Preorder Power: The Surprising Benefits of Letting Customers Buy Soon-to-Launch Products
Opening a new online store can be an exciting yet daunting endeavor.
As you prepare your inventory, marketing, and operations, preorders can provide a valuable head start that benefits both you and your customers.
Offering preorders allows you to generate revenue, gauge demand, improve forecasting, build excitement, provide exclusives, gather feedback, reduce risk, and encourage loyalty right out the gate.
In this Substack, we'll explore the key advantages of making preorders available when launching an e-commerce business.
By taking preorders, you can hit the ground running and set your store up for success.
What Are Preorders?
A preorder lets customers reserve a product before its release by paying upfront.
It guarantees the customer will receive the item once it becomes available.
Preorders and backorders differ in a few key ways.
Preorders apply to unreleased products. Backorders allow orders for currently unavailable inventory.
- Preorders require full or partial upfront payment at the time of order, whereas backorders only charge once the product ships.
- Preorder inventory is allocated to customers in advance based on expected availability. Backorders are fulfilled on a first-come, first-served basis as stock comes in.
- Preorders lock in the price at the time of reservation. Backordered item pricing may fluctuate before fulfillment.
- Preorders involve reserving spots on a waiting list. Backorders queue customers without guaranteeing supply.
In summary, preorders provide reserved access to upcoming inventory.
Backorders queue orders based on uncertain availability.
The Benefits of Offering Preorders
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