Who doesn’t love a good discount? It’s an opportunity to save a few bucks on your favorite products and services. Many consumers even wait for upcoming sales before purchasing something.
Companies will frequently offer discounts to draw in new clients and customers. The hope is that you sell enough to make the discount worthwhile.
With that said, there are downsides to discounts that you want to pay attention to. Not every business could benefit from a sale as significantly as others.
Before jumping on the discount train, weigh the pros and cons provided below from Global Resources Reviews, and see if it is worth it for your company.
Pro: Attract New Customers and Clients
The biggest pro that many see from a sale is the ability to draw in new customers and clients. They’re usually highly effective for this reason.
Very few people will say they would rather purchase something at full price and will wait for the sale to finish.
Con: The Type of Client Attracted
As excellent as it is to draw in new people, are they the types that you want for your business? This isn’t to say that the sale is going after the wrong target audience. Instead, are the discounts bringing in people simply because of the bargain and not because of the company?
You want to gain loyal customers that will support your business during and after a sale.
Pro: Quick Increase in Sales
If you keep track of your finances, you’ll likely see a boost in sales when offering discounts. So, if you’re low on cash for the month, a flash sale could give you the help you need to finish the month off strong.
Con: Expectation for Future Sales
The frequency of sales is something to watch for. Too many of them and your customers will become so used to it that they’ll wait for the next one. If you’re going to run sales, it’s best to keep track of how many you do and how often.
Pro: Rewarding Loyal Customers
It’s a good business practice to reward loyal customers. These are the ones that stick with you, whether there’s a discount or not. They support you in many ways, and realistically, without them, your company may not be as successful as it is.
You can set up a sale or discount in a way that is rewarding to your long-term clients and customers. Not only will that keep them happy and more inclined to support you, but it also can draw in new long-term customers as well.
Con: Perceived Lower Value
Have you ever seen those Facebook ads where there’s a sale on a course that’s usually thousands of dollars, and for a short period, it’s available for $50? If you look at the comments, you’ll likely see many users questioning the value behind it if they’re offering it for so cheap. Not only that, many question the mark up if the company is willing to slash the prices that drastically.
You want your sale to draw in new customers, not have them question the value of what you’re offering.
As you can see, for every pro of a discount, there’s likely a con and vice versa. Offering them comes down to your preference and if it’s good for the business.
It’s best to keep track of a sale. See if you gained any new clients and customers and if you saw a boost in sales. That will help you dictate if you do another one