Lately, I’ve been following numerous “flash sales” website sales and promotions. The goal of a flash sale is to drive traffic to a website or store where a single product is offered for a deeply discounted price for a day or less, sometimes below a normal sales point. An article in the February 2011 issue of Wines and Vines lists six flash wine sales websites that “offered 318 wines at average discount ranging from 29%...to 53%” (http://tinyurl.com/65q7fpg). You can find numerous flash sales websites if you are looking for high-end fashion as well as daily deals on events and restaurant meals offered by sites such as Groupon.com.
One of the main benefits for the producer/retailer is the potential to eliminate overstock while reducing the risk that consumers will question the quality of the retailer and product – because of the low promotional price. By only offering the sale for one day it is believed that consumers will: 1) join a business’s email listserve, “like” them on Facebook, follow their Twitter feeds, etc., as these are common ways businesses alert consumers about flash sales; 2) buy items on impulse and focus on the great deal rather scrutinizing the brand/product quality because the item was so cheap; and 3) continue to be on the hunt for other “rare” deals the business offers.
Certainly, the majority of flash sales are promoted by bigger businesses and companies but it would be easy enough for a small or medium sized business to modify the idea. I can think of several garden centers who desire to sell their annuals before summer. The retailer could discount the plant material by 25%, followed by 50% and 75% towards the end of the season, but what if they do not all sell or just begin to look really bad? By promoting a flash sale a bit earlier than the normal discounting period retailers may find a greater number of these plants sell within a very short period of time. Benefits also include a reduced need to care for and water plants during the hot summer months and the potential for customers to purchase more than the flash sale item.
Again, the key is to “surprise” customers, keep the duration of the flash sales short, have stock on hand, and discount products that consumers would have an interest in purchasing. Don’t try to entice consumers to purchase stock that is destined for the compost pile or garbage – you just might lose their loyalty.