The first ever discount voucher was distributed by none other than Coca-Cola in 1887. The company had no idea at the time how crucial the concept would be in shaping the future of commerce. Business owners are continually faced with the challenge of customer acquisition and retention. They commonly ask questions about how best they can capture the attention of potential customers and encourage them to spend at their business. The largest misconception regarding sales promotions is the belief that there is a constant need to offer mad discounts in order to drive sales conversions.
In this piece, I will tell you how to establish some successful discounting strategies.
Discounts
The purpose behind discounts and promotions is to persuade consumers to view your restaurant. They offer an extra incentive for customers who are undecided about ordering from your restaurant. At the end of the day, a discount can be a major deciding factor for consumers, as every discount helps. The use of effective discounting boosts customer acquisition and drives customer loyalty.
Promotions
Advertisement messages are inescapable in daily life. Consumers have adapted to being regularly targeted and can filter out any unwanted messages. We live in a word of advertisements and with that many businesses taking over billboards, buses, window displays, televisions and even our own mobile devices, how can a business stand out from the crowd?
Why To Run Promotions
- Increase Movement of Stock
At certain points of the year, you probably notice slight changes in the products and menu items you are selling out of the quickest and that they may be stagnating. Although it is challenging to keep up with customer taste trends, demands are far more crucial. In addition, you do not need to let your extra stock go to the bin.
2. Sales Goals Achieved
Every business has goals and targets to reach each week, month etc. Your business must be aware of the niche market opportunities that can result in a rush of sales and new customers.
3. Building Relationships with Customers
It is highly important to keep your loyal customers happy with discounts and vouchers readily available to them. It is said that over the course of a year, return customers spend an average of 120% more.
The Science Behind Discounts and Promotions
- Vouchers and Discounts Create Happiness
The use of vouchers and discounts genuinely makes people happier. Redeeming vouchers creates higher oxytocin levels and results in lower levels of stress, according to a study carried out at Claremont Graduate University. The research revealed that receiving a voucher is more enjoyable than receiving a gift. This is particularly true if a brand or company who does not usually use discount marketing releases a voucher or promotion. Receiving an unexpected discount means that consumers feel excited and are ready to spend their money. In addition, consumers spend more in order to use a voucher that has a minimum threshold.
2. First-Time Buyer Confidence
If you have released a new product or service, discounts and coupons are vital for hooking new customers. Most shoppers do not feel at ease paying full price for an item or service that they have never purchased before or know nothing about. The opportunity to try it at a discounted price can transform the shopper’s attitude and persuade them to make the purchase. Once the discount strategy encourages consumers to give you a chance, you open the door to creating long-term customers.
3. Discounts Create Urgency
Discounts and coupons that have a clear expiration date increase sales as they create a sense of urgency. Shoppers feel that if they do not take advantage of the good deal, then they will have to pay more for it later. In addition, they do not want to feel as though they are missing out on anything. This is particularly true for people who have missed a deal in the past.
4. Customers Expect Discounts and Promotional Prices
Discounts do work to increase sales, however, there are some flaws to discount marketing when it is not carried out correctly. The reason for this is that consumers now expect deals. This still goes for restaurants as often if consumers can find a better deal elsewhere, they will go elsewhere. This is why it is crucial to carefully plan out your promotions and make them worthwhile for consumers.
Conclusion
Promotions and discounts work to persuade people to spend money with your business, however you must ensure you carefully plan out your strategy and make them worthwhile for your customers. This piece will work as a guide to promotions and discounts, it provided reasons why they are important to run and the science behind their success. Hope you enjoyed the read, good luck implementing your own promotions and discounts at your restaurant.
