Maximizing Preorder Sales: Tips and Strategies for Success
If you're starting a new business or launching a new product, generating sales is one of the biggest challenges you'll face. One effective strategy for generating sales before your product is even released is to offer preorders. In this blog post, we'll show you how to get preorder sales for your business.
What is a Preorder Sale?
A preorder sale is where customers can place orders for a product or service before it is officially released or available.
Reasons to Collect Preorder Sales for Your Business
There are several benefits to collecting preorder sales for your business:
- Measure customer interest: Preorder sales can help you determine if there is enough customer demand for your product to justify the time and expense of producing it. If you have a substantial number of preorders, it can indicate that your product is in demand and that there will be a market for it.
- Bootstrap your business: You can bootstrap your business with preorder sales by using the revenue to cover production, marketing, and other business expenses.
- Build buzz: Preorder sales can create buzz and excitement around your product before it is released. By allowing customers to preorder your product, you are giving them a sneak peek and allowing them to participate in the launch process. This can generate social media buzz and word-of-mouth marketing, increasing sales.
- Get early feedback: Once you have a list of preorders, you can ask customers for their feedback and opinions on your product. This can be valuable information that you can use to make improvements or adjustments before the official launch.
- Create leverage for other business deals: Preorder sales can give businesses leverage for other deals, such as raising funds from private investors or meeting the requirements for a manufacturing partner.
How to set up a Preorder Sales Campaign
Step 1: Prepare for your Preorder Sales Campaign
Before you accept preorder sales, you must prepare yourself and your business. Make sure to take care of the following items:
- Write a business plan: A well-crafted business plan will help you communicate your value proposition to potential customers. Here's a step-by-step guide to help you write the perfect business plan.
- Open a bank account for your business: Separate your personal and business finances by opening a business bank account. Here are the best business bank accounts and a guide on opening a business account.
- Consider setting a cap on your preorders: Consider how many preorder sales you are willing to take before accepting preorders. If you have a number, you will use this when you're marketing your preorder sales campaign. You are also welcome to avoid setting a cap and take as many preorders as possible.
- Create a website: Create a website (or landing page) that you'll use during the campaign to funnel traffic to where customers can complete the preorder sale. Here is a guide you can use to create your website. In the next step, I'll show you how to design your website for preorder sales.
Step 2: Craft your Website to Take Preorder Sales
You do not need a robust website to take preorder sales. A website built for preorder sales contains the elements you would see in a high-performing landing page with a few additions. Before we dive in, check out the following article:
Now that you are inspired to design your landing page, let's go through the elements.
Core elements of any good landing page:
- Clear and compelling headline: A headline that communicates the value proposition of the product or service.
- Persuasive sub-headline: A sub-headline that supports the headline and provides more context and information about the product or service.
- Eye-catching hero image or video: A visually appealing image or video showcasing the product or service.
- Clear and concise product or service description: A description that highlights the benefits of the product or service.
- Social proof: Testimonials, customer reviews, ratings, or badges that show the product or service has been used and appreciated by others.
- Call-to-action (CTA): A clear and visible CTA button encouraging visitors to take the desired action, such as "Preorder now."
- Trust indicators: Trust indicators such as a term of service or privacy policy page to make visitors comfortable that their personal information is safe.
- Relevant and engaging content: Content that aligns with the visitor's interests, such as videos, images, infographics, or bullet points.
- Mobile optimization: A mobile-optimized design that loads quickly and looks good on different devices, such as smartphones and tablets.
- Contact information: Provide clear and easy-to-find contact information for customer support so that customers can get in touch with any questions or concerns.
Additional elements for a preorder sales campaign:
- A compelling reason to preorder: You must offer a compelling reason to preorder, such as a perk or early-bird pricing, to ensure customers are motivated to place an order early.
- Payment link: You can set up a Stripe payment link in a couple of minutes that will allow you to collect payments. On the product description for the link, you can say "Preorder for…" to ensure there is no confusion with the customer and to easily distinguish your preorders from regular orders.
- Expected delivery date: Clearly state the expected delivery date for the product, so customers know when they can expect to receive it. Be as specific as possible and provide updates if the delivery date changes.
- Refund policy: Make sure customers understand the refund policy for preorders. Be clear about what happens if the product is delayed or the customer changes their mind before receiving it.
Step 3: Shout from the Rooftops
Once you're happy with your website, you can take preorders. Now your job is to create buzz and excitement and spread the word about your preorder campaign. It's important to remember that depending on your product and business, pick marketing channels based on where you think you can reach your target audience. You want high-intent traffic that is likely to convert to a preorder sale. Here are some marketing channels and ways you can promote your preorder sale campaign for free:
- Tap into your personal network: Ask friends, family, former colleagues, and acquaintances to support your launch. If they don't want to preorder themselves, they can provide you valuable feedback which you can use to change your strategy or get them involved in other ways such as sharing to their broader networks.
