We all know the famous expression “it’s cheaper to retain a customer than to acquire a customer”.
Keeping a customer satisfied is far easier and cheaper than winning over his trust.
Sometimes when we need to get our business started we need that little incentive that captures the interest of our audience and allows us to get that client in the door.
Maybe we don’t even have to make a sale, we’d be happy to achieve product trial, or in other words, get the customer to experience our product and make his\her own decision.
This may be not simple to do, especially if we’re competing in a noisy and competitive industry. Like fashion maybe.
To discuss different strategies that can apply to get your products noticed, in other posts in our blog, we’ve explored at length the concept of the customer journey.
This framework allows us to chart the path that can take a customer through the awareness, consideration, and purchase stages of his or her shopping journey.
At the end of the journey, however, we can see that there is often still a “last mile” to run to get your prospective customer through checkout.
At this very last stage you may need a little extra incentive, something like a sales promotion.
In this post, we’re going to review 5 different sales promotions you could use to get your client to purchase.
With no further ado, let’s look into each sales promotion strategy!
#1 Price Discounts
The most traditional form of sales promotion is through price discounts.
Inevitably, price-sensitive customers can be very influenced by the cost of a product. This is why a free trial can be a good way to go, to win over your first clients.
Pricing strategies like “penetration pricing” are an approach whereby a new brand approaches a competitive market by charging less than the competition in order to develop its market share.
It is important to take into account how a low price can spoil your customers. If on the one hand, an inexpensive product can be an irresistible opportunity, on the other you are giving up your profit margins, and that’s not great.
This is why discounts usually have limited time effectiveness so that a good balance can be found between creating a sense of urgency and not diluting or devaluing your brand.
If you’re interested in learning more about pricing strategies, especially as you approach new markets, in this post we explore the topic in more depth.
A coupon is essentially a voucher or even a simple code that is used to allow a potential customer to get a product or a special deal.
A coupon will still act as a discount but it will help you connect two distinct promotional initiatives. Maybe advertising in a newspaper and a promotion in-store. By having customers collect a token from a magazine, you could offer them a special deal.
By having customers use coupons you’re able to tie together two separate brand touchpoints and customer interactions.
In a digital customer journey, you could have customers enroll in a newsletter so that you can provide them with discounts later.
A coupon essentially allows you to optimize your conversion funnel by offering a great offer to those customers who show engagement with your brand.
Samples may not apply to every industry, but they do provide an opportunity to get your customer to experience the product before committing to buy.
This does not mean that you may have to give out free food at a supermarket aisle but instead that you may have to create a riskless offer that is just too enticing to be refused.
In the context of software, for instance, the 30-day-money-back trail is almost an industry standard, as Saas subscription services, do require a little bit of getting used to for new customers to test the capabilities of new programs.
All in all, the idea, it that of bypassing your customer’s rational brain, with a stimulus that is not simply intellectual but almost emotional.
Gifts are a great way to spend your marketing budget in a very practical, and customer-attractive manner.
With gifts, you are investing in celebrating a relationship with your customers even before they have made the decision to become one.
Gifts can be really persuasive tools to get customers feeling like they have gained something for free and that could return the “debt” towards your company by making a purchase.
To this extent, gifts help in affecting our customer’s internal accounting system and getting them to perceive an impulse buy, something that not only makes sense but which is actually the right thing to do, in order to return some of the value acquired at no cost.
Competitions are strong incentives to enter a riskless offer (such as a mailing list or a loyalty card program) in the off chance that by doing something small, a huge gain can be made.
Competitions have become a really popular approach to ignite profitable customer behavior as through competitions a lot of value can be drawn in more than one department.
First and foremost, by proving an opportunity to win a valuable reward, customers are incentivized in building loyalty towards the brand as more “lottery tickets” equals more chances to win.
Moreover, companies can use different types of user-generated content that customers may create as part of a competition to acquire content that can be shared on social media.
Now that we’ve discussed all 5 sales promotions, we can move towards our conclusive remarks.
There you have it! In this post, we’ve looked into 5 different types of sales promotions your brand can use to lead customers through the last mile of their customer journey.
Having them in the store, or browsing online is not enough to make a sale. Sometimes we need that extra incentive to close the deal.
This is why using these simple in-store promotions can really impact your revenue and your profits.
Did you know that when a customer commits to a purchase he\she is also very likely to buy more than one product?
To scale your business, you need to make sure you’re using this window of opportunity effectively and put in place all the relevant upselling strategies.
If you’d like to learn more on how to apply the right upselling strategies in this post, we list our top 7 upselling tips, that can get your average sales up.
If you’re interested in retail and sales, don’t hesitate to look at our blog, where we’ve got a wealth of articles and information on how to optimize your store and increase your profits. Enjoy!