Discount is a time-tested sales booster. But it can also cost you a lot, if you get it wrong. Sometimes, your brand may be at stake if you choose a wrong discount strategy to implement.
I handle support requests for WooCommerce Discount Rules, a very popular discount plugin for WooCommerce. Often, I come across store owners trying with crazy discount schemes and offers.
There is nothing wrong in making a crazy deal. But a vast majority of the store owners make quite a lot of mistakes when implementing a discount strategy. While a few understand the true meaning of discounts, a number of business owners treat the discount as a bait (yes, a bait).
So they set a number of conditions for discount eligibility, assuming that it will motivate customers to buy. The problem with “baiting” is that the customer ends up a prey. Trust me, no one likes to end up as a prey!
Recently, I was helping a store owner over live chat to implement a discount strategy for his WooCommerce online store. He asked me if we can implement the following discount scenario:
Customer has to buy X amount of quantity from Category A, Y number of products from Category B to get ONE cheapest product from Category C.
While he could very well do that with our plugin, I was curious to find out the ultimate goal of that discount strategy. So I asked him.
The answer is “I want the customer to buy more in order to get discount!!!!!”
I took a pause and explained him (over live chat) in detail with examples why his discount strategy is wrong.
When we finished the conversation, I thought of sharing it as it would be useful to other store owners.
Here we go!
Purpose of Discounts
The ultimate goal of providing discount is to increase sales and get more conversations. There is no doubt in that.
This very purpose will ruined when a customer finds it hard to understand the offer. How on earth a customer, whose average time on page is less than 1 minute, will understand a discount like this: “Buy 2 shoes, 4 socks and 3 tie to get a 50% discount on a Purple shirt”
Customers of 21st century are not that stupid. With emergence of smartphones, we are “scrolling” instead of browsing. If your offer does not catches his eye and registers in his mind within a few seconds, you have lost him.
Also, chances are huge that the customer may wrongly perceive the very intention of the promo itself.
So when you are creating a discount rule, you got to keep these factors in mind.
So how does the leaders of eCommerce business offer discounts?
What the world does?
You may have seen discount campaigns in most of the large online stores like Amazon, Alibaba or UDemy.
All of these online stores often give you a simple discount like 20% off on all products in the store or 30% off on all from Electronics categories.
Have you ever seen them running a campaign like this?
Buy 3 quantities of Product A, 2 of Product B, and then 1 of Product C, then you would get 10% on Product D.
The primary reason why these large online stores choose a simple discount promo is because the customers can understand them easily and make a quick buying decision.
Selling online is all about making the customer to click the buy button. Nothing else.
Research shows that an average customer spends less than 2 to 3 minutes in most ecommerce sites. Within that, you got to motivate the customer to make a quick buying decision.
If your online store fails in that area, then there is very little point in running a promo campaign (unless otherwise you have a customer base that could spend several minutes in your online store)
So what is a simple discount ? And what is not (a.k.a complex discount)?
Well, the term simplicity itself is subjective. But let us understand the difference between simple and complex promos using examples:
Here are some examples for simple discount campaigns.
- 15% discount on all products in the store
- Get 20% discount from Category A (or even B, C or D)
- All orders above $500 get 15% discount
- Wholesale customers get 40% discount on all products or specific categories
- Buy Adidas shoe and get 15% discount
- Buy One Product and Get One free (this could get complex easily if you add more “if’s and “but’s” )
Complex discount examples
- Buy 10 quantities of Product A and get discount in Product B, C or D
- Buy each 1 quantity of Product A, B, C and get discount in Product D
- Buy Product A at full price, get the second at 50% discount, third at 40% discount, 4th at 30% discount
- Buy any 3 quantities of Product A, B, C or D and get 10% discount. However no discount if customer purchases Product B and D.
There are a number of ways to make your discount rules complex.
While it is quite easy to configure and implement these complex discounts (thus saving a few bucks), it is quite difficult for the customers to understand these rules.
The huge disadvantage in running a complex discount is that:
It takes a considerable amount of time for the customer to understand this discount itself. We cannot expect all the customers to have a super fast brain to comprehend the meaning of your promo and take a buying decision.
Here are 3 huge mistakes to avoid while running a promo
Customers would get easily distracted if they see a complex discount promo in the site.
Instead of buying, they would naturally start hunting for more discount. Naturally, no body wants to give you an extra buck. That is what we ourselves do.
Most of us have the habit of searching the internet for best deals or coupons. That is why you find a number of deals and coupon websites. Its a human tendancy to get an extra discount.
2. Delaying the buying decision
When customers are distracted, they postpone the buying decision. They would try to understand your promo in order to save an extra buck rather than clicking the buy.
Simple campaigns like Buy Product A and Product B, get 20% discount would help you have more conversations than having a discount like “Buy A,B,C and get discount in D”
The later may sound like helping you to sell more products. But the customer is not that stupid. He would open up the calculator
3. Loss of Trust
This is the biggest, most dangerous outcome of offering complex discounts.
Some of the stores run too many promo campaigns at the same time. This is a bad practice for business in general.
There are chances that a customer will see one promo and purchase it. And if you show another promo at the same time and if that is giving a better discount, the customer will feel cheated. Your brand image will be on flames.
Besides, a discount actually means that you are intentionally lowering the value of a product.
Most people value something based on it’s price. By lowering the price through multiple discount campaigns, you haven’t done your job (effectively at least), if you haven’t demonstrated to your prospect that what you’re selling can truly add value to their life.
It’s saying that you don’t believe enough in what you’re selling that you think you can sell it for the standard price. You’re showing your cards, and proving that you have a weak hand
This will ultimately lead to a loss of trust in your products and the brand.
So how to do promos right ?
Just offer a simple to understand promo campaigns. Make simple discounts. Nothing more. Nothing less.
WooCommerce Discount Rules helps you create simple discount rules that help you sell more. (You can also create complex rules. But make that decision carefully.)
Feel free to share your thoughts in the comments!