A large number of modern products find their consumers thanks to the efforts of marketers. Advertising is a centuries old experience, it is difficult to establish the exact date of its appearance. However, marketing began to take shape at the end of the 19th century in connection with industrialization and the development of production in most developed countries. Pricing strategies are an integral part of it, and discounts are included in them. Such methods of increasing sales are almost the oldest and arose almost along with the advent of trade. A discount is the simplest way to advertise a product.
In simple terms
A discount is a reduction in the price of a product, service or work, but as a rule, while maintaining profitability or to reach zero (loss minimization). It is used to stimulate demand and increase sales. Often, discounts are advertised in advertisements for a product or, for example, a grocery store. As a rule, they can be installed and removed several times a day, and in fact are price changes in both directions. Very often, such discounts are used in grocery stores to stimulate demand at different times of the day or days of the week. From an accounting point of view, thisdoes not affect its maintenance, as a rule, only the purchase price is fixed, as well as the profit received. In general, discount promotions are all around us, such as discounts in supermarkets or cafes.
Pricing
If you go deeper into marketing, there are many different pricing strategies. The following will list those that are directly related to discounts:
- Sliding, falling price - a gradual decrease in the price of a product, to cover a larger market share, allows you to get additional profit after making the main sales
- Preferential price in relation to competitors is a good way to win customers or attract new customers. It is necessary to optimize costs in such a way that the price is lower than that of other firms
- Affiliate price differentiation is a great way to get more profit by raising the price of a related product and lowering the main one, for example, discounts on toothbrushes are offset by expensive toothpaste.
Practical Tips
The most primitive, but, nevertheless, effective way is to set an unreasonably high price on the main price tag and then lower it with the word "discount". This is very common in many department stores, consumer electronics stores and supermarkets. It can also work in a small store, but subject to high traffic and a large flow of customers.
Discount percentage. In general, he may beany, depending on the original price. No one forbids making a reduction of both 1% and 99%, which, by the way, will attract a lot of attention and can turn out to be a good advertising campaign, but this must be done wisely, as this may scare off consumers. The most common options are 10-25%, you will often find such discounts in supermarkets.
In general, it is better not to write the discount as a percentage, as this makes it difficult for the buyer to calculate the price and turns the trip to the store into solving mathematical problems. And your customers will not like this very much. In this case, you should at least write the difference that the buyer will save.
Rounding prices. Numbers matter, especially when it comes to discounts. Buyers respond better when the seller sets the exact price of the product, for example, 793 rubles 35 kopecks than 794 or 792. In the latter case, the amount is less. However, in a situation with more precise amounts, the consumer gets the feeling that the seller is more carefully analyzing the costs and expenses associated with the production or sale of goods.
Another method is nines. Works great with expensive products such as consumer electronics. A TV worth 10,000 is more likely to be bought for 9.999. At the same time, its purchase price can be 7,000, and the initial price before the discount is 14,000. The buyer perceives the first digits in the cost more easily, and a feeling of savings is created, and if you raise the initial price, the product will go even faster.
Discount on the brink of profitability, to zero and even minus. What for? Such a discount is a great way to free up a warehouse orshelves for other goods. This happens, and quite often, especially with manufacturers of goods, and not with stores. For the consumer, this is a great way to buy what you need cheaper, and for the seller, it is an equally wonderful way to get rid of excess products, reducing or even covering possible losses.
Discount Coupons
Can be separated into a separate group, since this is not just a price reduction, but a whole advertising campaign. This method is a great way to bring in additional customers. There are entire services that sell coupons, they make a profit for selling discounts. As a result, the buyer can receive the goods for half of its cost. However, along with one buyer, many others are likely to come. In addition, a rare customer does not like to receive a coupon for which a discount is provided. This increases sales and consumer loy alty.
