The news outlets and consumers all agree on one thing. Easter eggs were out of stock for Easter 2021.
There were several angry and disappointed customers tweeting about the shortage and news outlets are also talking about this.
It certainly wasn’t caused by people stockpiling Easter eggs. Some speculated that this was caused because people did not buy them early enough. According to an article in The Guardian, Asda said it had seen a surge in hot cross buns, individual chocolate bunnies and even novelty bunny ears, while sales of Easter crafting, decorations and games were up a whopping 207% year on year.
They are using 2020 to compare 2021 with. The Easter Egg orders for 2021 were made based on 2020 sales. Now what do you think is wrong with this statement?
In March 2020, everyone was going into lockdowns, vs April 2021, when lockdowns were easing. When UK retailers were placing orders for Easter eggs in late 2020, lockdowns had eased to a large extent and was in the period just before the next lockdown.
So why did retailers use 2020 orders as baseline for 2021? They anticipated an increase vs 2020, but the increase was not enough to account for normal consumption rates pre-covid.
For those who know this industry, it wouldn’t come as a surprise. Retailer orders are based on or pegged to previous year sales, not based on expected consumer demand. However, consumers do not replicate consumption habits year on year.
Retailers and the brands that sell into retailers need to be more data driven when they place orders during these fast changing times. Consumer preferences and the factors that influence them change on an almost daily basis these days. Expecting consumers to mirror previous year sales and pegging their consumption to previous year sales plus an uplift results in the two extremes – under stocking (lost revenues/sales and angry consumers) or overstocking (cost of the working capital involved).
To learn more about how to use data to predict consumer preferences and order volumes, email me on email@example.com