Intro
Some products do not enjoy high popularity and do not sell for several reasons. When unsold products mount up in the warehouse, this is called deadstock. It is costly for retailers to hold up products that do not leave warehouses. As a negative result, it affects all metrics and shrinks margins.
It is not always possible to completely avoid deadstock but awareness about this product segment is key to maintaining healthy profitability.
It also allows retailers to select an appropriate strategy for limiting deadstock such as:
Better inventory planning in the future
Running a special discount promotion
Allocating less advertising budget
Excluding from promotion altogether
Setup
Define a threshold for Product Quantity sold (GA/GA4 metric) for the last X days.
The prerequisite is a correct connection of analytical assets per market and inventory. These include:
Product Quantity sold
Product detail views
New products are identified based on whether the product had any detail views in the time before the selected timeframe. If there are no detail views recorded, then the product is considered new product and cannot be classified as deadstock, even if it has zero sales in the selected timeframe.
Best Practice Tips
When selecting the appropriate strategy for Deadstock, look for the % amount from All products and the portion of the ad spend. Low percentages usually mean a healthy product turnover. High percentages are signaling issues with products that do not sell.
Avoid excluding a large percentage of products from advertising. It is likely that your advertising performance will suffer in the short term before the ad algorithms find other products to promote. The issue of deadstock will not get resolved either.