Practicalities- How to Offer Discounts without Losing Money

There are many things to consider before creating an offer or discount for your store, here are just a few:

1. Cost

Can you afford to discount your products? Will the final price of the discounted product cover the cost? Will the profit from the offer cover any advertising costs? Ensure that you do not lose anything from offering a discount. Wait until you have a strong enough client base to cover any losses.

2. Statistics

Assess your own data and try to figure out how many customers are actually asking for a discount, and if these are the kind of customer you want. Take a look at your competitors prices and assess whether they are selling more of the same item, and maybe consider re-pricing rather than a one time offer, after all, making more sales then taking a dip in profits can be disheartening.

3. Redemption

How many customers are you going to offer your discount to? Consider offering discounts to loyal customers only, so that new customers do not get spoiled from the start and regularly demand discounts.

4. Conditions

Make sure the terms and conditions of your offer are clearly stated, or easily able to be seen wherever it is advertised. Be strict when customers look to redeem vouchers and ensure that all the conditions are met. For example, if a 10th coffee is free after 9 coffees, do not allow a free coffee after only 6.
Some examples of terms could be punctual payment or referrals.

5. Preparation

Consider how much stock you have- will an offer on a certain product diminish your stock? Do you have enough staff and packaging for a spike in orders? Make sure you are prepared, and always ensure you write “While stocks last” in the terms and conditions!

6. Reputation

Are you branding yourself as a seller of luxury items? Could a discount diminish this reputation? New customers who sign up because of an offer may later demand more discounts because they started with one - and is this the kind of customer you want to have?

7. Platforms

Where will you advertise this offer? Will it be solely via social media? Perhaps consider your current audience on these channels and assess which would be best for what you are aiming for. Do you need more followers on Instagram? Create an offer solely on Instagram.

Do you have any issues creating offers on Shoprocket? By all means email us on support@shoprocket.co.uk and we'll be happy to help!