How to use back-in-stock alerts

For retail merchants, e-commerce businesses, direct-to-consumer brands, wholesalers, and manufacturers, stockouts can be an unavoidable reality of an unpredictable and rapidly shifting marketplace. But when stockouts occur, and you don’t have the inventory available to fulfill a potential sale, it can mean lost revenue, unhappy customers, a decrease in brand loyalty, and wasted marketing efforts.

However, there are a few things you can do to help minimize stockouts and their negative effects, including changing how you order inventory, increasing safety stock levels, or offering backorders. Another solution, which we’ll be examining today, is implementing back-in-stock alerts.

What is a back-in-stock alert?

A back-in-stock alert is a way for businesses to stay in touch with customers in the event of a stockout. Its primary purpose is to get them to return and complete the purchase once the item’s inventory has been replenished. Back-in-stock alerts typically take the form of emails or SMS notifications.

For example, if one of your customers ends up on a sold out product page on your e-commerce website, you might provide the option for them to enter their email or phone number with the promise to notify them when the product is back in stock. Companies can also use cookies or browsing data to send specific notifications or targeted ads about the product to the customer.

Once the item is back in your inventory, you can send an automated email or text informing customers that it is once again available and encouraging them to return to the store to purchase it. 

Benefits of back-in-stock alerts

There are a variety of benefits that back-in-stock alerts provide your business:

  • Recovered revenue. Primarily, back-in-stock notifications are meant to recover the revenue and marketing costs that are lost when a customer is unable to purchase a product. By alerting potential customers that an item has been replenished, you increase the chance of converting a percentage of lost sales.
  • Sustained interest. Back-in-stock alerts can help you sustain customer interest in a purchase. By letting them know that the item will be back-in-stock soon and they will be notified personally when it is, you can encourage customers to wait for the restock rather than go to a competitor.
  • Demand insights. Back-in-stock alerts can provide insights regarding the customer demand for a particular item. A waiting list for a product can also signal to customers that it is popular and, therefore, worth waiting for.
  • Increased subscriptions. Lastly, back-in-stock alerts can help grow your customer subscription lists for future promotions, newsletters, email campaigns, and other outreach.

How to set up back-in-stock alerts

In order to send back-in-stock alerts to your prospective customers, you must first set up tools on your selling platform to collect customer contact information. These tools vary depending on what platform you use. Here’s how you set up back-in-stock notifications on the most popular platforms, including Shopify, Amazon Sellers, and WooCommerce:

  • Shopify. Brands that use Shopify to sell their goods can utilize the Back-in-stock app to send back-in-stock notifications. The app is easy to set up and configure, collects customer information on sold out product pages, and automatically sends back-in-stock alerts when a product is replenished.
  • Amazon Sellers. Amazon offers a free back-in-stock tool that will issue notifications when an item is back in your inventory. You can also set up backordering for products that are out of stock to be shipped on their restock date.
  • WooCommerce. WooCommerce offers an add-on that will send back-in-stock notifications once purchased. The feature prompts customers to enter their email information on any out-of-stock page and automatically notifies them when the item is back in stock.

Most back-in-stock alerts follow a simple formula. They should be clear, concise, and feature a direct call to action. You can also add incentives that encourage customers to buy the product immediately and can alleviate any frustration they may feel at having to wait to make their purchase, such as free shipping or other discounts or promotions.

How effective are back-in-stock notifications?

While back-in-stock alerts provide a way for retail and e-commerce businesses to recuperate lost revenue from missed sales, they are not tremendously effective. Only a small percentage of retail customers return to make a purchase after receiving a back-in-stock alert, and many will prefer to shop elsewhere to find the item they want. Recouping a small portion of that potential revenue is better than nothing, but it is not always the most efficient option.

Back-in-stock alerts vs. backorders 

If possible, placing items on backorder is typically a better way to deal with items that are out of stock. Backordering allows you to complete the transaction, guaranteeing your business the revenue from the sale and keeping cash flowing through your company that can be used in other areas of the business. The bottom line is that backorders are completed sales awaiting fulfillment, while back-in-stock alerts rely on customers that may not return.  

Avoiding stockouts in the first place with Inventory Planner

Ideally, your business shouldn’t have to deal with back-in-stock alerts or backorders at all, or at least infrequently. The best way to reduce stockouts and avoid having to implement back-in-stock alerts is to improve your inventory planning strategy. The most effective way to do that? Use a dedicated inventory planning software like Inventory Planner.

Stockouts can occur at any time for a number of reasons, as maintaining optimal inventory levels across a large number of SKUs, multiple inventory locations, brick and mortar stores, and online sales channels can be difficult in a rapidly changing market like retail and e-commerce.

In addition, customer demand fluctuations due to marketing campaigns and high seasonality can also trigger stockouts, which can reduce revenue and turn away hard-earned new customers just when you want to capitalize on sales the most.

Inventory Planner allows you to stay on top of stock levels by knowing exactly what to buy, how much inventory is needed, and when to order based on up-to-date customer demand predictions.   

Even when customer demand changes abruptly or supply chains are disrupted, Inventory Planner takes all relevant data into account and continues to update recommendations accurately in real-time. It also allows you to align your inventory purchasing with upcoming marketing campaigns to ensure you have the right inventory to meet higher customer demand.

With over 200 metrics and insights available and reliable purchasing suggestions across all SKUs, product types, brands, warehouses, and suppliers, you can feel confident that your inventory levels will remain optimal and meet demand without becoming a financial burden. So, instead of relying on the minimal return percentage you get from back-in-stock alerts, ensure you’re not leaving revenue on the table by improving your inventory planning practices with Inventory Planner.

Improve your back-in-stock process and even avoid it completely

See how Inventory Planner can change your forecasting & planning

Get my demo