Growing your Shopify store isn’t just about the number of sales, but also the revenue and profits you make. That’s why you need to consider alternatives to discounting, starting today.
Think about the last time you decided to make a purchase online. When you went looking for the product, you saw at least ten brands offering you similar items at different prices and discounts. As a consumer, that’s a win-win and you’re probably going to choose the deal that seems the best fit to you.
But as a business, continually over-extending yourself to offer the ‘best deal’ or the ‘best discount’ isn’t the most profitable strategy. You’re going to end up selling a product for much lower than what it took for you to buy it or manufacture it. And let’s not forget the costs involved in you marketing it!
This is why discounting is no longer the best eCommerce marketing strategy. It is of course a motivating factor for most consumers purchasing online, but there are other things that you can use to entice them into buying from you.
Alternatives to discounting that your Shopify store needs to try
1. Offer store credits
The very first strategy that we’ve seen take full effect in not just enticing new customers to the store, but also encouraging repeat sales, is offering store credits.
Store credit is a form of a document offered by an online store to a customer for taking a desired action on the website. This could be signing up for a customer account page, sharing the purchase, reviewing a product, reordering an item or making another purchase. It’s like offering an incentive that can be converted during the next purchase, making it even more appealing to the consumer.
If you have a Flits customer account page set up on your Shopify store, you can add store credits to it easily. This will help you achieve long-term success, just like it did for The Man Company. Read how The Man Company increased sales with Shopify store credits.
2. Offer product testers
One step behind offering freebies, that may or may not suit your budgets and profitability, is offering product testers. These are very small-size variations of your products that a consumer can use to see if they’d like the full packaging of the product.
Think of this as the testers you see at the brick-and-mortar stores. You can use items, see how they feel to you before you actually make the purchase of the product.
It’s also a great way to introduce your customers to newer products in your store. You just need to ensure that you let them know you’re sending across little testers that you think they will find a lot of value in. also make sure that your product tester packaging is as impressive as the full product for them to get a complete feel of it.
3. Create a product bundle
Instead of discounting a single product, create a package offer that includes two or more items from your store. Set a bundle price to let your shoppers feel how they get to save more by spending just a little more.
You can create themed packages to easily cross-sell products for different collections, introducing your shopper to more of what you offer. For example, if you sell candles and bath bombs, and the consumer is purchasing only bath salts, create a bundle called ‘bath care’ that gives them all.
Instead of discounting, you just increased your average order value too!
4. Offer value-shipping
Another thing that you can do to offer value to your customers and entice them into making a purchase is offering shipping-related perks. There are a few ways to do this based on your contracts with the logistics partners and what might fit right into your overall budgets. Here are a few ideas:
- Offer free shipping
- Give discounted shipping
- Free expedited shipping (one-day or two-day deliveries)
5. Educate your customers about the value you offer
How is this even equivalent to the effect a discount can have?
Think about this. You’re spending hours, days, weeks, months, or even years getting the best of products to sell on your store. If you could tell them how you’re ensuring the quality or the benefits of your products, consumers would stop seeking discounts to make that purchase.
It’s all about making your product look indispensable. And you can do that with content marketing. All you need to do is create how-to videos, share customer testimonials and stories, or give a glimpse of the BTS of the product making.
Why should you stop running discounts on your products?
Now you might be thinking that implementing discount codes is so much easier. And well, everyone else seems to be doing it too!
So why should you actively start thinking about offering your customers anything other than discounts?
We’ll give you a few reasons:
1. Discounts devalue your brand
By running sales frequently or offering discounts, you’re in a way communicating that your product isn’t worth the price you asked for initially. It results in the consumer wondering why you’re offering a discount on the product – was it meant to be at a lower price always? Is the quality not good enough? Is it even going to be worth the new discounted price or can they get it for lower?
These doubts result in your brand losing value in the eyes of the customer.
2. Discounts make consumers “wait until the next sale”
Consumers are smart. If they start to feel that they can get your high-value products at a much lower cost during a discount or sale, they’ll wait it out. Seasons or trends don’t matter to them as much as you think, as long as they can get a good deal.
While the consumer might still make the purchase from you when the products go up on sale, you’re losing out in two ways. One, you’re making the sale at a much lower price that impacts your overall revenue. Two, you’re giving them enough time to look for another brand to buy from while waiting for your sale to go live.
3. Your regular pricing sounds like a scam
Imagine a brand is always running a sale or offering a 50% discount on their products. Then one fine day, they decide to sell the same products at full-price. What do you think the consumer’s reaction would be?
Well, they’re going to believe your full-price is a scam. They’re going to think that now that the product is in demand, you’re simply increasing the price! That’s a very negative impression to have on consumers.
4. Your loyal/ repeat customers will feel frustrated
Imagine buying a product at $100 and then seeing that the brand is offering it for less than half the price to entice new customers, just a week from when you made the purchase. What’s the first thought that comes to your mind?
Regret. And then comes how the brand is so frustrating to not have let you know about the discount any earlier.
In most cases, you’re never going to go back to that online store.
5. You’ll barely breakeven
A lower price or a big discount might result in you making a lot of sales. But imagine the discount as the amount you need to reduce from the overall revenue you make and the profits you get on the sales.
If you’re running too many discounts or too big ones, you’re barely going to be able to breakeven between your product’s buying and selling price. Over time, you’re going to feel the burn in the resources available to you to run the business.
Discounts or no discounts – Should you be looking at alternatives to discounting?
We’re not saying that discounts don’t work and that you should ditch that eCommerce marketing strategy altogether.
But in times when the competition is stiff, your profitability can drop before you even realise it. This is why you need to start exploring the alternatives to discounting.
One of the most time-tested tactics that has worked as an effective replacement for discounts, is store credits. And we want to help you enable that strategy in minutes!