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Promotions: Mark down, Bundle, Offer Freebies

Introduction

Offering a promotion can improve e-commerce sales.

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In fact, it's usually an essential part of the marketing process. However, it's also essential to understand what kind of an offer you use and how your customers, potential or returning, will react to them. A good promotion used correctly can increase sales AND increase loyalty to your brand. Promotions should accomplish four things:

 

  • Drive strategic innovation
  • Improve a brand’s image
  • Make customers satisfied and invested in the brand
  • Focus on creating long-term sales and profits

 

Simply repeating prior promotions does not guarantee success. E-commerce marketers need to regularly revise their promotion strategy as factors change. Here are examples of promotions that have proven effective at increasing e-commerce sales:

 

  1. Marking Down Prices

The most common promotion: a temporary reduction of a price. When pricing down, and when setting prices in general, a good rule to follow is to have ‘9’ at the end of the number. An item priced at $3.99 would be perceived to be much better value than if were priced at $4.00.

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Caution should be taken when deciding to mark down your prices. Increased sales can come with:

  • A perceived lower value of your products.
  • Customers who recently paid full price feeling cheated.
  • Customers who will only buy at promotional prices.

 

  1. Bundling

Making groups of your products (“bundling”) at a price lower than the sum of their individual prices is a proven way to increase sales. A better combined price with a perception of improved value is a great way to convince customers that they feel they are getting a great deal and have more control over their purchases.

 

  1. Offer Something for Free

If at all possible working something free into some part of your offering can be of great benefit. It is easier to motivate consumers into purchasing where some is free. Free shipping, free gift, free product: all can entice customers to pay for the bundle.

 

Consider “buy one, get one free” offers, which consistently out-perform “50% off” offers simply because the word “free” is used. This is despite no effective difference in price!

 

Conclusion

Make promotions an integral, considered part of your e-commerce sales strategy, not an afterthought, and you will see increased sales.

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Interested in this topic? READ THIS BLOG —> Free Returns Pay, Paid Returns Cost

 

Sources

https://www.bain.com/insights/retail-holiday-newsletter-2017-issue-4/

https://www.linkedin.com/pulse/psychology-in-store-promotions-the-proof-phillip-adcock/

http://www.marketingcharts.com/uncategorized/local-biz-spending-on-promotions-easily-trumps-ad-dollars-28011/

http://blog.motivemetrics.com/3-Ways-to-Optimize-Product-Pricing-with-Psychology

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