Duane Roberts 
In today’s highly competitive market, businesses continuously look for ways to attain a competitive edge. One common strategy that many companies adopt is offering special discounts to their customers. Discount are a marketing tool that companies use to attract customers to purchase their products or services. But, when is it worthwhile to offer special discounts?
In this article, we will discuss when it is worthwhile to offer discounts to your customers. We will explore the situations that businesses should consider and the benefits of offering discounts to their customers.
1. Slow Business Periods
One situation when it is worthwhile to offer discounts is during slow business periods. Typically, businesses have a particular peak period during the year when demand is high, and sales are more substantial. During the slow business period, the demand for products or services plummets and businesses experience less BOGO (Buy One Get One), free trials, coupons, and sales. As a result, businesses may have slow sales affecting their profit margins.
Offering special discounts, such as BOGO or coupons, can help businesses attract more customers to their products or services. Discounts can help spur sales and increase customer loyalty, and, as a result, drive business results.
2. Introducing New Products or Services
Another situation when it is worthwhile to offer discounts is when businesses introduce new products or services. Introducing new products and services requires businesses to acquire new customers, particularly when they want to take out their competitors.
By offering discounts on new products, businesses can attract new customers whose buying decisions may have been influenced by price, and thus this gives the business a platform to showcase the new product. Discounts can also help to create positive word-of-mouth and increase customer loyalty over time.
3. Customer Retention
Offering special discounts to customers can increase their loyalty to the business long-term and encourage repeat business. Retaining loyal customers can save a lot of money for businesses compared to attracting new customers every time.
By offering discounts, such as loyalty programs, special sales, etc., businesses can keep customers engaged and appreciated. Loyal customers typically spend more and may refer new customers to the business, increasing the customer base and resulting in higher profits for the business.
4. Moving Excess Inventory
Another situation when offering special discounts is worthwhile is when businesses have excess inventory. Businesses may have slow-selling items or products that are soon to be out of season.
By offering discounts on these items, businesses can move their inventory quickly and avoid high storage and inventory costs, thus improving overall profit margins.
5. To Increase Sales Volume
Offering discounts can help businesses to increase sales volume or attract customers who cannot afford the product or services at the initial high price. Customers who purchase products/services at a discount feel like they have gotten a good deal, and this can influence their decision to do business with the company in the future.
Conclusion:
Offering special discounts to customers is not always essential and does not guarantee the success of the business. However, when applied correctly and at the right time, discounts can attract new customers, increase customer loyalty, and improve overall profit margins.
Businesses should consider different factors when deciding to offer special discounts such as slow business periods, introducing new products or services, customer retention, moving excess inventory, and increasing sales volume. Thus, businesses can make the most out of the discounts they offer and drive business results.