Discounts are a great motivator when it comes to purchasing items for so many people. Who does not love a great deal? Most of us do, even we as marketers and businesses cannot seem to resist a good one. Discount marketing strategies have everything to do with our human psychology and the perception of value. It essentially means comparing a discounted item with its original price to determine and evaluate its value. Moreover, when we get a valuable deal it influences our decision-making in purchasing.
Based on Psychology of Discounts Statistics, 80% of customers would try a new brand that offers a discount. Additionally, 48% would not buy from a brand if no discount was offered. This means customers will try your brand if you offer deals compared to if you do not. Having discount marketing strategies in place is a powerful trigger to get customers to buy so you can increase sales.
In this blog post, we will learn about:
What is Discount Marketing?
Discount marketing strategies use promotions to attract and encourage customers to shop with your business. It can be carried out as a short-term or as a long-term campaign. Furthermore, discounts encourage customers to spend more with you especially when sales are slow. Moreover, it helps clear out old stocks and boosts your customer retention rate through a loyalty program. Discount marketing is all about the psychology of consumer behaviour. Take, for example, the word “free”, people change their behavioural patterns when there is something free.
Types of Discount Marketing Strategies
Percentage discount
This is the most common discount used, it offers customers a reduction in the price based on a percentage. For example, a 15% discount for a $100 product. Percentage discounts make customers believe they are saving more money. The higher the percentages the more customers will be drawn to purchase. It works better on customers when it is 20%, 33%, and 50% with the urgent messaging of limited time only. Additionally, it is usually more ambiguous than a dollar amount discount. Try out The Price is Right Interactive Popup that provides them with an enjoyable experience while also rewarding them.
Dollar amount discount
Dollar amount discounts deduct an amount of cash from a product such as a $10 discount on a $100 product. This discount is straightforward, and customers do not need to waste time doing calculations. Moreover, a dollar amount discount is an appealing deal that convinces them to instantly purchase. Furthermore, it is best used for products over $100 like technology such as a smart TV or computer. You can offer a $100 discount on a product that costs $1000.
Free shipping and shipping discount
Free shipping discounts offer customers free shipping or a discounted shipping fee for buying a product online. It is best used for online e-commerce stores to get customers to check out when they have abandoned their carts. Customers are more likely to make a purchase if you offer free shipping.
Moreover, utilize this type of discount to offer free shipping to customers who spend over a certain amount. For example, free shipping for purchases over $250 so customers will buy more items to enjoy free shipping. Additionally, their purchase feels worth it as they did not have to pay multiple shipping fees for each item.
Limited-time discount
Limited-time discount occurs for a certain period, it could be a discount that lasts for a month or less. This discount strategy creates a sense of urgency which plays on the customer’s FOMO, fear of missing out. In addition, fear is a strong emotion that can motivate people to act. In this case, it pushes customers to buy because they may not get another chance at such a great deal. Customers do not think before purchasing if there is limited time, it drives them to make an impulse purchase. You can utilize this Hourly Surprises template to offer limited-time discounts to your customers.
RELATED: 10 FOMO Marketing Examples You Need to Try Today
Bundle discount
A bundle discount works by pairing multiple products together and offering at a single discounted price. It gives customers the impression that they are saving a huge buck by buying the products together instead of separately. Moreover, you can create different bundling options that customers can choose from. This discount marketing strategy works when you pair items that complement each other such as a keyboard and mouse. It helps increase sales of unpopular products by bundling with a fast-selling product. The most common bundling discount is McDonald’s burger set meals which offers value for money.
Clearance sale discount
A clearance sale occurs when you are trying to get rid of old stocks and make space for new items. For example, a clearance sale for winter or untrendy clothes to make way for spring clothing. Clearance sales last based on availability, as items are available in limited quantities. Once purchased, there are no more stocks left which can strongly motivate customers to buy it.
Flash sales
Flash sales are another discount strategy that invokes FOMO in customers, it is similar to limited-time discounts. A flash sale usually lasts for 24 hours or for only a few hours to create that sense of urgency for customers. This discount strategy works best when you want to draw the attention of your customers and when you want to increase short-term sales. Additionally, flash sales are commonly used by e-commerce websites, they occur every few months or on special days like Mother’s Day or Black Friday. Since flash sales are time-sensitive, you can promote them on your social media channels and send your customer base an email to notify them of the sale.
Volume discount
A volume discount is a discount that is given to customers who buy items in large quantities or a huge stock. Furthermore, the price per unit drops when a customer buys a large amount of that item. For example, the price per unit is $200 but when customers buy 20 units the price per unit drops to $130 which means customers save an additional $70 on each unit. This discount strategy encourages buyers or customers to buy in bulk as it would be more cost-effective than buying a single unit. This discount is best used for B2B as it benefits both the supplier and retailer or buyer. You can even use it in B2C especially if you are a supplier of household goods and you are selling straight from the warehouse, to encourage customers to stock up on goods for their home.
BOGO deals
Buy one get one free is a promotional deal that offers customers a free product when they buy one item. It can also offer customers a discounted price on the second product when they buy those products together. For instance, if you buy a graphic tee, you can receive another graphic tee for free. This discount marketing deal can be used when you are trying to clear our additional stocks or attract shoppers to your latest product. Additionally, it is a tempting deal that is too good to pass up since they will be receiving an extra free product.
Promotional gamification
Promotional gamification is when you allow your customers or website visitors to engage with a game for a promotional discount or reward. Let your audience play with fun games such as Discount Card Surprises where they can pick a card that rewards them. It is also known as Interactive receive Content which is content that your audience can engage with and play an active role in, compared to passively viewing. There are many kinds of Interactive Experiences which you can use to modernize discounts such as Interactive Popups, Marketing Games, and Forms.
Benefits of Discount Marketing Strategies
- Increases revenue because discounts drive customers to make a purchase
- It attracts new customers as deals are too tempting to resist and customers will try out a new brand if it offers a discount.
- It builds customer loyalty because customers feel like they are rewarded for staying and shopping with your brand.
- Boosts customer retention rates as customers are most likely to stay with a brand that offers good service and exclusive discounts to their patrons.
- It helps you clear old and outdated stocks so you can make way for new products that are currently in season.
- Boosts feeling of happiness in your customer as a great deal can make your customer’s day.
Create irresistible discount marketing Strategies that motivate customers to spend
Discount marketing strategies can bring your business a long way, they increase revenue, attract new customers, and help you retain your existing customers. Acquiring new customers through paid advertising can cost more than implementing a promotional pricing strategy so why not create a discount strategy combining these different types of discount marketing strategy.
Attract customers and let them know you are having a discount or sale going on with Interactive Content and Interactive Experiences. Add Interactive Popups to remind them of an ongoing sale or use Marketing Games or Quizzes to lure, engage, and excite them about your promotions.
Our Interactive Content Tool at Dot.vu allows you to create Interactive Content that you can embed onto your website or integrate with your software. Explore over 300+ templates to start enticing your customers with irresistible deals that they are tempted to click on and interact with. Create your free account today and start making Interactive Experiences without needing to code.
