As an e-commerce business owner, you understand that pricing is most important to customers.
The right e-commerce strategy can move your business toward success while the wrong e-commerce discount strategy can have negative effects on your business.
So how can you compete with low-priced products and make sure your discount pricing pays off?
The answer is in the strategic discount pricing tactics you choose –– and when and how you use them.
In this guide, you will learn about the top ten popular e-commerce discount strategies and how to employ the right strategies to increase the conversion rate for your company.
Inspire and Engage
At Pretty-Impressive, each client is unique. Which is why we create strategies tailored to the needs of each company. Reach out and we’ll help you get your brand exactly where it needs to be — ahead of the rest.
Top 10 Popular E-Commerce Discount Strategies
If you’re already squeezing out a lean profit margin, offering a discount may not seem like the best marketing tactic for your business.
But discounting prices is a short-term sacrifice that has been the driving factor for many e-commerce businesses in tough economic times.
Deploying an e-commerce discount strategy can provide just the push a customer needs to choose your products or services over the competition.
The savvy marketing experts at Pretty-Impressive build integrated multi-channel marketing campaigns that utilize these top ten popular e-commerce discount strategies to help your company attract and keep more customers who buy more –– more often.
1. Discount Codes
Digital money-off vouchers or discount codes allow customers to submit for a discount with any purchase.
Reasons to implement discount codes include:
- To target specific customers for a chance to get money off
- To offer influencer partnerships to share with their followers
- To celebrate an event
- To promote a specific line of products
2. Seasonal/Promotional Discounts
Seasonal discounts are a great way to kick off sales at the beginning of peak seasons.
Offering discounts based on the time of year generates buyer anticipation and helps you clear out last season’s inventory to prepare for the coming season.
A promotional discount can also be used to reward customers who purchase during a slow season or to promote a product launch.
The key is to keep promotional discounts short-term and focused on a goal, like driving a holiday sale.
Avoid offering promotions too often since too many promotions can signal to your customers to wait until the next promotion to order from you.
3. BOGO Sales
Offering a buy one get one (free) — also known as a BOGO sale — is a sure-fire way to move excess product from your inventory quickly.
Before you rush to tender that BOGO sale, it’s important to check your local laws first.
BOGO offers will usually claim the second item is “free.” That means if a customer must buy something to get something free, they’re getting a 50% discount –– not a “free” item.
Be sure to detail the real savings of your BOGO sale precisely so it’s simple for the customer to calculate themselves.
4. Loyalty Discounts
A loyalty discount is a highly effective way to build a bond between you and your best customers.
It will make your loyal customers feel special –– in turn, they’ll continue to support your business.
Research shows if you want to get the most value out of your loyalty rewards program it must be keenly designed to build customer loyalty.
Be intentional and clear about the terms and only offer the discount to those who qualify, whether it be to your:
- Repeat customers
- Longtime customers
- Membership customers; or
- Other specialized groups
5. Subscription/Membership Discounts
It will cost your e-commerce business more money to attract new customers than to retain old ones.
So why not avoid risking low customer retention rates by offering subscription or membership discounts?
Similar to the loyalty discount, reward customers who sign up for a subscription or membership with an exclusive discount to make them feel like they belong to an exclusive group.
Customers will appreciate your brand’s generosity. Plus, it’s a great way to create opportunities for future exchanges.
Additionally, consider offering discounts can to members of other specialized groups, like:
- American Association of Retired Persons (AARP)
- Military
- Automobile Association of America (AAA);
- And more
The positive reinforcement will strengthen your relationship with your existing customer base who will feel seen and appreciated for their continued support.
Plus –– non-subscription customers who are aware of this extra discount for signing up are incentivized to do so.
6. Abandoned Cart Discounts
Customers will shop online and leave their cart without purchasing for many reasons.
With an average abandoned shopping cart rate of 69.80%, that means nearly 70% of customers are leaving your online store empty-handed.
All the work you did to attract those shoppers is wasted.
An abandoned cart discount is designed to draw those customers back with the incentive of money off if they complete their order.
7. Flash Sales
Big shopping events announce limited-time offers to create a sense of urgency in the minds of shoppers.
Buyers become eager to make a purchase when a product is being discounted under timed conditions.
Customers get discount pricing on any amount of products for a limited time, including as little or as long as:
- 12 hours
- Six hours; or
- 24 hours.
Flash sales tap into a sense of urgency, which can compel on-the-fence customers to make their purchase before it’s too late.
8. Free Gift With Purchase
For e-commerce stores, there are several discount tactics that you can use to entice new customers to buy from your company.
Influence customers’ buying decisions with:
- Free shipping to first-time buyers
- A free complimentary gift with purchase for new customers; or
- Reduced pricing for every new customer who spends over a dollar amount
9. Free Shipping If You Spend A Certain Amount
Free shipping provides an incentive for shoppers who might still be on the fence about purchasing all or some items.
This tactic lets them unlock free shipping:
- No matter the purchase amount
- If they spend over a certain amount; or
- If they buy a certain number of products
And it works.
According to the Q2 2021 Consumer Trends Report conducted by Jungle Scout, 66% of American consumers expect free shipping.
Mobilizing your existing customers to buy more through a free shipping offer increases your profit margin and your average order value (AOV).
10. New Customer Discounts
For e-commerce stores, there are several discount tactics that you can use to entice new customers to buy from your company.
Influence customers’ buying decisions with:
- Free shipping to first-time buyers
- A free complimentary gift with purchase for new customers; or
- Reduced pricing for every new customer who spends over a dollar amount
For e-commerce stores, there are several discount tactics that you can use to entice new customers to buy from your company.
Influence customers’ buying decisions with:
- Free shipping to first-time buyers
- A free complimentary gift with purchase for new customers; or
- Reduced pricing for every new customer who spends over a dollar amount
Inspire and Engage
At Pretty-Impressive, each client is unique. Which is why we create strategies tailored to the needs of each company. Reach out and we’ll help you get your brand exactly where it needs to be — ahead of the rest.
How Do You Know Which E-Commerce Discount Strategy Will Work Best for Your Company?
When executed correctly, the right e-commerce discount strategy can:
- Deliver your company from challenging economic times
- Grow your business
- Boost sales
- Increase profits
On the other hand, an ineffective discount campaign can:
- Lower your return on conversions
- Decrease average order values
- Diminish brand value
So which e-commerce discount tactic will work best for your company?
That answer varies with each company. That means that only data and consumer behavior patterns can determine which approach will be the most successful for your business at any given time.
Still, you must consider your unique …
- Brand
- Goals; and
- Customer
… when conducting market research.
Unsure of Which E-Commerce Discount Strategies Are Best for Your Business? Pretty-Impressive Is Here to Help
Don’t make the mistake of relying on gut feelings.
Through unparalleled market research, the professionals at Pretty-Impressive can uncover the insights to hone in on the e-commerce discount strategy that will boost your profit margins.
In addition to discount strategies, Pretty-Impressive builds integrated multi-channel marketing campaigns that include:
- Marketing analysis
- Growth marketing
- Email marketing
- Facebook ads
- Google ads
- SEO;
- And more
We are committed to your return on investment (ROI) by focusing on:
- Long-term growth
- Turning ad money spent into profits; and
- Making educated decisions based on reliable data
To find out how you can increase your profit margin, or implement an e-commerce discount strategy with the help of Pretty-Impressive, schedule a free strategy session today.
