Why offer a discount?
Discounts on goods or services are a great strategy to swiftly attract new consumers. When clients learn that they may save money on items or services that they want, are likely to use, or have considered using, a discount is likely to attract their attention, even if they have never heard of your company before. Discounts may help you boost your bottom line as well as bring in new business and attention as a marketing tactic.
What are the benefits of offering discounts?
Attract new customers
Discounts, as previously said, are incredibly appealing to customers and may bring in both new and returning customers. Discounting items and services, especially those that are in high demand, is an excellent approach to attract attention. Word-of-mouth traffic may enormously enhance outcomes on promotions, especially in these days of social media. Improved traffic online or in-store (or both) is likely to result in increased revenue for your company.
While the reduced items and services will often generate the most sales, increasing traffic to your store or website implies that other products and services will become more visible to customers and potentially purchased. While they’re there, the increased traffic for one item may lead to purchases of other things.
Improves Brand Image
There are a variety of situations in which a company might provide a discount to boost its image. Targeted discounts (such as seasonal or locational discounts, or discounts for a certain group of individuals) may help a company’s image tremendously. If a company offers discounts to older people, military veterans, or cancer survivors, for example, it exhibits sympathy and identifies itself with certain groups (which in turns draws yet more attention).
Proceed with Caution
However, like all good things must come to an end, discounts shouldn’t be used excessively. If your brand is only maximizing sales through offering promotional discounts, then your customer base is likely to be reliant on them.
Moreover, some customers might also perceive your company or brand to be of sub-standard quality. In order to counter this notion, from time to time, you can provide alternative incentives to your customers as Alex Alexakis, the founder of Pixel Chefs explains.
“The best and most effective incentive that I have personally observed is offering redeemable rewards on purchases. As a result, the consumer receives points/cash in his virtual wallet anytime they use the product. When a customer is dissatisfied with a product, use this system as an incentive. Another good incentive is to offer additional samples to customers. This is an excellent way to incentivize customers and test out any new product that you may want to launch in the market.”