Should Your Business Offer Discounts?
With increasing competition in the marketplace, businesses feel compelled to offer discounts in order to entice customers. However, the tactic of using discounts as a “quick-fix” can be unsustainable, or even harmful to your business.
Dark Side of Discounts
Some of the disadvantages of poorly strategized discounts include reducing the perceived value of your product and creating unsustainable customer expectations about your pricing. The most common disadvantage and greatest concern to your business is that discounts can erode your profit margins.
The good news is that all these scenarios can easily be avoided. Data driven decisions should be the primary factor in choosing when and what to discount. With the wealth of reporting data created by Revel Systems point of sale, merchants have a global view of their business at their fingertips.
Data Driven Discounts
With sales and transaction insights gained from the Hourly Sales report, it’s possible to identify optimal timing for a promotion to help eliminate dips in profitability. Data insights can also help merchants identify which items are experiencing softer sales and might see better movement with optimized pricing.
Design your Point of Sale to offer discounts based off of volume, Happy Hours, or customer groups.
Volume Based Discounts
Customers who were considering a purchase are incentivized to buy when they’re rewarded with more than they initially expected. With Revel, business owners can maximize volume based discounts and meet specific goals by setting detailed parameters (e.g., buy any pair of pants, get 30% off any t-shirt).
Customer Specific Discounts
With the emergence of easy to use Customer Relationship Management (CRM) for SMBs, owners are learning the power of managing customer information and leveraging it to offer incentives to their most valuable patrons. The two most common forms are discounts for particular customer groups and loyalty programs.
Happy Hour Discounts
With Revel, you can easily group products to be discounted by the same amount across the board (e.g., all beers $2 off) or program alternative prices for individual items during a given window.
Gift With Purchase
Our latest feature, gift with purchase, enables businesses to give away a gift with a specified purchase. You select the gift and criteria for purchase. Say, create a promo that for every $40 spent, your customer gets a free umbrella. As soon as a customer spends $40+ at the POS, a “Gift With Purchase” prompt will pop up, and then you have the choice to select the gift.
By leveraging your data, you can strategically use discounts to target a certain customer group, increase traffic during slow business, or free up inventory. Ultimately, discounts will help you drive traffic and increase sales, ensuring that you have a competitive edge over your competitors.
Learn more about our latest feature, Gift With Purchase, below!