February 25, 2024

Oh, It Adds Up

Let's look at an example.

  • You have a winning item.
    • It sold 50,000 units last year at an average of $30.00 each, for $1,500,000 in sales.
  • However, this item has negative Merchandise Residual Value ... negative $10.00 in the next year.
    • This means the item will cost your brand $10.00*50,000 = $500,000 next year.

Is the item truly a winning item? That's a good question! It generated $1,500,000 in sales, but it will cost your brand $500,000 next year. In other words, it's actually a $1,000,000 item.

Every single one of you manages a brand where this happens. Every single one of you.

You can't stop customers from buying that item.

But as a marketer, you are under no obligation to FEATURE that item, now are you?

If you aren't already performing this style of work, contact me now (kevinh@minethatdata.com) and we'll get started, ok?

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