Ecommerce Pre Order Strategy: The Right Way To Build Hype and Validate a Product

What Is A Pre-Order?

A pre-order is an order placed for an item that is not yet commercially launched or available.

Offering pre-orders means you let customers reserve things in advance.

It is a product validation process that allows businesses to reduce risk. Also, to create hype around your products.

Having pre-order customers pay money for your idea before it's ready is the best motivation you can get.

But as they say, different strokes for different folks.

Things will work differently for a startup offering pre-orders than an established brand.

For example, sometimes, brands use this strategy to test the demand for their next launch. 

So, you know it's not always about having instant sales. You can use this strategy to test the waters if you're planning to launch something big and unusual.

If your products are exclusive, customers will buy them before they land on the market. 

But... you need to have an excellent pre-order campaign.

Let's take Sony's PlayStation 5 as an example.

This tech product was available for pre-order way before the actual launch and availability date itself.

Pre-orders work. And this strategy is helpful for both the seller and the customers.

Why?

Because the business can secure the demand and cash flow. While the pre-order customers, especially loyal fans, can assure that they'll have their hands on the newest product.

And it's not just branded products that are available for a pre-sell.

Many small-scale brands also ask customers to pre-order stuff.

Blowout cards can be a good example.

They ask customers to reserve their hottest products before they're released.

But like anything else, pre-orders won't work for everyone.

Let's start listing some reasons to see if this strategy has potential for your business.

When Would You Offer Preorders?

The amount of investment that goes into running a physical store is enormous.

You invest your days and nights developing a product that may or may not sell in the market.

I know you did your market research.

But you still need to ensure that the product you'll launch will have enough demand.

Because the production process of a product is no joke.

Speaking of the production process...

Mostly, there are independent suppliers involved. That means you need to confirm the materials' availability before committing anything further.

Those vendors ship parts to your assembly partner.

And from there, you can pick, pack, and deliver products to your customers.

The entire process isn't just strenuous but time-consuming too.

Now, imagine creating a product that customers are not willing to buy. The entire idea of running a business goes into the trash.

After all, there is no business without customers.

Offering pre-orders before launching a product is an excellent way to validate your idea.

Here's when you would offer pre-orders…

1. Your Goal Is To Build Hype

Do you want to create a buzz around your collection? Offer pre-orders. 

You can also take it a step further and announce a limited pre-order supply for your buyers. 

For example, you can offer 30 pre-order spots (on a first-come, first-served basis). 

The fear of missing out will encourage your customers to pre-book their orders right away. 

This is also good for your brand because your target audience will think that your products are always in-demand.

The pre-ordering strategy may also do wonders for you if...

2. Your Goal Is To 'PLEASE' Your Buyers With An Unlimited Quantity Of High-Demand Products

Is there a product or collection you launched previously with high demand? Something you launched with a limited quantity earlier? If you answered yes, I have good news for you.

Out-of-stock items don't have to be unavailable forever!

You can use pre-orders to please your customers with an unlimited supply of your high-demand products.

Since some of them might have abandoned carts already because of the unavailability of some products...

Don't forget to use Debutify's Back in Stock add-on to notify your customers that their favorite out-of-stock items are back!

You can also nurture loyalty with your pre-order strategy. Here's how...

3. Your Goal Is To Grant Early Access To Your VIP Customers'

Keeping your VIP customers happy can be the best thing you can do for your business.

These are customers that always make regular purchases on your eCommerce store.

They will contribute to your conversion funnel and recommend your brand to others.

Luckily, your pre-order strategy can help you with this too.

All you need to do is grant pre-order access to your loyal customers.

It is the same as asking your VIP buyers to go behind the rope while others stand in a queue.

Who doesn't like VIP treatment? We all do.

You can reach them through a targeted email and tell your loyal customers how special they are. 

While most businesses can benefit from pre-orders, they are not for you if:

Your suppliers are not reliable. Because sometimes, you might face issues receiving things from them on time. That's not good for your brand image.

You work on retail platforms like Amazon or eBay. Why? Because these platforms support quick delivery. You may lose your account in case of late deliveries and negative feedback.

So yes, like anything else, pre-orders also have their limitations. 

Using this tactic, it would be better to have a clear idea of what you can or cannot achieve. Doing so will help you manage expectations. 

Also, it would be easier for you to plan better and be proactive as a business owner.

Now, I'd like to discuss the pros and cons of pre-orders in the following section.

This will give you a better idea of what you should or shouldn't expect using this strategy.

Pros And Cons Of Offering Pre-Ordered Products

Let's start with the benefits first...

