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When sales are slow, every owner knows it's time to generate revenue. And, a majority of owners go directly to offering discounts to increase sales. Yes, lower prices can give you a sales spark, but it is detrimental to your brand and unique value proposition in the long term.


Before discounting, we suggest you ensure your sales & marketing strategy and marketing plan have addressed generating sales at the fair market value and at or below your competition. The only time you should discount is when physical inventory has proven to not move at its current price point, and the only way to move the product is to lower its value. Offering discounts is a loss prevention method used to recover previously spent money. Use it properly and retain what profit you and never give money away.


A discount indicates that you have devalued something to be less than it was originally thought to be worth. It can make items more affordable, but in most cases, it only encourages sales to individuals only looking to save. Discount sales bypass the critical value proposition where you gain loyalty and repeat customers which makes discounting a bad business practice in regards to building brand loyalty.


Strategically, once a consumer has purchased at a lowered price, it will be virtually impossible to convince them to repurchase at a higher price. Also, when it comes to your active customers, we recommend steering away from discounting. Instead, offer those that are active or recent buyers an added value incentive.

    Instead, when sales are slow to ask two questions:
  • 1st, can you afford to acquire new customers?
  • 2nd, what promo will trigger existing customers to buy again?

It is essential to understand that promoting New vs. Existing customers have very different approaches. The cost to acquire new customers is going to be higher. New requires more money and longer time frames to find, educate, and secure their interest. While this audience has a more significant potential to grow your revenue to higher levels, it does also require larger budgets to accomplish its goals.


In comparison, promoting to existing customers, in most cases, is less expensive and will have a more immediate impact on revenue generation. All businesses must establish a reliable marketing channel to motivate their existing customers, no matter the size or market share. When it comes to promotions, your creativity, product knowledge, and the ability to connect with customer motivations will determine the success of your campaign. For both, short and long, term success, get to know your customers. Understand why they buy from you, then go find more new customers just like them!


NEED PROMO IDEAS!


If you're a retailer, consider promoting exclusive pre-sale access to the up and coming Black Friday Deals. Make the offer available to a limited number of customers that purchase X amount of goods/service within the next 48 hours. In addition to exclusive access offer, add a bonus add-on with their current purchase. Give away some branded swag that draws them in and extends their relationship with your company's values, strengthening your brand.

Looking to move inventory, consider bundling Go-To products with slow-moving items. Bundle deals are a great way to move products while raising the average ticket of your transactions.