Merchandising is emerging as a key revenue stream for influencers of all types, ranging from Mr. Beast to Skims brand. Yet, how do you drive demand for merchandise, or “merch,” when everyone everywhere is trying to get a small piece of anything from all of your fan base? Can you create an exclusive FOMO (fear of missing out) atmosphere when everyone is afraid to miss out on the next big thing? Try these ideas:
Believe the Merch Hype
Hype has definitely been helpful to driving many brands, influencers, and artists to sell out. By keeping items in limited quantities with specific drop dates, you are creating an artificial market for your products. No one is ever camping out in front of the Gap, for example, to get the latest khaki colored shirts. Part of this comes from the new resale market which includes old players like eBay and newer entrants like StockX, The Real Real, and Poshmark.
The hype is real though, with high end luxury participants like Sothebys’ and Christies entering into the luxury, fashion, and street wear market. Because of this, many limited items end up selling for double to triple what you paid for it as soon as you walk out the door (or for presales, see next section, as soon as you get the confirmation email!)
With small batch creation, it’s always challenging to know how much of something to create. Create too little and you have disappointed customers (or not, keep reading!), create too much and you’re stuck with inventory that you’ll eventually have to mark down which could possibly cheapen your brand (high end luxury simply burns this inventory, literally, but you can’t afford to do that, can you?) Additionally, if you are to reach minimum order quantities most likely you may have to outlay cash upfront. Depending on your situation and confidence to move your products you might not have this money!
Enter the presale. Pre-sales are pretty transparent in letting consumers know that it will be more than the standard 3-5 day shipping (c’mon most influencers aren’t using Amazon Prime to fulfill!) and sometimes could be as long as 3-6 months before their products get there. In extreme cases like Kickstarter projects, you are also acknowledging the risk that maybe the product never gets made and you will lose the cost of your “donation.” For most influencer products though, the products are straightforward like apparel, electronics, art, or other things that are already made and proven and just need branding on them.
Be Location Specific
Over the weekend, the author (me!) was fortunate enough to land tickets to the BTS pop up in Soho, New York. What the folks running the booth told me was that this limited time pop up was a pre-sale opportunity only for this location (wow, they are following this guide to a T!). The merchandise available in the New York location is different from the merchandise available in the Los Angeles location. While this is another tactic to drive hype as well as supply and demand, it is also a testament to their media strategy and that many large influencers can make it to either LA or NY (or other major Tier 1 city).
Furthermore, long lines beget long lines. While the BTS pop up did not have a long line (they even let us in an hour earlier than our timed ticket), the fact that you needed a ticket to buy something leads to additional hype. Finally, this leads to a reality check that products are actually being sold as opposed to fake online hype sales.
Basic Supply and Demand
To feed into the hype, urgency, and flip value, we need to go back to economics 101, where we learned that prices go up if demand exceeds supply. To take this concept to sell out levels, figure out how many people might buy your product, multiply that by a percentage less than 100 and that’s the size of your limited edition drop. (i.e. 1000 people want your product, you want 40% of them to be happy, so you create 400 whereby 600 people miss out and due to FOMO will not miss the next drop!)
While there might be resellers that sell your product for double or triple on eBay, you can be sure that this is good for your market. The people that missed out on the drop will be ready for the next product you drop. And you’ll then start building a loyal fanbase for your merchandise.
Are you looking for ways to drive more merchandise sales? What strategies do you use that you would be willing to share with our community? Drop us a line and let us know!