We all appreciate a discount and finding a good bargain – and with the evident popularity of deal sites and increased mobile purchasing behaviour, it’s now even easier for consumers to find one.
17 May 2013
We all appreciate a discount and finding a good bargain - and with the evident popularity of deal sites and increased mobile purchasing behaviour, it's now even easier for consumers to find one.
This is putting more pressure on retailers to offer the best discounts around and, where historically discounts have always been a sure fire way of driving big sale volumes on a quick turnaround, it's now crucial to make sure they are not affecting your margins.
Discounts work because price is a huge deal to consumers and research in 2012 shows 60%* of web shoppers now subscribe to deal sites. This ultimately means that price competition is at a new level and is standardising discounts as an accepted part of retailing practice.
The growth of mobile purchasing is also heavily influencing the popularity of retailer discounts with the popularity of local search and time sensitive, geographically based offers. It's now important to be mindful when utilising the value of the discount options on offer whilst still maximising the margin opportunity from each customer.
There are many situations where discounting is a viable option, whether it's clearing excess stock or driving customer loyalty by securing a first time purchase. And, by utilising discount sites to highlight an attractive discount early on in the shopper's online search journey means that you could avoid later marketing expenses such as PPC.
However, in this competitive world where retailers are trying to intercept online traffic with the best possible deals, it's about getting the best value deal out there tactfully without increasing cost per lead. Be strategic when offering discounts and be careful not to go overboard and de-value your brand.
Only revert to discounts when all other avenues have been exhausted. Check your creative to make sure it is appealing to your target market, your content should be relevant and easy to digest particularly highlighting the unique selling points of your product or service and include eye catching imagery where possible as well.
It's better to treat discounts as a last resort method, try to find a more strategic approach to improve conversions before you resort to a deal. Best practice is to only offer discounts to those customers it will really make a difference to and by offering them only the amount that will make them convert.
(*Why discounts should always be the last resort - Ian McCAig - 13th May 2013 - Econsultancy)