June 11, 2021
By: Peter Gregory
Looking for a way to convert new fans to your brand and make more money at the same time? A limited edition sales strategy could be just what you need! Limited editions can be very effective for clothing startups, but they have to be tackled in the right way. It takes months of planning, careful market research and hard work to get right.
This week, we’ll explain why even the smallest bootstrapped fashion brand should have a plan for selling limited editions online. We’ll show you what a drop strategy can do for your business and what the limitations are. We’ll also share some practical tips on how to get your own product drops up and running.
When we hear ‘limited edition’, most of us think of something that is precious, special and scarce. This perception of rarity is what underpins its success as a selling strategy.
The phrase ‘limited edition’ has been around since Victorian times. While the phrase is still well-known today, the industry term you’re more likely to hear nowadays is ‘drop’, or ‘product drop’. Product drops are lightning-fast flash sales of one specific limited-edition product, usually conducted online and promoted over social media. The goal of a ‘drop’ is to create a perception of exclusivity and immediacy around a garment. In essence, you’re compelling fans to ‘buy it quick’ and ‘buy it now’.
Product drops are getting more and more popular, especially for cult ‘collector’ brands.
It’s by no means an easy task to run a profitable, sell-out limited edition campaign. You need to time your drop carefully, pick the right product and promote the whole campaign effectively. Here are our best-practice tips for successful product drops…
One clothing brand that has built its entire business model around the limited edition concept is Supreme Clothing. This exclusive skater fashion business has a very limited number of retail stores in major cities like London and New York. They release mini-collections of stock, on a very limited run, and allow the stock to completely sell out. Once their stock sells out, they simply close the doors on the shop and walk away until the next product drop.
Supreme has taken this business model online in recent years. Every Thursday at 11AM, a brand new mini-collection goes on sale on their website. They often sell out in a matter of hours. It’s worth following their Instagram profile, just to get a sense of how they run these drops so successfully:
It’s not all good news. Limited Editions are a powerful selling tool, but there are problems that you need to be aware of up-front.
First off, limited-edition dropping is not a very efficient way to run your business. Most of us expect to design a garment and then sell as many copies of that garment as we can. The plan is always to keep selling until you’ve ‘used up’ your buyer demand for that item. With Limited Editions, however, you’re always going to be leaving a lot of untapped consumer demand on the table.
Another common issue is how much money you make per-item, compared to what those items are eventually worth on the ‘open market’. It’s not uncommon for a well-known Limited Edition brand like Supreme Clothing to sell a garment at £100 and find it reselling online, hours later, for £600 or more. If the thought of ‘missing out’ on extra income like this turns your stomach, then maybe limited editions aren’t for you!
Second, a limited edition isn’t going to magically transform your brand into something it’s not. You’re selling to an established fan base: people who already like what you do and what your brand is about. You need to cater to this fan base, regardless of your own personal ambitions as a designer. For instance, you might have a reputation for delivering durable, good-value workwear for men. A limited-edition toolbox or baseball cap might work well for you here … just don’t expect to ship 100 limited-edition luxury ball gowns to the same audience.
Third, limited editions only ‘look good’ when they sell out. Part of the implied contract you make with your fans with a product drop is that the garments you’re selling are truly rare. If you charge someone a premium for a limited-edition design and — months later — that customer sees the same item still listed on your site, they’re going to feel cheated. You have to be confident in your demand levels and you need to know that your drop really will sell out.
Overall, limited edition product drops are a great way to boost revenue and grow a business. Limited Edition is not a passing fad — it’s a legitimate sales technique that has been used for more than one hundred years. Very few marketing strategies can claim to have worked for more than a century. Fewer still can deliver an overnight bump in revenues. Our advice is to give it a go. Spend a few hours thinking about how you might launch your own limited edition drop. And let us know how you get on!
Thanks for reading!