In theory, running a special promotion for your small business is simple.
Choose a product or service; decide the discount; promote it; and then watch the cash roll in as consumers beat a path to your door.
And yes, that is true – to a point. Freebies, offers and discounts do lead to an uptick in sales – but you need to manage them carefully otherwise they’re a marketing strategy that will cost you money.
To do that you need to:
Set your objectives. This could be anything from attracting new customers to thanking old ones. Perhaps you need a quick infusion of cash in an otherwise slow period, or maybe you need to shift excess stock.
Do your sums. Knowing your margins, mark-up and breakeven point will ensure that your promotion benefits your small business instead of harming it.
Create your offer. Think about what type of promotion works best for your business objectives. For example, if you’re looking to clear excess stock you could run an end-of-line sale, a quantity-based discount, or a buy-one-get-one-free promotion.
Consider the psychology. There’s been a lot of research done on consumer attitudes to marketing promotions. One of the most interesting takeaways is the value people attach to freebies.
To illustrate this, think about which offer you’d go for – a 50% increase in quantity or a 33% discount on price?
If you’re like most people, the draw of getting ‘more’ for your buck will lead you to pick the former. However it’s a trick question as they both equate to the same deal.
Consumers love the idea of getting something for nothing – even if the ‘gain’ turns out to be meaningless. Use this to your advantage.
Get the word out. Build hype around your promotion by publicising it on your newsletter, website and blog. It’s also a good idea to offer your most valued customers early access to any promotion you might run. This helps build relationships and fosters loyalty.
One last thing about promotions-based marketing
Promotions are great at providing a short-term boost to your small business. Yet relying on them as your sole marketing strategy will negatively impact your brand image and put off consumers.
If you’re looking for a longer-term marketing strategy, consider content marketing. While it doesn’t give instant results, it is effective and powerful with results that grow year after year.
If you’d like any more information on content marketing and how it can help your small business, contact us at Hunter & Scribe.