Strategy

More Transparency, Marketing Shifts Can Ease Supply Chain Strain

supply chain logistics

The supply chain issues incepted in late 2021 have continued into the new year. Most companies still face issues of product availability and delayed shipping, along with the potential of over and understocking shelves.

That said, not all companies face the same supply chain issues — or even any issues at all, so not communicating supply chain status to consumers can prove detrimental.

Regardless of supply chain status, it is important for businesses to ensure their consumers know when to expect their products to be available, or they risk losing loyal customers.

This can be accomplished in many ways, such as weekly product email updates, a robust delivery information system, or a quarterly executive announcement on supply chain status.

Overall, it’s essential to streamline marketing communications so customers know when the products they need are available.

Smart Marketing

Supply chain issues will continue well into 2022. Whether it takes months longer than anticipated to purchase a car or several different grocery trips to find all the items you need, we’ve all experienced the effects of this crisis one way or another.

Some industries, like marketing and advertising, have been hit harder than most as many companies cut back on ad spending to offset lost revenue caused by supply chain snarls. But these bottlenecks do not need to result in cutting ad spend completely. There are smart ways to adjust.

One alternative that many businesses do not consider is shifting their advertising and marketing focus toward stock that is available instead of items that are not, suggested Link Walls, vice president of digital marketing strategy at ChannelAdvisor.

“When companies go through rough financial periods, their knee-jerk reaction is to cut advertising and marketing budgets first,” Walls told The E-Commerce Times.

“In the case of supply chain bottlenecks,” he continued, “companies do not want to advertise or market products that consumers cannot get their hands on immediately or even for the foreseeable future.

By shifting gears and pushing available products, ad budgets can be spent more wisely without companies taking a loss, Walls noted.

Make Stock Adjustments Count

Consumer demand is at an all-time high, so supply chain issues do not bode well for brands and retailers. But they need to be strategic about their inventory and what they do have to offer.

“They also need to be agile with consumer demand and roll with whatever the consumer is doing to meet them where they are,” Walls explained.

Another approach for doing this is to build a dynamic digital advertising program that is flexible as inventory changes. Many companies see fluctuations in inventory caused by supply chain issues. Often it is quite variable.

Only certain categories are heavily impacted. In many cases, they are just specific SKUs.

By integrating their inventory directly with their digital advertising campaigns, companies can quickly shift spending on the fly. This lets them move ad dollars to those products that are in stock and ready to ship.

As stock comes back in, the system can automatically revert to pushing those products. This approach with dynamic systems ensures that ad dollars are used in the most efficient manner, Walls explained.

Rethink Info Sent to Stakeholders

One of the biggest takeaways from the past few years is predicting the ups and downs of supply chains. That is nearly impossible, suggested Thomas Kasemir, chief product officer at Productsup.

“Outside forces that can cause disruption will always exist. But as companies work to become more agile to better manage unexpected changes, they also need to rethink how they are communicating supply chain information to their stakeholders,” he told the E-Commerce Times.

Customer loyalty is in a fragile state due to commerce anarchy. It is time for supply chains to become more transparent.

Unexpected Struggle

The supply chain was built to be a very efficient, well-oiled system over the last 30 years. In two quick years, it has experienced massive disruptions that have run it off course, observed Walls.

“The truth is that it will take a while for things to get back on track, even well into 2022,” he offered.

All companies do not face the same supply chain issues, or any predicaments whatsoever. Like many aspects of the pandemic, the effects are not universally distributed.

For instance, some companies have invested heavily in building their own supply chain which has been more immune to things like price increases on container shipping. Others may be able to source more materials domestically, avoiding some of the issues at the ports, said Walls.

Fleeting Transparency

Some businesses struggle with an inability to provide transparency in supply chains because they rely on dozens of different systems that fail to work cohesively together, according to Kasemir. On average, companies use four different systems just to manage their product information.

“As a result, 83 percent of U.S. decision-makers are concerned with the consistency of product information being passed through their tech stack,” he said.

Sometimes, misinformation among consumers sparks imaginary supply chain issues. For example, leading up to Thanksgiving last year, consumers were concerned about a non-existent pumpkin filling shortage.

“Failing to provide shoppers with up-to-date, consistent product information can have a significantly negative impact on sales and consumer trust,” said Kasemir.

Managing product data across supply chains is extremely difficult in today’s complex commerce ecosystem. Companies source product data from thousands of different suppliers. Then, they must reformat the data to meet requirements for various marketing and selling channels.

“With hundreds of thousands of consumer touchpoints spread out across online marketplaces, social media platforms, DTC sites, physical stores, and more, ensuring product data is accurate in every location is nearly impossible,” he added.

Managing Value Chains

Communicating supply chain information to consumers comes down to how well a company can manage its product information value chains. These are the pathways in which product information flows across supply chains as it moves from suppliers to retailers to shopping channels to buyers. It eventually loops back to suppliers in the form of feedback or returns, said Kasemir.

That should be done with a product-to-consumer management strategy, where companies use a centralized view and streamline the flow of product information.

The key features of this approach include large-scale sourcing of product information from an infinite number of sources, real-time product data syndication to many marketing and selling channels, and continuous monitoring and updating of all data touchpoints.

Jack M. Germain

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

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