Fewer SKUs: Key To Scaling DTC

Most DTC brands are carrying too many SKUs.

Mostly dead weights.

Most brands, including our clients, can remove 40-50% of their product range without any substantial loss (max 10% or less).

A few obvious benefits are –

  • High margins (due to increased purchasing power)
  • Better inventory management (due to lower counts)
  • Low operational challenges

But from a marketing perspective, it leads to –

Higher conversion rates.

Remember the famous Jam case study. More options lead to action paralysis.

With a few products, you can provide a detailed product page and shopping experience (like Apple).

Also, it saves you from wasting advertising dollars on low converting product range.

Higher customer loyalty

Low SKUs enable a better connection for the customer as well. They expect and get a more consistent experience.

Due to a higher focus on product quality, they associate the brand with specific, high-quality offerings.

Brands agree to the benefits of carrying a small range but still take too long to pull the trigger.

The most common argument I hear is around cross-selling, and repeat purchases.

More products lead to more options for brands to promote.

I agree.

But you don’t need to launch new product lines that just sit there. You can always do that with –

  • Launching limited editions
  • Exclusive drop
  • Variations of color or flavor.

Launching and removing product lines creates a different buzz than carrying non-performing items.

Product portfolio optimization is crucial to profitable growth.

Optimizing your product lineup every quarter can help you reduce your costs, and improve margins, conversion rates, and retention rates.

Found this ARTICLE HELPFUL?

Subscribe to weekly newsletter to grow your store profitably.

Leave a Reply

Your email address will not be published. Required fields are marked *

RELATED ARTICLES

GET YOUR FREE REPORT NOW BEFORE THIS PAGE COMES DOWN

This Free Report reveals actionable advice & 8 secret hacks to get 37% Higher AOV

GET YOUR FREE REPORT NOW BEFORE THIS PAGE COMES DOWN

This Free Report reveals actionable advice & exact tactics to triple your customer retention

GET YOUR FREE REPORT NOW BEFORE THIS PAGE COMES DOWN

This Free Report Reveals Actionable Advice & Strategies To Get 760% More Email Revenue With Better Segmentation​

GET YOUR FREE REPORT NOW BEFORE THIS PAGE COMES DOWN

This Free Report reveals actionable advice & battle-tested SMS marketing strategies that have generated $1M+ in revenue.

GET YOUR FREE REPORT NOW BEFORE THIS PAGE COMES DOWN

This Free Report reveals actionable advice & exact battle-tested automation strategies that have generated $11M+ in revenue