The term “Commerce” has got multiple facets which includes online commerce, brick and mortar commerce and mobile commerce. However, the purpose served by all these sale channels is to guide businesses to reach consumers effectively, and to gauge the consumer experience through their feedbacks.
What it would have been if consumer’s expectations turn in to reality. Imagine, if your product is being embraced by the consumer at the concept stage, and you’re able to create the demand even before it is manufactured.
Well, these thoughts are brought into reality by a concept called as “Pretail”. Now, what is pretail all about? Pretail can also be called as pre-retail or a pre stage of retail that helps businesses to understand the market demand through proper assessment of consumer expectations and successfully launch their product into the market.
Pretail being the umbrella term includes pre-sale commerce, pre order retailers, pre-launch marketing services, incubation marketplaces, crowd funding communities and demand chain management systems.
As said above, Pretail is done in multiple ways, and I am trying to shed light on crowd funding and crowd sourcing platforms. These platforms have been effective in treating the demand side and supply side equally, to test their innovative new product ideas. In this context, I consider demand side as the consumers and supply side as entrepreneurs and start-ups.
Gone are those days, where businesses had to think twice before they take a leap into the market with their new concepts/ideas/products. The crowd funding platforms namely Kickstarter, Indiegogo and crowd supply have mitigated the risk of product failure as it allows the businesses to effectively assess the demand for new product concepts in the real world.
Moreover, crowd funding platforms assist businesses, entrepreneurs and start-ups to understand the consumer’s unique preferences, and develop a product that is a perfect fit to the market. Also, it enables to raises funds for start-ups and entrepreneurs to develop their innovative ideas into products, where ideas are also sourced from the consumers.
The data from Kickstarter which is the market leader in crowd funding platforms, shows that it had 11.6 million people across different geographies, who contributed total of USD 2.6 billion till September 2016. This indicates the success of pretail and how it is being embraced in the market as one of the best business models in the recent days.
The factor propelling the growth of Pretail is; consumer’s view this channel as the new shopping destination that can offer them with unique and innovative products that are not available in big brand’s product portfolio.
Pretail is also termed as straight forward retail, where entrepreneurs question the consumer about their new product idea. There are only two possibilities, either the new product idea will be accepted or rejected by the consumer at the concept stage. Hence, pretail allows to test the feasibility of the new product idea and then manufacture the product that can grab consumer attention and create market demand.
Whereas, in traditional form of retail, success and failure of the product is determined only after product being launched into the market. In this case, the risk of product failure is high, as the product is manufactured under the assumption of it being successful, risking the loss of investments and time. However, this drawback in traditional form of retail is also fuelling the growth of Pretail, as it mitigates the risk of product failure.
The example that I could quote here for Pretail success is Dim Sum Warriors, an educational comic that was able to raise funds from Kickstarter. Dim Sum Warriors was successful in making its presence felt in Singapore book stores where it was recommended for upper primary school readers by Singapore’s national library board.
Henceforth, I would like to conclude by stating that Pretail will gain its significance in the days to come, as this category of retail helps businesses to gauge the market demand for their ideas, and not the product. This helps in identifying the potential consumers and their unique requirements for the product to be successful in the market.