A common issue for e-commerce sites is what to do when an item goes out of stock. Do you delete the page? Do you redirect the page somewhere else? Do you just tell the user the item is out of stock?
That was the question asked at a Google Groups thread and JohnMu, a Googler, replied. Before I tell you what he said, I'll tell you what I think.
From a search engine perspective, if you have a product that goes out of stock and you decide to delete the page, then the search engine will take notice that the page is gone. If you ever get that item back in stock, the search engine can take a long time to reindex and list that page in their search index. Then what do you do? Now, if you redirect the page to a different product, the search engine will also pick that up and if you ever pull that redirect, it can take a long time for the search engine to notice that you stopped the redirect. But if you leave the page there and keep all the content, but say the item is out of stock, however, we have the following related products and link to them. A search engine will keep that page in their index, also crawl the related products and it makes for a happy SEOed site.
From a user's perspective, if you have a product that goes out of stock and you decide to delete the page, then the user will have no recourse on your site. Maybe they will look around your site for related products but they probably will click the back button and try a different site. If you redirect the page to a different product page, the user who is being redirected will be confused - which is never a good thing. If you leave the page and note it is out of stock and list related products, the user will likely understand and be more willing to try the related products before clicking back.
Googler, JohnMu's advice:
Personally, I find being redirected to a different product without knowing why always a bit unsatisfactory. How is the user to know that this product does not exist any more or is just temporarily out of stock? All they see is a different, related product..
With that in mind, I would personally prefer to see a page that mentions that the product they're looking for is not available (at the moment / forever) and that these other related products might be just as relevant to the user. To help search engines, you could use a robots meta tag on that page with "noindex, follow", which tells them not to index the page like this but to still follow the links.
Alternately, using redirect is also a possibility. I wouldn't worry about multiple redirects in a row, unless it is really excessive (I think HTTP/1.0 allows for up to 5 redirects, which should be enough).
Forum discussion at Google Groups.