These days, if you aren’t offering a discount of some kind, you might not be selling much at all. Pervasive discounting spurred by the sickly economy has caused buyers to demand deals on anything and everything.
Here are the keys to successful discounting:
• Make the discount relevant: Devise an offer that not only will appeal to your clientele, but also one that jibes with how those customers buy from your business. For example, a “buy-one, get-one-free” (BOGO) offer may appear strong on the surface. But if your customer wouldn’t typically buy multiples at the same time, it’s not likely to work well.
• Commit to your campaign: Whether you use postcards, coupon packs, e-mail or online ads, frequency and consistency are important. Prospects may see an offer but not respond right away.
• Balance strong discounts against your bottom line: Structure discounts that can get customers in the door, but still make money for your business.
• Set goals and measure your results: Balance results with objectives. Was your goal to generate new customers? Drive more phone calls or Web site visits? Promote a new product or service? Don’t just file away coupons you use to promote your discount.
• Don’t forget to prepare: Some businesses that offer a discount for the first time aren’t properly prepared for the response. If you attract customers to try your product or service, but you’re not able to serve those customers at your best level, you’re shooting yourself in the foot.
• Don’t treat people who buy at a discount as second-rate customers. Make them feel wanted, welcomed and appreciated. Training your staff to handle promotions is just as important as the offer itself.
• Don’t target only new customers: Offer extra discounts for repeat business: One way to turn new customers into repeat customers is to establish loyal customer discounts of some type. Loyalty cards (buy nine get the 10th one free), birthday discounts and referral rewards are several examples.
• Don’t get yourself in hot water: Be careful with the wording of your discount and on-sale offers. Clearly label what’s “on sale” and what isn’t. If you advertise discounts of, say, “up to 50 percent off” the Better Business Bureau suggests that at least 10 percent of the items be offered at the maximum amount off. •
Daniel Kehrer can be reached editor@business.com.
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