If you want conversions without discounting your brand, read this.
Marketing professionals and business owners know the pressure to get sales. AKA: Make it rain! It’s the life-blood of business. I create email strategies, but part of that almost always leads to offer analysis (price & product presentation basically).
The problem every business runs up against…..
Price everything at 25-40% off and the sales come rolling in. Soon customers get used to discounts and think they have to run them all the time! You start what Seth Godin called “the race to the bottom” and… if you’re not careful it can kill a business. There’s always someone willing to sell for less than you and that’s not a fight you want to win.
A marketing ‘expert’ came in and told a pet store client once: “Let’s kill the discounts! Death to coupons and special offers. Sure it’ll kill sales for a few weeks, but we’re a premium brand! Coupons make you look bad!”
I’m “premium” though! Ferrari doesn’t offer deals!
Their business model focused on handmade units, they only WANT to sell a small number of sales per year! Do you?
They also make big money on licensing their logo on clothing, laptops, RC cars, model kits etc. They have no intention of scaling or selling 10,000 vehicles or more.
Many premium household brands do go on sale at your local supermarket.
The real shocker? The brands are running the promos. The brand controls the price! They have to – or some retailers would sell at cost just to under cut other local retailers (Walmart tried this for years).
Price must be controlled by manufacturers/brands.
So yes, premium/high end products DO go on sale. Granted, not at 35-60% off or more, but they have sales.
Examples:
Tom’s Shoes offers “One for One” as their hook. You purchase a pair of shoes and someone else (who doesn’t have ANY) is getting some.
Gillette Razors state “The Best a Man Can Get” and basically call out their audience (Men) and their position “We’re premium”.
So, how do I use discounts wisely?
You should to have a sale now and then. What you must never do is discount to fire-sale pricing without a VERY good reason for it.
Usually 10-30% off is within reason 40-50% off discontinued, refurbished or reconditioned items is reasonable – there’s no way a premium brand sells anything at 70% off unless they’re going out of business.
They’d rather burn the stuff! (Nike, H&M and others incinerate unsold product all the time)
What you want to do is rotate your BIG discounts so they are pretty rare (twice a year) that your whole store is on sale.
Examples of good promotion strategies (used sparingly and not always on the entire store)
Normal rotation looks like this:
Big sales (Quarterly)
Small sales (1-2x per week)
Single-product sales (Daily or weekly)
Medium sales on every 2nd or 3rd weekend.
Big Sales:
- Buy 2 Get 1 Free
- BOGO
- $25 in future store credit on orders of $100 or more ($50 on $250 etc)
- 20-30% off a category, product or kit
- Free gift with every purchase
- Free shipping over $40
- 2 Day shipping
- $5, $10 and $15 items (or other prices)
- Up to $25 off
- Limited selection (last year’s stock, limited run)
Medium/Small Sales:
- 10-15% off single items or categories
- Free small gift
- $1 or $2 off retail
- Faster shipping
How much is TOO cheap though? I need to know!
Yes, you do need to know. To answer that you’re going to have to do some research. Amazon is NOT the only place you should explore but if you don’t have a lot of time it’s a great starting place.
Just remember that people don’t mind paying a little shipping to get something, so don’t always factor the big and amazing Prime aspect into your approach.
One way you can get some quick answers to the average price in your space is by using an Amazon Research tool that scrapes the top competitor pricing.
There’s a Chrome extension (Pictured) that does this automatically (Free trial lets you collect 100 product details).
There’s a more complicated approach for extracting to Excel file, too.
Hey! Why not just inflate the prices?
You should price with enough margin that you have room to offer specials. Pricing strategy is a topic worthy of an entirely separate book or article.
You can even be the highest priced if your product is worthy of it – meaning it’s better than others like it and you can prove it. Perhaps your the only one like it!
If your thinking of using an inflated price to justify everything always being on sale… stop. People aren’t stupid. That becomes your regular retail price and defeats the purpose. It also degrades your brand perception.
It’s basically amateur hour.
Those margins got room for scale?
When locking in your prices, you’ll want to consider making room in your margin for affiliate commissions, wholesale and the odd special.
Affiliates won’t usually promote for 5% unless your big ticket or hard to get. So aim for at least 20-30% (and still profitable). You may wish to leave room within these for low volume affiliates to get 20% and higher “super affiliates” to get 30%.
