When To Use Customer Discounts to Boost Sales – Episode #25

by Richard Wilson on June 5, 2011

In this episode Richard discusses the topic of discounting and how to use discounts to make more sales without building your brand around being cheap and discounted.  This is an important concept to understand if you want to run a profitable business over the long-term.  (Download in MP4 Format)

Video Transcript/Summary: There are many ways to get customers to buy without giving them a discount. That means that you should do everything possible to add value to the client before you offer a discount to make a sale. Here are a list of things that you can provide to clients who are price or value sensitive that can take the place of a discount:

  • Bonus materials or features typically reserved for more premium packages
  • Extra warranty periods
  • Bulk discounts
  • Additional services or updates to the product

Also, if you price your products and services 20-30% higher than your competitors you will have higher profit margins and you can afford to spend more on marketing than others. The other advantage of this position in the marketplace is that you can do short-term promotions or custom discounts for a few customers while still keeping your prices relatively high. For example if you charge $1,200 for your product and your competition charges $1,000 you can give a $180 discount yet still make more than your competitor.  People like to feel like they are getting a real deal, they like to win at negotiating discounts.

Thanks for joining us, see you next time!

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