disappointing because it wasn’t your original plan, but start from scratch,” said Sarah Engel, president of consultancy and digital agency January Digital. “What’s exciting about it to get your new customers or even your repeat customers excited? Focus on that.

Rebranding delays

Ideally, the customer will never know that an item is stocked months overdue.

Delayed inventory may qualify as “long overdue” or “back by popular demand,” if it’s a restock, Engel said. Regular customers may be offered off-season items that complement an outfit they recently purchased.

“Look for inventory adjacencies or complementary products,” she said. “Say ‘you liked item ‘X’, you’ll love item ‘Y’.”

Scarcity can also work to a brand’s advantage, although sometimes the reason is a backlog of container ships in the Pacific Ocean rather than a carefully planned limited edition.

When Untuckit only received 20 new styles instead of the 70 expected this spring, the company took a drip-style marketing approach, sending out emails to customers highlighting the inventory it had on hand. , then sent another message when the next ten styles arrived. .

“What it’s actually doing is focusing the buyer’s buying behavior on those 10 shirts,” Sanandres said. “There’s a silver lining, giving you more opportunities to connect with your customers.”

This strategy works best when a brand has a clear identity and a pre-existing connection with its customers.

“[Scarcity] …counts on the consumer to care,” said Katie Thomas, director of the Kearney Consumer Institute. “Just because you suddenly say it’s limited and fancy doesn’t mean you’re suddenly charging more or a consumer is going to be excited about it.”

Brands also need to take steps to avoid the inevitable disappointment when a customer goes looking for linen shirts and only finds fleeces.

Untuckit shirts that were stuck in Los Angeles were to appear in marketing emails, images on its website and in catalogs, some of which had already been sent to customers, Sanandres said.

The brand couldn’t do much about these catalogs, but it took steps to mitigate the potential fallout by creating a landing page to entice shoppers looking for the missing shirts to sign up to receive a notification. by e-mail upon arrival.

Sanandres said the brand had stored two months of “evergreen” marketing emails – the content of which could be sent at any time and still made sense – to help the brand pivot when plans get further derailed.

Smart Pricing

Ultimately, surrender may be unavoidable.

Many retailers cut markdowns during the pandemic, when factory closures, canceled orders and shipping delays kept inventory low. Now that clothes are piling up again in stores and warehouses, companies are cautiously reintroducing discounts, hoping limited sales will roll out of the season’s inventory without encouraging customers to expect permanent markdowns.

Macy’s executives, on the company’s first-quarter earnings call in May, said they have no plans to add more sales to the schedule beyond what is already expected, even as stocks of some pandemic favorites rise.

Macy’s CFO Adrian Mitchell said the retailer practices “dynamic pricing,” meaning it plans to change the timing, pace and size of markdowns based on factors like available inventory. and sales.

“We are just more surgical on the [promotions] that we do [have]said Jeff Gennette, president and CEO of Macy’s.

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