A long-term customer relationship doesn't have to start with a high-value transaction. Even a modest brush with your brand has the power to create a lifetime loyalist. 

Not convinced? Let's paint a quick hypothetical. Say a college student purchases a pre-owned sofa on clearance. While this low-margin conversion might not feel like a win for most retailers, it could easily inspire them to return and buy a full-price throw pillow — or even an armchair to accentuate their space. Fast-forward a few years, and that same customer (now out of college with much greater purchasing power) is outfitting their entire home with pieces from that same brand, all because of that seemingly insignificant clearance sale.

Retailers don't always imagine this potential for their clearance inventory. And for good reason — they're often distracted by the present-day headache of trying to profitably offload this low-margin stock. But, with the right marketing strategy and tools behind you, investing in clearance can be a potent way to drive Lifetime Value (LTV).

Let's look at the benefits of marketing clearance furniture and what you can do to unlock them.

Why retailers often sleep on clearance marketing

Despite the tangible LTV benefits of marketing clearance inventory, retailers commonly neglect these products, preferring to let them pile up in warehouses away from customer eyes. While this may seem a bit counterintuitive on the surface, there are several reasons why they take this approach:

1. Low margins: Clearance inventory is often sold at significantly lower prices than full-price products despite having similar costs. Because retailers aren't making as much bottom-line profit on the sale of clearance items, the majority of their marketing budget (including short-term discounts) goes to new stock.

2. Cannibalization: Despite the meteoric rise of ecommerce over the years, the overwhelming majority of furniture sales come from brick-and-mortar stores. Because retailers usually have limited showroom space to display their products, they're often reluctant to replace higher-margin items with clearance. While a dedicated clearance outlet solves this issue, the costs of operating this new venture can be exorbitant.

3. Limited customer data: While data is the foundation of all winning marketing strategies, it's a frustratingly elusive resource when it comes to clearance sales. Retailers often have limited visibility into which purchases were clearance or full-priced inventory, making it difficult to determine their customers' appetite for these products. This lack of visibility can make investing in a dedicated clearance marketing strategy a tough sell to upper management.

When looking at the aforementioned issues, it's no wonder why most retailers pour all their marketing resources into full-price stock. Yet, this shortsighted strategy misses a key opportunity: to nurture new generations of brand loyalists. 

The benefits of clearance marketing on LTV

While the short-term benefits of clearance marketing may appear few and far between, its impact on LTV is not to be taken lightly. When executed right, clearance marketing empowers your brand to:

Create new entry points for a broader range of customers

Showcasing your clearance inventory is an incredibly strong method of attracting new customers who may not be able to purchase your products at full price. 

Take Millennial and Gen Z shoppers, for example. These younger age cohorts often turn to clearance to furnish their homes and apartments on a budget, with aspirations to upgrade in the near future. Marketing your clearance products helps lock in their loyalty early and establish a relationship that can span decades of purchases. We know these initial conversions might not drive much bottom-line profit, but identifying and engaging these price-conscious cohorts is well worth the investment.

Nurture customer relationships that deliver short- and long-term ROI

Marketing clearance furniture isn't just a long-term strategy. Showcasing your more affordable offerings has the very real potential to drive both short- and long-term ROI.

In the short term, clearance paves the way for more cross-sells and upsells. A Millennial shopper purchasing a bed frame on clearance might, for example, be inspired to splurge on a full-price table lamp. Meanwhile, a deal seeker might be so satisfied with the value they got for a clearance dining table that they decide to purchase a set of clearance chairs. In fact, consumer psychology suggests that deal seekers are so motivated by the thrill of a good discount that they're nearly always in the market for their next one, regardless of necessity.

In the long term, marketing clearance products keeps price-conscious customers engaged with your brand, effortlessly driving LTV through an extended relationship of continuous purchases. 

So, how can you deploy a clearance marketing strategy that drives LTV while avoiding the drawbacks? Say hello to SaySo.

How SaySo transforms your clearance inventory into an LTV driver

SaySo helps leading furniture retailers take clearance marketing and sales entirely online in the form of co-branded storefronts. These storefronts act as online clearance outlets, shepherding your customers to your lower-priced products without sacrificing showroom space in the process. Even better, because clearance products can be marketed and sold on your co-branded site without ever having to leave a warehouse or distribution center, each sale generates significantly higher ROI.

While selling individual clearance items online can seem like a major drain on time and resources, SaySo makes this refreshingly simple. Because the platform ingests the entirety of your product catalog, listings for clearance items come pre-populated with critical SKU information and even stock images. All you have to do is enter a few details about the specific condition of each clearance product, and you've got a complete listing ready to showcase to potential buyers.

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Of course, simplified product marketing, pre-populated listings, and reduced costs are just the tip of the iceberg. SaySo also offers gamified shopping experiences (in the form of Dutch auctions) that instill urgency and empower you to recapture the value of your clearance inventory. Rather than having to accept the rigidity of traditional brick-and-mortar shopping, customers participating in Dutch auctions can bid on clearance furniture at the prices they want to pay. Plus, SaySo captures all bidding and sales data on the backend, effortlessly informing your clearance pricing strategy and helping set profitable asking prices on future auctions.

With SaySo, the threats surrounding margins, cannibalization, and customer data become a thing of the past, helping lay a foundation for a clearance marketing strategy that drives LTV. But don't just take our word for it. Consider the case of Ashley Canada, who drove a staggering 6x boost in ROAS and a 20% reduction in operating costs since launching its Ashley x Descend storefront with SaySo.

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Are you ready to give new life to your clearance stock?

See how SaySo can help you turn clearance inventory from a burden to your competitive advantage by booking a demo today!

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