Something to think about if you've ever found yourself offering discounts to drum up more business.
Have you ever found yourself offering discounts to drum up a bit more business? Especially around either quiet times in the year or to “take advantage of” seasonal events?
Whilst they may seem to work, let me suggest that they harm rather than help both your business and your clients.
Why discounts may harm your business in the short and long term
I’m going out on a limb, but I’m presuming you know exactly what your service and products cost to provide. And so you also know how much profit you’ve got on top of that.
I’m going out on a limb again, but I’m thinking that the profit margin you’ve put on top of your products and services is not going to be enough to pay for a luxury yacht, a new Mercedes Benz or a Paris shopping spree. It’s going to be enough to keep your head above water. And probably only just.
Whenever you offer a discount you slash your profit. So offering a discount in the short term will affect the amount your head is above water. Depending on your profit margins you might be blowing bubbles or even need a snorkel set - you might be taking a loss on some products.
In the long term you’re setting your tribe up to expect discounts.
I found myself doing totally predicable tribe behaviour like this the other day. I’d been longing after this gorgeous pair of pants in a shop, but holding off buying until the sale. Then this week there they were in the sale. And now they’re in my wardrobe. If I knew there wouldn’t be an end of season sale then I would’ve bought them then and there, giving the shop more profit.
But I’d been trained to expect a sale, so I waited.
Why discounts may harm your tribe
Offering a discount can reduce the perceived value of your product or service. If you reduce the value that your tribe think they’re getting you’re making it less likely that the person will actually DO the service. They can be less engaged.
Okay, you want your business to keep making money, but really we all want to be helping our tribe. And setting them up to be less engaged is doing them a dis-service. It’s not giving them value.
How you can supersize your sales without using discounts
But wait, there’s more.
Have you heard that on those incredible infomercials? “But wait, there’s more”. What they’re doing is adding value. And that’s how to supersize your sales without using discounts.
Offer a service or product with a bonus attached, that’s high value to your tribe.
In my web edit and SEO check service package I add in for a bonus a sales page template that clients can use themselves to format and write their sales page using tried and tested strategies.
In my Confident Business Blogger course I add in a bonus of my e-book packed with tips on how to write and edit for health and wellness tribes.
Two simple ways to choose your package up bonus item
If you’re selling a massage session, you could add value with a take-home product (body lotion or moisturiser), an additional service (such as facial) or a pdf guide to self-massaging your feet (or partner).
If you’re selling a coaching session, you could add value with a series of workbooks clients can work through on their own, a reflection journal or a free workshop session.
If you’re selling a weight loss service you could add value with a recipe folder, group support for weight loss or guided meditation.
If you package up, in other words add bonus's which are high value to the client then you get people seeing it as valuable to them AND they're more likely to do what they're buying because they're engaged in it.
And then you sell the value.
If you want to find your simple, clear message to help you connect with your tribe and see your business grow, drop me a line. Together we can make sure you’re really clear about the value you can offer your clients.