British retailers risk alienating customers and losing out on profits by squandering their ad budgets low stock items, according to product performance management (PPM) platform ROI Hunter
Although just over two-thirds (67%) of businesses say that they have full control over their ad spend on individual items, close to four in ten (39%) believe that their budgets have been spent less effectively than last year.
Surprisingly, even though around eight in ten marketers in the retail sector consider profitability as one of their top KPIs, as it stands less than a third (32%) currently report on it.
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“The cost-of-living crisis has driven consumers to be selective in how and where they spend their disposable income. Displaying ads for unavailable items will only misplace the budget and encourage loyal customers to shop elsewhere,” ROI Hunter CEO, Karel Schindler said.
“Businesses must take control of their marketing budgets to drive profitability. By setting up a filter to automatically pause promotion of products when they have less than a set percentage of variants in stock, retailers can instead focus their budgets on in-demand items with high availability. This is the type of optimisation that can be achieved through product performance management.”
The failure of retail marketers shift their budgets away from low availability items, may lead to further cash flow issues – this is despite 77% of marketers expecting their budgets to increase over the next year.
