As a business owner, you’re looking to give your customers value for money. One of the biggest (and most expensive) mistakes that you can make here is not recognising the difference between giving value for money and being cheap.
Also, constant discounting puts you in danger. Not only is there the danger of price wars (where nobody really wins), but there is also the danger of attracting the wrong kinds of customers… You know, people who spend all day looking for “deals”, and wouldn’t even consider spending another penny once the offer expires.
This leaves you with two choices… You can either run your business on constant discounts, that eat away your profit margin, or you can lose these customers. Nobody wants to be in that position. SO here’s how you avoid it…
As I stated earlier, your customers are looking for VALUE for their money. When you look at things this way, both you and the customer can be better off.
For example, let’s say you’re a salon owner, two types of facials… A standard facial at £25, and a deluxe facial at £35, there are tons of offers that could be made.
You may choose to do a simple “£10 off standard facials”… This way, the value to the customer is £10, and the cost to you is £10. You’re essentially GIVING the customer £10. The benefit to you is that you may earn some new customers. However, when you put the price back up, quite a few of them will probably leave… Who wants to pay £10 extra?
However, if you were to give the customer a “Free upgrade to a deluxe facial”, the cost to you will be more like £2, and perhaps a few minutes of extra time. However, once the offer is over, the customers who LOVED the deluxe facial will come back for more. And the customers who don’t want to pay extra, can simply settle for the standard version. Yes, some people will still leave.
But what you’ve been able to do is showcase a new product, lower your cost, and lower your risk.
So… Which do you think is better?
There are many ways in which you can creatively put offers together for your business… But simple discounting will often end in tears. For more information on creating compelling offers, click here.