Discount marketing is one of the effective marketing strategies!
Companies utilise different marketing strategies to reach customers and increase conversions. Discount marketing is one of the simplest, most effective, and most popular ways to gain and retain customers. It holds a particular spot among paid, digital, and social marketing, among others.
Having discount strategies is effective year-round. While customers make excessive purchases on special occasions irrespective of discounts, deals and coupons can increase sales for retailers and online brands by a huge margin. Therefore, companies must know the proper techniques to wield price cuts as a marketing strategy.
Discount marketing uses sales, discounted prices, vouchers or coupons to attract people and convert them into customers. Discount marketing is carried out for a limited time, as selling low-priced products is not beneficial in the long term. The most common and popular types of discount marketing approaches include:
Sign-up/membership discount offers
Buy one get one free offer
Most companies provide discounts based on percentages. The aim of smaller deals (5-15% off) is to entice customers into making their first or second purchase. Meanwhile, more significant discounts (up to or flat 50% off) are given on clearance products. Companies frequently use discount strategies due to their incredible impact on customer retention, conversion, and profits. By expertly leveraging discounts, brands can increase sales profits by more than 70%.
How to Use Discounts as a Marketing Tactic?
It is difficult to convince customers to click the "buy now" button and complete a purchase. However, discounts provide the final push hesitating customers may need from time to time. These discount marketing tactics show how businesses can leverage different deals to observe effective results.
Companies often use email subscribers to build brand awareness, increase web traffic, provide information about new promotions or launches, and boost customer engagement. Unfortunately, brands struggle to grow and maintain the subscribers list, but a sign-up discount coupon can convince customers to join it.
A sign-up coupon should be offered when the customer lands on the website, as it can also help convert leads into customers. It is difficult for consumers to resist a good deal, and giving out their email addresses appears to be an intelligent choice to buy products at discounted prices.
Give Coupons with an Expiration Date
Most consumers don't use discount coupons immediately after receiving them. As long as the voucher is safe in their account, there is no reason for customers to rush over it. However, an expiration date creates the urgency to act and use the coupon before it becomes unusable.
Brands can use various list building tools to gather and collect the email addresses of potential customers. Brands can then offer these coupons as a call to action (CTA) in emails or after customers buy for the first time to improve retention. The coupon's expiration date can be aligned with a period when brands need to meet their sales target.
Display Discount Offers on the Homepage
Customers do not search for a discount coupon every time they visit a website. Therefore, businesses need to advertise the current discount offer in a banner on the homepage or through a pop-up. The following locations can be used to promote discounts to site visitors:
Exit Intent Light-Box: A discount coupon pop-up whenever someone is about to leave the site without buying an item.
Sticky Banner: Place the banner as a header or in a lightbox on the website. The banner can follow visitors as a reminder every time they scroll on the webpage.
Checkout Coupon: Offer a discount coupon at the checkout page to ensure customers do not abandon their carts.
Partner with Other Brands
Companies can partner with non-competitors to offer discount coupons to a bigger audience. This will also help improve brand visibility and gain new customers. When a person buys from a partnered brand, they will be issued a discount coupon. As a result, the customer will head to the company's site and buy products using the coupon. Customers who like the company's products will turn into frequent buyers.
Create Customised Discounts
The majority of businesses offer a wide range of products or services. However, the entire consumer base is not interested in every product displayed on the digital shelf. Therefore, it is unwise to offer discounts a customer cannot use. Businesses need to customise deals based on the target audience's specific characteristics.
For example, a clothing apparel store can create separate vouchers for male and female customers. This strategy will improve the customer-brand relationship by making the buyer feel special. As a result, they are more likely to return and shop again.
Advantages of Discount Marketing
A. Better Web Traffic
Sales advertisements have a high click-through rate, which is good for increasing web traffic. Companies can increase the click-to-open rate by 74% by sending promotional emails about flash sales. When companies obtain high site traffic, it improves brand visibility and helps gain convertible leads.
Discounts are very effective in increasing profits and transactions. According to statistics, flash sales can increase the transaction rate by 35%. Even if customers are coming to see discounted items, they will ultimately review full-price articles. Companies can clear out old stock this way and even sell new products.
C. Save Money through Cash Discounts
Offering a small discount to customers who pay through cash can help businesses save money. Banks charge a significant fee to process each transaction, so companies can avoid the transaction fee when customers pay through cash. They can also immediately access the amount, which takes at least a couple of weeks to reflect if a third party is involved in the transaction.
Discount marketing is one of the effective marketing strategies to increase brand engagement and visibility. It also helps generate new leads and convert them into long-term customers. Companies can offer coupons, limited-time discount offers, and flash sales to ensure customers do not leave the site without making a purchase. However, businesses should customise discounts according to the interest of their target audience. These strategies will increase conversion rate, web traffic, and sales profits.
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