93% of US consumers cite “discounts and offers” as important factors in their purchase decisions. In a report by Inmar Intelligence, 80% of consumers said that a discount coupon changed their behavior in some way:
- 37% made a purchase sooner than they would have
- 35% bought from a brand that they would not otherwise have purchased from
- 35% bought more than they would have otherwise
For retailers, coupons and discounts are a tried-and-tested way of attracting new customers, boosting sales and clearing inventory. For consumers, it’s an opportunity to save money, feel valued and explore new brands and products.
Using advanced capabilities built into modern retail and point of sale (POS) systems, retailers can select the kind of offer and promotion that suits their specific business needs, and appeal to customers in different ways. More than three in four consumers say they are willing to wait for a deal before making a purchase, according to Juniper Research. It pays to get your offer right.
Here are some ideas on how you can design a promotion strategy to achieve your business goals.
Goal 1: Attract new customers
Flash sale promotions are a sure-fire way of creating a buzz around your brand and getting the attention of consumers who may not have bought from you before. Substantially reducing the price of an item for a very limited period creates a sense of urgency that encourages consumers to buy impulsively. It serves as a hook for attracting new customers, getting them into your online or physical store and compelling them to buy other products from you in the same transaction.
How to make it happen:
A sophisticated retail management system like LS Central enables you to sell items on a promotional price in a set period with no manual intervention required. The promotion can be a discount of the retail price or a fixed price for the item. You set the offer in the system, centrally, and then decide whether the discounted price should be applied to all your stores or only some, under which conditions, and for which period of time. And you can even set more parameters: perhaps you want the customer to spend a certain amount to qualify for the reduced-price item. Or maybe you want to run several different promotions on different days. Whichever your strategy, you can set everything up ahead of time, and let the system automatically apply the offer according to your settings.
Goal 2: Reward existing customers
Repeat customers are one of your business’s biggest assets. Research shows that not only are they nine times more likely than a new customer to shop with you again, they will spend more too. Indeed, a study by Adobe found that repeat customers yield up to seven times higher revenue per visit than regular shoppers.
Rewarding your repeat customers with vouchers and coupons and tying them in with loyalty programs, then, is a great way of encouraging them to stay loyal and spend even more with you. See it as an effective long-term marketing strategy. You can also make use of targeted discounts to recover customers who’ve abandoned their carts. Last year, around 70% of online carts were abandoned before checking out, according to the Baymard Institute. Sending these people a 10% discount code may just give them the nudge they need to commit to a purchase.
How to make it happen:
Set up a targeted discount offers in LS Central, and the correct discount will automatically be applied at checkout when certain criteria are met. For example, a customer earns enough loyalty points to qualify for a personal discount code, offering them 20% off your new season clothing line. In LS Central you can specify that only new season items in their basket should have the discount applied, even if other items from your range have been added. Again, you can create an unlimited amount of separate discount offers and set specific rules for each one, including different validation periods and retail categories.
Goal 3: Boost sales of a specific item or category
Mix-and-match deals are an ideal way of boosting the sale of certain products that only have a limited selling window or will perish fast, such as Easter eggs, summer essentials, and fresh fruit and vegetables. By bundling products together with a special deal, the customer ends up buying more of what you want to sell and they feel like they’re getting what they want for a better price. Supermarkets regularly use this approach to move items fast.
How to make it happen:
You can apply the mix & match offer in LS Central and set which products you want to combine to qualify for a deal, such as three for two, or $10 off when a certain number of items are bought together. The POS automatically detects when a combination of items are bought together and triggers the appropriate discount. Because LS Central supports a large variety of options, you can set up the right offers for specific sales goal across different product categories.
Goal 4: Clear stock to make way for new products
Similar to mix-and-match deals, multibuys enable you to reduce your inventory by selling products in bulk to shoppers, incentivized by lower prices. The more they buy, the more they save, and the less deadstock you have sat in your warehouses. When properly implemented, volume discounts can help you sell more and turn over a greater profit.
How to make it happen:
Select the multibuy option in LS Central and apply it to the products you want to shift. The system applies automatic discounts according to the quantity of items sold, allowing you to apply a variety of levels and discounts for each set quantity. When a flagged multibuy item is sold, the system triggers the multibuy offer and will apply the correct discount for the number of items in the basket. For example, if you sell three cans of tomatoes, the price per could go down by €0.10, if you sell five cans, the individual price could go down by €0.20.
Using discounts and promotions to your advantage
Retailers that use discounts and promotions in the right way can boost sales without damaging profit and increase customer loyalty without lowering perceived value.
Key to success is having robust technology in place that supports you to handle many different types of promotions at the same time, and delivers data-driven insights to ensure your strategies are working in the way you intended without giving away more than you need to.
With LS Central, you can set up as many promotions, discounts, mix and match, and multibuy offers you need to suit your business goals and maximize profit. The system delivers all the in-built functionality you need to set prices, easily change them and run different promotion campaigns within set parameters. All that’s left is for you to try out different combinations and work out which deals best suit your business and customers.
Need help with finding retail technology that suits your needs? Contact us and we’d be happy to guide you in the right direction.
