How Not To Lower Your Price This Holiday Season

This holiday season, everyone is looking for a bargain.  Or at least it seems like discounts are driving the economic train.  From a marketing perspective, nothing is more frightening than an endless loop of discounting.  Take stores like Bed, Bath, & Beyond.  Chances are that you’ve been hit with more than one of their 20% discount coupons.  What if all the coupons were to stop?  You might consider going to their competition.  This is largely because you’ve been conditioned to shop at that store using a coupon.

What’s the alternative?

I’m often asked, “What is the alternative to discounting?”  I think the more important question is, “How can I create more value?”  By creating more value for your prospects, and ultimately your customers, price becomes less significant.  For example, let’s take store A.  Store A is offering a 20% discount on a towel set.  These towels are available at just about any kitchen or bath store and even the big box retailers.  Store B decides they want to move quantities of the towel set as well.  But instead of discounting, they bring in an interior decorator to give a free “color match” seminar titled, “How to choose the right towels that make your home look like an expensive spa retreat!”

Assuming that Store A and Store B spend the same on advertising to promote their offers, store B will likely attract a similar quantity of prospects and may even have a higher percentage of sales.  Regardless, they are building a pattern of value versus a pattern of consistent discounting.  The endless loop of discounting is just that, endless – reducing margins and increasing prices.  Very few retailers or online service providers can sustain the discounting tactic. 

Think of ways to provide value to your audience.  Yes, some people are solely motivated by a discount, but these aren’t the types of customers you truly want.  Customers who see the value in what you’re offering and are willing to buy without added motivation become loyal repeat purchasers and advocates for your product, service, or store.  Get creative, experiment with new and different ways to create value for your customers.  The result will be long term customers who help you grow your business.