Businesses, especially those that are just starting out, use discounts as a way to promote certain products they are selling as well as to drive customer interest. As a business, the use of discounts should be something that you give serious consideration to, especially if you are looking to expand your customer base. You should understand that discounting programs can add value, but if not properly managed, can create problems for you and your customers. Here are some suggestions for making the most of the discounts you offer.
Include Multiple Products in the Discount
One of the ways that you can make your discount offers more successful is through providing discounts for a product that is linked to the purchase of another. This type of strategy provides you with a way to promote the sale of a product that you are looking to move off of your retail shelves while promoting interest in another product. This type of program should involve products that are related or complimentary to each other in terms of their use. For example, if you operate a small grocery store you may have a brand of spaghetti sauce you are looking to promote that carries a high profit for you. You can pair the sauce with a pasta (that has a lower profit margin) that you offer at a discount of 10% to 20% (or more depending on your pricing scheme) as a way to sell both items and create interest.
Offer Rebates Instead of Discounts
Instead of providing discounts for certain items that you sell, you may want to consider starting a rebate program for your business. This type of program provides you with a greater benefit that a simple discount, because in the case of the discounts the offer is made and completed once the purchase takes place. With a rebate, the customer has to purchase the product and fill out some type of rebate form in order to receive their money. This provides your business with valuable customer information or data that you can use to customize future rebate programs, direct special offers and compile valuable customer intelligence for your business.
Understanding the different discounts your company can offer will allow you the ability to get the most out of your discount programs, and increase your sales and customer base.