Get In Touch
‘Discounts devalue your product and your efforts.’ ‘Discounts are lazy marketing.’ Have you heard these statements? What do you think about them? And what do your customers think about them?
Modern marketing focuses on psychological triggers. The customer is persuaded not by price, but by creating a sense of scarcity, exclusivity and brand attachment. Instead of discounts – limited editions, VIP access, personalised offers. Does it work? Yes, but… not everywhere and not for everyone.
Practice shows: the words ‘discounts’ and ‘promotion’ still attract attention. Discounts are a powerful tool, but they need to be used wisely. Let’s find out when discounts work and when they don’t.
Include discounts in the price of the product
Calculate in advance what minimum discount you can offer without losing margin, and include it in the price. Stelvel EOOD recommends: if you sell smartphones, include in their price the possibility of a 5% discount – this way, if necessary, you can always offer the customer a bonus without significant losses.
Consider seasonal discounts and promotions. Put festive sales, such as December’s, into your plan and strategy. Not only will this create room for manoeuvre, but it will also help you avoid ‘price tricks’ from customers and manipulation.
Offer more for the same price
If you can’t lower the price, offer the customer bonuses and something extra: a gift, free delivery or improved service. For example, when buying furniture, offer free assembly or accessories. This way, you don’t devalue your product, make your service memorable and maintain a sense of benefit.
Create packages of goods or services
Combination offers are both profitable and convenient for customers, said STELVEL marketers. Instead of reducing the price of a single item, offer a discount on several items in a bundle. For example, if you sell electronics, put together a bundle that includes a TV and accessories and offer a discount. This will not only increase the average cheque, but also make the offer more attractive to the customer.
Offer benefits for the future
Coupons and bonuses for the next purchase are a great way to incentivise repeat sales. If you don’t want to discount right now, offer a bonus that the customer can use later. For example, offer 10% off their next purchase or a gift card that will be valid in a month’s time. This way you incentivise the customer to come back and spend money in your shop again.
Raise the level of service
Often a customer is willing to pay more for better service. Friendly staff, cosy atmosphere in the shop, nice little things all play a role. For example, if your shop sells clothes, offer customers a free consultation with a stylist, perhaps online. This is how the ‘attachment effect’ works: the customer comes back even without additional incentives. People are willing to pay more for attention and comfort.
Do not abuse promotions
Frequent discounts can set customers up to expect new promotions and they will stop buying at full price. Beneficial offers should be the exception, not the norm. Dropshipping Stelvel EOOD experts recommend using promotions in moderation so they don’t lose their appeal.
What kind of discount should you give and under what conditions? One of the famous marketing failures is a case with a delayed discount of 30%-50% on goods that have been left in the basket for more than 30 or 60 days. Users were prepared to wait two months or more to get a significant discount.
Do not manipulate prices
Do not inflate the price of a product to ‘reduce’ it and sell it at a discount. This creates customer dissatisfaction and reduces trust. It’s better to set a fair price right away and offer real discounts or bonuses.
In 2019, several major retailers faced negative reactions during Black Friday when customers discovered that the ‘discounts’ were fictitious. Bottom line: loss of trust from loyal customers and a wave of negative online reviews.
Gifts should be useful
If you offer a gift instead of a discount, it should be valuable and useful. A cheap pen with a logo, a magnet or a keychain will not cause enthusiasm and is unlikely to be a good substitute for a discount. For example, when buying a laptop, you can add a gift mouse or case that will be useful.
Don’t hide the terms and conditions of promotions
Customers don’t like hidden terms and unexpected extras. Make sure that your promotions are transparent: give the customer precise information about the discount, the terms and conditions of its receipt and the time of validity. The simpler and clearer the terms, the more trust your customers have.
In just a few years, the world has moved from ‘self-centred’ promotion of only a product or brand to solutions focused on the real customer. Discounts and promotions remain important tools for attracting attention, but today the customer wants not just a discount, but a favourable and informed solution to their problems. By joining Stelvel EOOD proven dropshipping network, you will have the tools to flexibly manage discounts, allowing you to attract customers without losing margin.