In this tip, we’ll be covering several different discount strategies, all of which are proven to get results.
1. Percentage discount
Probably one of the easiest strategies to set up, this discount is a certain percentage off the regular retail price. You can either use coupon codes to target groups of customers, or offer a percentage discount storewide.
2. Money off discount
This is where you’d offer a straightforward fixed amount of money off certain products. It’s very similar to the percentage discount, but it may not be as effective on low-priced items. For example, $5 off a $10 product doesn’t sound all that enticing. 50% off sounds better.
3. Flash sale discount
A flash sale is where you’d offer a heavy discount on certain products or product ranges for a limited time. That might be three hours or 24 hours. Flash sales work really well to drive sales if you undertake them correctly and create a buzz and sense of urgency around them.
4. Threshold discounts
This is where you’d run a “buy more, save more” offer. Your customers would receive a discount in stages. The more items they buy, the larger the discount they’d get. Threshold discounts can help you extract more value out of the same customer, without costing you anything extra in acquisition costs.
5. Multi-buy deals
Buy One Get One Free (BOGOF) or tiered bundles, e.g. buy X and Y products and get Z free, are types of multi-buy deals. This type of strategy is particularly effective when you need to shift leftover stock and helps you increase your total order value.
6. Free gifts
This is another good option if you need to offload some of your inventory. For this strategy to be effective, you must offer an enticing free gift - it’s got to be valuable and appealing to the customer.
7. VIP discounts
Here, you’d offer an exclusive discount to certain groups of customers. This strategy is best used for building customer loyalty. You can offer a VIP discount to reward specific customers, to make them feel valued and to encourage repeat purchases.
Note that not all of these discount strategies might be right for your store. To help you work out which ones might be best for your business, read this detailed guide over at the Firepush blog on discount strategies for Black Friday. It explains the strengths and weaknesses of each of these discounts and has some bonus ideas too.