Get Results from Discount Strategies and Tactics

     

Published: March 9, 2020

Pricing your products and services appropriately can be one of the most challenging aspects of your sales process. On the one hand, you need to bring in enough to cover your expenses and bring in a bit of profit. On the other hand, buyers are always going to be motivated and driven by price so you want to make sure your prices are in line with their expectations.

Discount strategies and tactics can be an effective way to increase your sales, but there are some pitfalls to be wary of. If you want to find success through the right balance of income and incentives, we’re here to show you the way.

Pricing is More Than Money
How you price your products and services affects more than just how much your customers are paying and how much income you’re bringing in. Pricing also affects how people see your company and how much value they assign to your work. If you blindly offer discounts rather than working through the process of creating discount strategies and tactics, you could end up hurting your brand and reducing your profits.

Without a plan, discounts condition your customers into devaluing your efforts and products. Plus, you could also be setting up an expectation for pricing that results in either the customer looking elsewhere for better pricing once your sale is over, or having to haggle and provide long-term incentives to keep that customer.

Of course, not every sale, discount, or promotion ends up in the red. Most businesses that use them strategically find great success, and you can too.

Always Start With a Goal
With preparation, discount strategies and tactics can boost your sales volume and entice new customers to give you a try. Periodic coupons and offers can help people feel good about getting a special price, and it can prevent people from spending too much time comparison shopping on the basis of cost. To achieve these benefits, you first have to choose which one to pursue. Your strategy should always begin with a specific and measurable goal. For example, are you trying to acquire new customers? Sell a higher volume of products? Encourage repeat business? Move old inventory to make room for new arrivals? By how much? Discount Strategies and Tactics That Work Once you know what you’re trying to achieve, then you can choose discount strategies and tactics designed to help you meet those goals. Here are some examples, along with what to look out for with each one so you make sure you protect both your brand and your bottom line.
  1. New Customer Discounts. If you’ve ever shopped for new products online, chances are you’ve been hit with the pop-up that offers you a coupon for your first purchase in exchange for your email address. These can be effective, but you should be careful about how soon these pop up. For some people, they’re still in the very first steps of the buyer’s journey and are not at all ready to make any commitments.

    It’s also critical that you use cookies to make sure you’re only showing these offers to brand new visitors, and that the copy of the offer is personalized so new customers know this offer is not for everyone. That way, you don’t run the risk of devaluing your products or creating an expectation of ongoing discounts.

  2. Loyalty Rewards. On the flip side of the new customer discount is the loyalty reward. These can be a great way to encourage repeat business and to boost the total volume sold as each customer is incentivized to buy more and save more.

    If you’re not sure that a loyalty club is right for your business model, consider personalized rewards for customers based on past purchases. Or, you can offer other incentives such as free shipping for club members.

  3. Holiday Promotions. One thing to keep in mind is that people are prepared to spend money in the days leading up to a holiday. They are also on the hunt for a deal, especially for consumer goods. If there’s any time to put your discount strategies and tactics to work with less fear of devaluing your brand, a holiday is a good time.

    Another way to add incentives for a holiday without offering a discount is to provide content that inspires sales around the holiday. For example, you can create content such as gift guides, recipes, and craft ideas with product suggestions.

  4. Referral Rewards. Every business owner knows the value of referrals as word-of-mouth advertising is one of the most effective ways to reach new customers. When you provide a bit of incentive for those who spread the word, it’s a double win as you’ll be encouraging new buyers and repeat business from the person doing the referral.

    This is also an excellent way to boost sales without creating any expectation for future discounted pricing or devaluation of your brand. That’s because you’re exchanging something of value with a customer: they give their time, effort, and compliments and you give a discount as a “payment.”

  5. Bundles. Discounting the price of bundles of products will help increase the number of items you sell, help you move less-popular products, and provide a way for customers to try some of your other products. Plus, the entire package is seen as less expensive to the customer rather than viewing an individual product as having less value.
To make bundled products work, be sure to pay attention to what customers are buying to group similar items together. Or, find products that address similar or related needs. The idea is to have it make sense to buy the bundle. For example, a smart bundle would be peanut butter and jelly, not peanut butter and shoelaces. The latter just makes it look like you’re trying to get rid of one or the other, not help the customer.

Always Do the Math!
Before releasing your discount strategies and tactics to your customers, always do the math to be sure you’re growing your bottom line and not losing money. Successful promotions also require advertising, so keep these costs in check with careful segmenting of your marketing and checking in with the results of marketing efforts to make sure you’re spending wisely.

If you’re not sure how to create a strategy for growing your sales, or you’re concerned about marketing your promotion while keeping costs in check, we can help! Contact us to schedule a no-obligation consultation today.

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