Increase Sales With A Good Discount Strategy
How can you persuade a person to buy your product or use your services? It is a fact that people will be more attracted to a certain product only if it has a discount. It is one of the oldest tricks in the book, but not everyone does it effectively. If done correctly, a discount strategy will actually help in increasing overall sales despite the fact that you are decreasing the prices of your products/services.
In a podcast series hosted by Creative Thirst‘s Bobby Hewitt, Convert shares some of its insights on how to turn more clicks into customers, which is essentially what conversion is. Conversion is the marketing technique of turning casual visitors into paying customers. In this podcast, Bobby talks about how giving a discount can increase your conversion rates and how it relates to persuasion. We will also tackle what discount strategy is better.
Give a Discount
(Y)ou need an effective discounting strategy if you want the short-term increase in traffic to make a difference for your company long-term.
According to Divyesh Patel: “Discounting the price of your product or service is indeed an effective way to increase sales and market share. But while this is true, you need an effective discounting strategy if you want the short-term increase in traffic to make a difference for your company long-term. The pricing strategy is one of the most important elements of a marketing campaigns as the price directly impacts the amount of profits you make on each and every sale.”
When it comes to shopping, we all want to save some money. Many marketers conducted studies and tested their visitors. The results showed that the most effective way to persuade your visitors is to offer a discount. This all comes down to the basic need to get something more for less. And while it may seem to be a bad deal for the seller, getting more customers will actually help the business in the long run.
Fixed or Percentage
Percentage off – by virtue of default – seems like a greater savings to most of the shoppers.
As cited by Bobby, a study conducted in the July 2007 issue of the Journal Marketing found out through research that customers are more persuaded by a percentage off vs. a dollar amount off. If we look at it from a persuasive design perspective, we would realize how simple it is. When you offer a certain amount off of your product or service, the visitors will immediately change their perception. They will become more interested to find more information and buy the product. Percentage off – by virtue of default – seems like a greater savings to most of the shoppers.
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Now, what discount technique should you use? Some use a fixed amount and some a percentage off of products. Let’s compare – If you put an offer of $5 off, the visitor may not be attracted so much; but if the discount is a 40% off, everyone will become interested. A %-off is much desirable because it depends on the price of the product. The higher cost the product, the more %-off you get from it; and customers really like a big discount. We all know that the higher the discount is the more likely a person would make a purchase.
Expressing the discount with percentage is much more efficient. Let the customers do the math, which will be more interesting. Then they will become interested in finding out more about the product. This is one of the smartest persuasive techniques every marketer should use. Every shopper looks for discounts in order to save some money. No matter how big the discount is, the shopper will be attracted and probably make a purchase. Always use two numbered discount to make the persuasion effective. Here are examples:
- 12% off for blue marked items
- 23 % off for every $100 purchase
- 15 % off on all XXL items
Even the smallest discount will persuade visitors to click and find out more about the product. If it solves their problems, they will most certainly make a purchase. If you gain anything from this, you are guaranteed to get the attention of otherwise uninterested buyers, which will get them in your website, which increases the opportunity for conversion. Do you want to know more? You can visit us at over at Convert.