Pros Of Pre-Orders

1. Guaranteed Sales And Revenue

You don't need to wait for the actual launch to have customers because you already have your pre-order customers.

Pre-orders result in guaranteed sales for your ecommerce business. And guaranteed sales mean guaranteed revenue.

2. You Can Determine The Demand For Your Products

With pre-orders, you can also determine the future demand for your products. 

It is easy to predict that customers want your products if all pre-order spots fill in no time.  

3. You Can Build Hype And Validate Product

You can create a buzz around your collection with a winning pre-order strategy.

Allowing customers to pre-book limited slots will make them feel they're buying something valuable.

Others will feel that they should join the clan ASAP. Who wants to miss out on an amazing product, right?

You can also see if your future products will have a high demand.

4. You Don't Have To Worry About Unsold Inventory

Selling physical goods before they even arrive will remove the risk of unsold inventory. Startups will benefit greatly from this.

A few perils…

Cons Of Pre-Orders

1. The Risk Factor Is Always There

Pre-orders guarantee sales of a few specific items. Probably the one with the most demand.

That means you can't build your complete marketing and business strategy around it.

Another con of selling pre-orders is...

2. You're Dependent On Your Supplier

The success of your whole ecommerce pre-order re-order strategy depends on the efficiency of your supplier. Again, if your supplier fails, it can have a negative effect on your brand reputation.

So, if you're unsure about them or their performance, this strategy can cause more harm than good.

3. Using It On Retail Platforms Is Out Of The Question

As I mentioned above, customers who buy from Amazon or eBay expect fast deliveries. You can't ask them to pay for something and wait to use one of those platforms. 

I hope you have a clear idea of what you can or cannot expect from a pre-order strategy at this point.

Let's dig deeper and explore some practical aspects...

How To Do Pre-Order Business? (Choosing Your Pre-Order Method)

There are different ways in which pre-orders work.

Here are the 3 most common types of pre-orders you can offer:

1. Pay Now

This is the simplest of all. Your customers will pay you upfront for the pre-order products. The only trouble is that a customer's regular purchases sometimes get mixed up with their pre-orders.

This may result in complicated delivery costs and communication issues with your pre-order customers.

2. Pay Later

You can also send your customers payment links to pay later. They can complete their checkout process through your online store.

Again, sometimes customers change their minds. If that happens, you might not be able to collect all requested payments if they choose to pay later. This might also affect your business's cash flow.

3. Crowdfunding

Accepting the pre-orders through a campaign page involves extended delivery times, like 6 to 8 months.

The only downside of this option is that you might target early adopters, not your ideal customers. You don't want that.

Remember...

You Need A Strategy If You Want To Get The Most Of Your Pre-Orders...

Today's business owners need to learn one thing. They can't automate every task to drive growth.

Whether it's social media and content marketing, or pre-orders, you will need a successful pre-order campaign strategy to move forward. You need an effective pre-order campaign.

Wondering how you can build an effective pre-order strategy for your business? Head over to the next section to find out...

Building An Effective E-commerce Pre-Order Strategy

1. Only Promote New Products For Pre-Orders

Do you have a new product launch in the pipeline?

Launch it through pre-orders. Sure, you can also use pre-orders to announce back-in-stock alerts. But this tactic usually works when the demand for your products is too high.

But still, this is a great pre-order campaign.

Because online visitors like to be the first to buy a new item. So, unveil all your new or upcoming products via pre-orders.

You should also...

2. Advertise Your Pre-Order Campaigns On Social Media

Want Shopify's order management system or any of your pre-order apps fill with a lot of pre-orders? You need to promote on social media.

Social media marketing is probably the easiest way to promote your products and encourage pre-orders.

Social media can be the best place for promoting your pre-order campaigns. Retarget those who visited your pre-order page but bought nothing.

You can also create and publish a video showcasing your campaign highlights. Or take advantage of paid social media strategies.

Don't forget to...

3. Add Urgency To A Purchase By Offering Incentives

Want them to click on your pre-order button ASAP?

Throw in a limited-time discount offer on pre-orders. This will push your customers and encourage them to take timely action. 

You can also urge them to join the first batch of pre-order customers. This way, they'll feel more tempted to join your pre-sell list.

The very essence of using a pre-order strategy is to generate excitement and build hype. For this, you have to...

4. Spread The Word

The more you spread the word, the better your current customers will respond to your campaign.

Send out an email to every customer on your list. You can also create diverting copy and visual assets to attract your target audience.

No one will be enticed to click that "Buy Button" if your pre-order campaign materials don't look attractive.

Also, add T&Cs, the total quantity of products available for pre-orders, and other details.