A Lesson in Supply and Demand
Who wasn’t appalled when they found out that the H&M on 34th st, NYC was throwing away distressed inventory? The go to answer is for H&M to donate excess merchandise to charity – and it should be – but digital can prevent retail giants from reaching that point all together.
All eyes should be on Threadless. Threadless aims to keep their inventory level at zero. Each week artists submit designs in which the online community scores them from 0-5 and decides whether they’d purchase this design for a t-shirt or poster. The most popular weekly designer receives $2,000 and is invited to the HQ to be a part of the manufacturing process. Based on the voting process, Threadless then determines how many t-shirts and posters to produce.
Retailers need to harness the same supply and demand insights from their communities. Clearly, it’s much more difficult for a company that sells more than t-shirts and posters. It is doable. H&M could publish their spring line on their .com and elicit the community’s feedback to prevent the 34th st debacle. Did one product perform consistently below average? Kill it. Did a blouse resonate more with people from Illinois than New York? Let’s amend our local distribution plans. Retailers simply do not realize the amount of insights they can gain in advance from digital communities.
Please feel free to share other companies or sites that are following Threadless’ footsteps!