Despite Analytics, Programmatic Ad Serving, Out-Of-Stock Incidents Rise

Empty shelves at retailers and distribution facilities could find consumers who are searching online for a specific product out of luck on out-of-stock items.

Adobe data released Friday reveals that out-of-stock incidents were 600% higher than normal for electronics and 300% for toys on Thanksgiving Day.

Despite sophisticated analytics and emerging programmatic ad-serving platforms that tie inventory to oonline advertising, marketers still struggle to time ads and promotions with production and distribution.

Amazon Fire 7" 8GB, Beats Solo On-Ear Headphones in red and NBA 2K16 for the PlayStation 4, Pie Face Game, Doc McStuffins Get Better Checkup Center Playset, Bladebuilders Star Wars Episode 7 Jedi Master Lightsaber, The Force Awakens 6-Inch Figure are some of the top-selling items running low in stock on Thanksgiving Day, per Adobe.

Understanding inventory demands becomes just as important and identifying trends through analytics. Hannah Egan, IBM Commerce product and strategy manager, says the technology is available, but not really used by marketers and retailers.

She points to the Watson Trend app that predicts some Star Wars toys will sell out based on aggregated data from more than 10,000 sources, including search engines. Technology now shows marketers how quickly trends can spread.

"Some brands have tools that allow them to anticipate them," she says, but admits not all have analytics and listening capabilities. "You would think [out of stocks] still be happening, but demand for products change so quickly it's important for marketers to have something to predict them."

By the time Cyber Monday rolls in, some will blame out of stocks on returns and items being tied up in the loop.

A lot is at stake for retailers with consumers searching for products, ready to buy. On Black Friday, early data shows a 15% increase in spending compared with 2014, about $822 million spent online between midnight and 11 am ET, per Adobe data. 

Smartphones and tablets accounted for 37% of online sales Friday morning, with smartphone taking 22% of share; tablets, 15%. About $380 million in sales set a new record, per Adobe, which expects the day to generate $2.6 billion in total online sales, slightly lower than anticipated.

Out of stocks could force consumers to find another brand or retailer. It turns out that 53% of consumers feel annoyed by items, colors, and sizes being out of stock, according to a report published Nov. 23, from ThoughtWorks Retail.

ThoughtWorks survey ofmore than 500 U.S. consumers reveals women are significantly more likely than men to notice common retail complaints, but the biggest gender disparity points to customer service. Women were nearly 10 times more likely than men to cite poor customer service as the "worst part of holiday shopping," including out of stock inventory.

1 comment about "Despite Analytics, Programmatic Ad Serving, Out-Of-Stock Incidents Rise".
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  1. Henry Blaufox from Dragon360, November 30, 2015 at 1:08 p.m.

    It aapears from this article that the technology is outrunning the business behavior that is the basis for operations. Perhaps some managers don't uinderstand what the technology is telling them , or don't trust the information (that is not uncommon; the business users aren't sure whether to believe what the "computer guys" are telling them, so theyn don't authorize changes to ad campaigns or have a plan to replenish merchandise in a hurry.) Also, the stock was ordered and shipped long before the data anlytics pointed to inventory shortages. Now comes the age old problem, whether to restock with expedited shipment or not.

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