Although the Internet has made customers more savvy and informed than ever, the line between a run-of-the-mill promotional deal, and an absolutely irresistible one is often thin, and based on more than just simple numbers. Everyone, even those that are marketers by profession, can be affected by the subtly powerful marketing ploys that are commonplace in modern retail. Everyone knows the ancient trick of selling a product for a penny or two less, and yet it still works almost magically. A product marked $22.98 just seems like a much better deal than one marked $23.00, even though anyone can see that it’s only $0.02 less expensive. Another popular tactic is the classic perspective shift in discounting merchandise. This works by offering a certain discount, but phrasing it differently to make it sound more appealing. An example of this would be something like a product that regularly sells for $2.50 each. You might offer it at a discounted price of five for $10, resulting in a savings of $0.50 each, or a 25% discount. Depending on the type of product and price point, phrasing the deal in these different ways can mean the difference between an easily ignored deal and an irresistible one. At a higher price point, these subtleties become even more pronounced. If you’re selling a television that normally retails for $1000, offering a sale of 15% off doesn’t sound like much to many consumers. However, if you were to phrase it as “$150 off,” it stands a better chance of resonating as the great deal that it actually is, because $150 is an amount that everyone can immediately identify with. This is the subtle language of retailing that, when mastered, can really boost your sales. The extremely popular “daily deal” websites work in much the same way, by adding a time element into the equation. By utilizing daily promotions, you can begin targeting your market in a way that consumers will find irresistible.
Over the last few years, the growth of the daily deal promotion in online marketing has been meteoric. Groupon, the now famous daily deals website, launched in November, 2008. Only 17 months later, it had built up a subscriber list of over 30 million users, and was valued at an astonishing $1.35 billion. Forbes magazine called it the “fastest growing company ever,” adding that its success represents “what the dot-com boom was supposed to be all about.” So what is it that Groupon has done so well, that so many deal-related websites had missed before? Besides having a great business model themselves, they recognized that adding the time element into the deals they were offering would make the promotions they were running irresistible to consumers. Regardless of the size of your company, you can make use of these same principles and be targeting your market in the same way with a minimal amount of effort.
You may have heard salespeople and marketers talk about the “standing-room-only” close, or putting a potential customer into a high-pressure situation where they feel that they will lose out on a great deal if they don’t act and make the purchase right then and there. Often associated with the sleazy “used-car salesman” stereotype, this sort of underhanded tactic has fallen out of favor, now that the Internet has educated buyers, making them more confident in their ability to negotiate great prices. However, this tactic existed for so long because it worked. The “ticking clock” is a real motivation to buy, and you can use it to begin targeting your market effectively, only without the high-pressure tactics. This is why daily deals have proven so popular. A single-day timeframe is one that is easily understood by consumers. Most companies offer promotions that vary widely in the time available. Some deals might last days, others weeks, while other companies have made a habit of inflating their retail prices so they can offer “sale prices” in perpetuity, defeating the entire idea.
However, by offering real discounts on a daily basis, you’re presenting your customers with a simple and fair deal that’s quickly understood, and easily acted upon. There’s no need to mark a date on the calendar for when the deal is up, or make mathematical calculations to decide if the deal is even a sale price at all. Customers appreciate being treated with respect, as the intelligent consumers that they are. If you offer them deals that make sense, they’ll respond by offering you their business.