Exceptions to margin norms
Truth is, some products are known in the industry to have low margins. Things like power tools, some foods, technology etc.
Sometimes 5% off is a great deal!
Look at competing or similar markets and aim to be similar. Don’t think short term sales and be “the very lowest”.
Nobody wants to be the cheapest and it’s a race to the bottom and you’ll find yourself in bankruptcy.
If you can’t discount, you need a good Hook.
A solid “why should I care?” Or “why is this relevant now, and what’s in it for me?!”
Hooks create curiosity and tease they have something you know you want or need.
A solid hook is NOT “Love yourself this Valentines day” Nobody’s buying because of that.
That cheesy stuff is what junior marketing people are taught, but it doesn’t fly with real consumers. Neither does “care about what goes in your body”.
What you need is a hook/angle that invokes curiosity OR tells a benefit filled story that makes someone THINK you have answers they seek.
TIP: Many people hear the word benefits and think it means features like “8 hour battery life”. That’s not a benefit. A benefit is “lasts an entire business day”.
If you’re not sure if something is a REAL benefit people will care about…
Ask yourself “What’s in it for them? What does that mean? What does it DO for them that they couldn’t do before?” The answer to those will get you closer to the real benefit.
Hook examples (just a few simple ones):
- Why they stole Einstein’s brain
- The leg cramp that ended my running career
- Stress gets stored in our DNA
- Your Immunity is being attacked this year
It can take copywriters years to have a natural ability to nail hooks. Some marketers call them angles, leads or the big idea. It’s all the same thing. It’s basically a single statement that gets the attention, interest and sometimes even the desire of a prospect to want to know more.
Good hooks get interest but great hooks can create desire. Power tip – you can’t actually create desire. It has to already exist. Diaper companies didn’t create pooping babies. The problem already existed and the consumer already had a need. All they had to do was create a more convenient solution.
The hook (even without discount) can create a boost in sales. Yep, retail rates without any special pricing or bundles.
Great Email Hooks
Coming up with great angles requires being able to see the world through the customer’s eyes (copywriting exercise)
I’ve found these ideas over the years by reading blogs written by amazing people, reading the news, looking at magazine article headlines and reviewing copy swipe files.
- The promise – This is the most common kind. You promise to solve some big problem the customer has, or offer some big benefit they’ve always wanted.
- The problem – Most motivations for anything start with a problem. Even art solves a problem, so it doesn’t have to be a big ugly problem – but it might be to the prospect.
- A big secret – There’s plenty of things out there that aren’t THAT big of a secret but to the average person aren’t known. It’s fun to tease this secret and reveal it near the bottom of the email and keep them captivated (or even better, reveal it on the lander/prod page.
- A juicy story – These are harder to write, but they put the reader’s mind on autopilot while they go on a journey with you.
- Incredible statement – Announcing something like “The end of vacations as we knew them” can set a crazy stage for an email.
- Knock our own product – This is where we reveal one small flaw that isn’t that big of a deal, or reveal our previous skepticism about the product before we learned more.
- Epiphany bridge – Where you describe the journey from your previous knowledge to your current.
- Teach you something – My favorite angle because there’s often something the average consumer doesn’t know – and throw to an offer.
- Straight value – Where you don’t aim to sell anything and just focus on genine tips, advice, recipes or information that would be super valuable for no cost at all.
Example:
Flyer Style Emails
I know some stores aren’t suited to long copy or even mildly short copy… but with some stores the flyer style has really worked well.
Split testing revealed the “email only” buttons, having a clearance section (not all the time) and having a new arrivals section has really boosted sales.
They still do single product focus now and then, but the store has over 200 items… so flyers make sense.
Still, watch for the short copy used:
Much of it is benefit based:
- 20% off 50+ Top Brands (IE: not unbranded/knock off)
- Low to $7.99 (meant to be low AS $7.99) – Curiosity is going to make someone wonder what type of types of items are only eight bucks.
- Limit two boxes per person (scarcity)
- Local warehouse – 1 week delivery
- New Arrival Channel – “Stop to explore the new”
- Unbeatable deal – 7 days only
Here’s the Point of This Entire Article:
If you’ve got a mediocre hook or price?
You’ll have mediocre sales. It’s that simple.
