Everyday we, I am bombarded by special discount deals. First, it was 10% off. Then it was 20%, no 25% off. Then it was early bird specials to get 50% off or sales during select store hours. Then there are the coupon monsters Groupon and the like. One sees special offers online as well as offline. Some online promotions are more engaging than the boring XX% off gig, but it is still a bloody S P E C I A L D E A L! Specials go on and on and on to the point where there is nothing Special about Special. How can there be? Everyone is doing the same old thing?
As a marketer, what I find so interesting about this discount mania among retailers of all shapes and sizes, is:
a) results of the specific special discount is rarely tracked so retailers don’t know which or if any of their ‘specials’ worked
b) there is this ingrained believe that the only reason customers come through the doors is to get a deal so why not offer them what they want
c) since competitors are offering ‘specials’, they have to as well in order to be, well, competitive.
So what is so wrong about offering a deal?
Nothing. As along as a discounted price is not the only incentive you offer your customers. Nothing, as long as there are better reasons during non-deal times to come into your store.
Don’t get me wrong. I’m not saying that a retailer should never have a sale. I’m just asking why the discount addiction? Don’t you have faith in your merchandise? Don’t you believe customers really love what you have to offer them? Haven’t you added value when your customers do walk through the door? If you don’t or haven’t then you may want to rethink why you are in business at all. If you’re going to be giving away a fourth or a half of your profit in order to make a sale, I don’t think you’re going to last very long.
Here are the three major downsides to the special deal habit.
- Specials train your customers to only visit/purchase when you have a sale turning your customers into discount junkies.
- Discount deals may move merchandise, but do nothing to build a loyal customer following
- They diminish the value of your brand, your product, your service.
Why would any retailer do this? Isn’t business tough enough without making it harder still?
So, how does one get out of the boring Special rut?
Let’s start with the basic premise that not all are discount mavens. There is the impulse buyer and the “I made a good investment” buyer. There are the weekend shoppers, the stroller crowd during the week. There are even those who have shopping phobias. They want to get in and out with whatever they need and they don’t really care if there is a special deal or not. In fact, this group would prefer you to bring the merchandise to their home and would be happy to pay you to do so. Most recently, there is the shopper who searches high and low to purchase items that support their ‘green’ or ‘sustainable’ beliefs.
So which shopper are you targeting with your special deal? Any of them?
Stop thinking discount and start thinking promotion. Promotions when done properly are more engaging and stand out from the discount deal chaos. By smart promotions I am not talking about having customers whisper a password into your clerks ear so she can receive a discount. No, I’m talking about promotions that Set you apart from your competitors. As an example, instead of boring discounts why not give that 10% in ‘contributions’ to local community causes. This way you feel good and you help your customers feel good by doing something of value to the community. If you have to give some of your profits away, make certain it goes to a good cause. There are also stand out promotions that can add value and create excitement. Think of joining forces with some other local area retailers (non-competitive) and offer a complete package. A women clothing store could run a make-over promotion that includes an outfit along with a salon visit for hair, make-up and nails. Throw in a massage and you’ve got a promotion worth talking about.
Do you see how these promotions are so much more than dead-end, boring discounts?
Stop mimicking your competitors. Rather than following your competitors down the road of boring dead-end deals, why not carve your own path and let them follow your example. Wouldn’t that be better for your customers, for your store and for your bottom line?
Share some of your promotional ideas for your retail store with others. Post them below.
- Stop wasting time reading shopper strategy analyses! (bizcommunicator.wordpress.com)
- Why your size is totally irrelevant, and what people are doing about it (thestar.com)
- Supermarket offers: Not so special (economist.com)