Discounting Kills your business.
Stop Discounting and Start Rewarding. When you discount, you lose money at the till. A perfect example is a $20 discount on a $100 item. Now you only collect $80, not $100! But you still gave away $100 in value.
Instead, offer 10% more if your customer loads an app or a gift…
card. For instance, buy a $100 gift card, and we will add $10. You just received $100 which is $20 more than the scenario above and gave a value of $110.
Another great way to add value to your business is with a limited time offer like: Load an app or gift card for $100, and we will instantly send a $20 gift to a friend or family member for free. Again, you received $100 vs $80 in the first scenario.
Stop Discounting and Start Rewarding
How much does $20 of value cost you? $10 or less? Discounting $20 will cost you $20, stop discounting and start rewarding. Add $20 of value, which only costs you $6. You received $20 more at the till; net is $94, not $80: money in your jeans, value for your brand, and satisfaction with your customer.
I haven’t even talked about deep discounting, let’s look at these coupon companies who require you to give a discount anywhere from 40% to 60% on average and as big as 90% or more. The crazy part is once someone buys your deeply discounted product or service you only get to keep 50% of the money collected, the coupon company get 50%, and now you have to fulfill your promise. STUPID is what comes to mind.
You have a $100 service that you sell on the coupon site for $50. You only keep $25, and it takes 1 hour of your time or staffs time to honour the coupon. You might have covered your wages but what about your overhead? What if you sold 300 deals? How do you accept them in a timely fashion? What happens if a full paying customer comes to your door, but you have booked your calendar for months servicing the deal hunters?
Have you ever bought a deep discount coupon and became a regular/loyal customer of that business? Didn’t think so, what are your thoughts on attracting deal hunters vs rewarding loyal customers?