In this fourth post in a series based on the Art of the Drop report, we break down the first component of a successful drop — the planning stage

Product drops can be one of the most effective ways for brands to create hype and solidify customer loyalty, but behind each seemingly random “drop” lies meticulous planning, supply chain optimization, and tonnes of customer data and market research.

PSFK's recent report called The Art of the Drop, developed in partnership with PCH, breaks down the product drop into three key components: planning, execution, and leveraging the drop for maximum impact. In this article, we explore the first component of a successful drop — the planning stage, from logistics and product design all the way to planning fulfillment and creating demand. Below, six key trends are laid out that help to illustrate the ways in which brands can successfully plan a product drop.

Data-Driven Design

In the age of the drop, data is increasingly at the heart of product design, with 50% of surveyed companies reporting that they currently leverage planning and forecasting tech. By harvesting customer feedback through technology to inform the product development process, brands are able to integrate consumer preferences to achieve a well-designed product. Online Food community and publisher Food52 is doing just this by leveraging feedback to guide the design process for Five.Two, its line of kitchenware, and choose which items to release next. In exchange for participating, subscribers receive early access to the merchandise.

Crossover Collabs

Designing limited-edition collections in collaboration with another brand or cultural figure in order to bring together two communities of fans is one of the most common drop strategies, not only generating excitement but potentially introducing a brand to an entirely new audience. Big box retailer Target, for instance, pioneered a designer collaboration, offering high-design items at an accessible price point. To fête the 20th anniversary of its first collab, Target released a limited-edition collection of 300 reissued products from 20 partner designers over the years.

Predictive Merchandising

Being able to predict what consumers want before an item ever hits store shelves is now a pivotal part of the drop strategy, with 33% of retailers currently using advanced analytics for merchandise planning and another 48% planning to. By harnessing data and predictive analytics to uncover shifts in consumer preferences and accurately forecast demand, brands are able to improve supply chain efficiency, merchandising strategy and inventory management. For instance, in the Nike Live concept stores, products are stocked based on the purchasing habits of local users. Using data collected on the NikePlus app, each store’s inventory is dictated by what shoppers in the neighborhood are buying.

Designed Scarcity

Exclusivity and scarcity have long been among the core strategies employed by streetwear and luxury brands alike, but can be effective tools for any brand if used correctly, cutting costs and minimizing waste while driving interest in limited editions. Fashion e-tailer Choosy, for instance, analyzes trends on social media platforms, then quickly creates its own merch based on the most popular styles as well as direct consumer feedback polls, churning out samples in just a few days as well as having items available for purchase via twice-weekly drops on its site.

Flexible Fulfillment

Key to any successful drop is a nimble supply chain that ensures that orders can be fulfilled in the way that best meets shoppers’ in-moment needs for speed and convenience, wherever they are. E-commerce platform Shopify, for instance, has created its own fulfillment network in order to help its client brands and stores. When a customer finishes checking out, the platform leverages machine learning to locate the closest fulfillment center, calculate ideal inventory numbers, route inventory and settle rates with logistics providers to ensure fast delivery and low costs.

Demand Creation

The lead-up to the drop is a crucial time for brands to generate buzz around their product launch. Using targeted messaging to reach desired consumer demographics and fostering community among brand fans by making them feel in the know all help to create a sense of urgency and excitement ahead of launch. For example, ahead of its C Club sneaker release in collaboration with Cardi B, sportswear retailer Reebok issued free special-edition sneakers encrusted with crystals to select fans, asking them to enter the running by simply saying a prompt like “Open Reebok Sneaker Drop” to their Alexa or Google voice assistance.

This article is part of a series based on PCH and PSFK's Art of the Drop report—download the full report free here