- Send personalized email: You could send personalized emails to potential customers using a free emails finder tool like Hunter and a Gmail account.
- Run Reddit ads: Running ads usually costs money, but Reddit runs a free $100 ad credit campaign.
- Shoot your shot with existing customers: If you are fortunate to have customers for other products or services, you could share your preorder sale campaign with your existing customers.
- Create captivating content: You could post content to a blog surrounding the product or service for the preorder campaign to rank on search engines to get visitors to your website.
- Drive momentum on social media: Share your preorder campaign on your social media accounts and post updates about the campaign's momentum as the weeks' progress.
Step 4: Share Updates and Deliver on your Preorders
Once you've launched your preorder campaign and started generating sales, keeping your customers engaged and informed throughout the process is important. Here are some tips for sharing updates and delivering on your preorders:
- Provide regular updates: Keep your customers in the loop by providing regular updates on the progress of your product or service. This can include information on production timelines, shipping schedules, and any unexpected delays or challenges. Consider using email marketing or social media to share these updates with your customers.
- Be transparent: If you encounter any issues or setbacks during the production or delivery process, be upfront and transparent with your customers. This can help build trust and credibility with your audience, even if it means delaying delivery or refunding preorders.
- Deliver on your promises: Make sure you can deliver on your promises to your customers during the preorder campaign. This includes delivering the product or service on time and providing promised perks or bonus features.
- Provide exceptional customer service: Preorder customers are likely to be your most enthusiastic supporters, so make sure you're providing excellent customer service throughout the process. This can include answering questions promptly, offering personalized support, and following up after delivery to ensure customer satisfaction.
Tips to Increase Your Preorder Sales
- Leverage influencers: Consider partnering with influencers in your niche to promote your preorder campaign to their audiences.
- Create scarcity: Set a limited number of preorders available or offer a limited-time discount to create a sense of urgency and encourage customers to act quickly.
Common Mistakes With Preorder Sales Campaigns
- Spending preorder sales revenue on other business expenses: Many businesses fail to budget properly and spend too much of the revenue from preorder sales on other business expenses, leaving no money to fulfill the production of the preorder products.
- Not setting a realistic delivery date: If you select an unrealistic delivery date for your product, customers may become frustrated and cancel their preorders. So, set a realistic delivery date and communicate any delays or changes to customers as soon as possible.
- Not having a clear shipping strategy: If you do not have a clear shipping strategy, you may encounter delays or issues with delivery. Ensure you have a clear shipping strategy and communicate it to customers upfront.
Examples of Successful Preorder Sales Campaigns
Tesla Model 3
Tesla is known for using preorders to launch new models of their electric vehicles. In 2017, they received over 450,000 preorders for their Model 3, which helped generate considerable buzz and allowed them to gauge demand for the new car.
Apple iPhone 12
Apple has used preorders for many product launches, including the iPhone and iPad. They typically offer preorders a week or two before the official launch date, which helps build excitement and generate early sales. For example, Apple sold over 2 million iPhone 12 models within 24 hours of preorders.
Peloton
Peloton, a fitness company that sells high-end exercise equipment and subscription-based workout classes, used preorders to launch their original bike in 2013. They used a Kickstarter campaign to raise over $300,000 in preorders and generate buzz for their new product.
Conclusion
Preorders are a valuable tool for businesses to generate sales and validate demand. To maximize preorder sales, businesses should create a compelling product, establish a solid marketing strategy, and leverage various channels to reach potential customers. With a strategic approach and focus on fulfilling preorder commitments, businesses can leverage preorders to drive long-term success and growth.
FAQ
What are the benefits of hosting a preorder campaign on my website instead of Kickstarter or Indiegogo?
First, it's cheaper since Kickstarter and Indiegogo charge fees based on the total funds raised and payment processing fees. Second, when you host your campaign on your website, you have complete control over your campaign's content, design, and messaging. You can tailor it to your specific audience and brand, which can be especially important if you have an established customer base. Third, Kickstarter and Indiegogo only work well for some businesses. For example, a preorder campaign for a service would not generate buzz on these platforms. Lastly, Kickstarter and Indiegogo are all-or-nothing campaigns, meaning you only receive the money if you pass a certain threshold. When you host your preorder campaign on your website, even if you get only one preorder, you get to keep that money and turn your idea into a reality.
How long should I run my preorder campaign?
A good rule of thumb is to aim for a campaign length that allows enough time to generate buzz and excitement without leaving potential customers waiting too long for the product.
How can I incentivize customers to preorder?
You can offer perks in the form of exclusive content, early access to the product, discounts, or freebies. When deciding what incentives to offer, you must consider your target audience's values and what would be most appealing to them. In addition, it's essential to ensure that any bonuses or incentives offered are feasible and won't negatively impact your ability to deliver the product on time.
Can preorder sales be used to cover production costs and other business expenses?
Yes, but it's important for businesses to carefully manage their cash flow and expenses to ensure that they can fulfill their preorder commitments on time and deliver a quality product to their customers.
