Discount delight or discount disaster?
Getting customers through the door faster!
As an avid bargain hunter, and I mean to the extremes – my colleagues at FW Accounting have nick-named me ‘Discount’– I love receiving emails from all of the local and national discount companies, Groupon, KDB deals, living social, Spree Real Deal, Martin’s Money saving tips, 02 Moments (other good phone companies are available), Buyometric, vouchercloud, wowcher!…to name but a few.
For the end customer (me!) these are an amazing new trend which are likely to save me bucket loads on getting my hair snipped, keeping my family and friends entertained, booking holidays and dining out. However, what I am interested in today is what effect this will have on the small businesses who take this route as a sales and marketing tool for their business.
The idea behind these bargain companies is to get the customers streaming through the door, and to raise your brand awareness, as well as make you a bit of profit at times of the year when business might be a bit quiet.
There are mixed opinions on how beneficial these are for your business, and I have heard a few horror stories both from small businesses and end customers utilising these vouchers. Here are some top tips if you are considering going down the bargain route:
1) First things first, ask your accountant! After all, what is the point in having one, if they can’t advise you when is a good time of the year to take a business risk, or to sit tight?
2) Bear in mind these discount companies will most often share the profit of this deal – and in most cases if the purchased voucher is unused, the voucher company will enjoy the full profit of this purchase – i.e. small business gets £0.
3) Make sure you have a limit to the number of vouchers/treatments/products that can be purchased, and reasonably limit yourself – you want to ensure that you can provide each recipient with your best possible service, and not a rushed half-hearted one.
4) Also limit yourself to the period of time in which you are to work through all of these customers; how long does it take on average to service each client’s needs currently – multiply that by the number of discount vouchers you have stipulated – probably best not to book a holiday within that time period.
5) Remember that a Groupon customer might not be a re-visitor, there will be non-loyal bargain hunters just out to find the next bargain.
6) Remember that they MIGHT be a re-visitor or a future referrer for you – give them an amazing service, when they have not paid full whack for it, and they will rave about you even more.
7) Trip Advisor – the consumer has a louder voice than ever with Twitter, Facebook and Trip Advisor – they can shout from the rooftops if they did not experience the best service – this is your chance to shine, to a larger audience than usual, don’t waste it.
8) Ensure that you have the staff, resources and produce to be able to deliver the full amount of products – you may sell all of the offer capacity. This will be a busy period, failure to plan, is planning to fail.
9) Ensure you have a clear goal of what you hope to get out of this offer and plan accordingly– do you have the minimal goal of more people seeing your brand, or do you hope to guarantee some lifelong customers.
The latter? Why not ask visitors/users to fill in a feedback form, or ask if they would be interested in joining your mailing list.
10) If you are already haemorrhaging clients and not turning your ideal profit, again speak to your accountant. An offer might not be the answer but rather a pricing exercise to ensure that you are charging correctly for your products/services.
11) Remember, this could be the perfect opportunity to expand your customer base and target a new segment of the market – if done correctly.