With the hyper-crazy-growth of group buying sites, like Groupon, small businesses should be careful with overusing the “overwhelming offer.”
In a previous post, Keys to a Spreadable Promotion, we talked about the need for a promotion. However, can a 40%, 50%, or 60% off deal be too good? Absolutely! Your biggest danger is price erosion. Remember Econ 101? Price is what someone is willing and able to pay. But more importantly, price is where someone is willing to sell. So, when you’re selling something for 50% off, you’re telling a customer that’s how low you’re willing to go.
At Promoboxx, an online social promotion platform, we recommend providing fair offers, that differ from month to month. Keep your customer guessing. Mix it up with coupon promotions one month, and then a sweepstakes the next.
Never give a price you wouldn’t be willing to give on a consistent basis.
Updated by Ashleigh Anderson on May 23, 2022.