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Which Discounts Generate Profits…

Author: Charlie Cook   |   December 14th, 2010

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When it came time to pay the bill for dinner I must admit, I felt a foolish.
There I was handing over a $10 discount coupon for a bill that was $190 but I had to admire the marketing savvy of the restaurant owner.
A few nights before, my wife had been conferring with our good friends Leslie and Will and Leslie offered to pick the restaurant and make the reservation.
Like us, Leslie is always interested in trying new places and she had a $10 coupon for Tendga, an Asian restaurant across town in Greenwich.
We knew we were taking our chances with a new restaurant but it turned out both the food and service were first rate. My only complaint was the techno music blaring from the bar.
Which brings me back to the math.
The restaurant owner spent money on a mailing to selected homes in Greenwich, CT offering $10 off. That’s right, just $10 off in a town where the average home sells for a million dollars.
The result was that he generated at least one sale of $200 and given that we’ll be back and I’m telling all my friends – just this one $10 coupon is likely to generate a couple thousand dollars in sales over the next couple of years.
Add in a few more new loyal customers the mailing generated and the simple $10 coupon more than paid for itself.
Now I know many people worry about giving discounts. After all it seems contradictory, if you want to increase your profits – giving away money doesn’t sound that smart.
And it’s true, cutting your prices dramatically isn’t the brightest move to make if you want to stay in business. That’s what General Motors did just before they filed for bankruptcy and got bailed out.
On the other hand, using discounts to generate leads, to get people in the door so you can create loyal customers who will buy from you over and over again is just plain good business. That’s what the owner of Tengda did and you should do it too.
Speaking of discounts. Want to save $10 on any MarketingForSuccess product?
Just enter “MFS-10” in the coupon code box before 12/20/10 to save yourself $10 on any order.
Go here to get started >>
(https://www.marketingforsuccess.com/store/)
Talk to you later,
Charlie
MarketingForSuccess
P.S. What’s the easiest way to get more people to your web site, or to your place of business?
Give them a reason – even one as simple as $10 discount coupon. Who knows – it could easily bring you in dozens or even hundreds of new customers and tens of thousands of new sales that you would have otherwise missed.
P.P.S. What’s the best discount strategy you’ve used to increase sales and profits?
Just go to the blog, and add your idea as a comment to this post and provide the link to your site, and get some free press for your business. Here’s the link to the blog post >>

When it came time to pay the bill for dinner I must admit, I felt a bit foolish.

There I was handing over a $10 discount coupon for a bill that was $190 but I had to admire the marketing savvy of the restaurant owner.

A few nights before, my wife had been conferring with our good friends Leslie and Will and Leslie offered to pick the restaurant and make the reservation.

clipping couponsLike us, Leslie is always interested in trying new places and she had a $10 coupon for Tendga, an Asian restaurant across town in Greenwich.

We knew we were taking our chances with a new restaurant but it turned out both the food and service were first rate. My only complaint was the techno music blaring from the bar.

Which brings me back to the math.

The restaurant owner spent money on a mailing to selected homes in Greenwich, CT offering $10 off. That’s right, just $10 off in a town where the average home sells for a million dollars.

The result was that he generated at least one sale of $200 and given that we’ll be back and I’m telling all my friends – just this one $10 coupon is likely to generate a couple thousand dollars in sales over the next couple of years.

Add in a few more new loyal customers the mailing generated and the simple $10 coupon more than paid for itself.

Now I know many people worry about giving discounts. After all it seems contradictory, if you want to increase your profits – giving away money doesn’t sound that smart.

And it’s true, cutting your prices dramatically isn’t the brightest move to make if you want to stay in business. That’s what General Motors did just before they filed for bankruptcy and got bailed out.

On the other hand, using discounts to generate leads, to get people in the door so you can create loyal customers who will buy from you over and over again is just plain good business. That’s what the owner of Tengda did and you should do it too.

Speaking of discounts. Want to save $10 on any MarketingForSuccess product?

Just enter “MFS-10” in the coupon code box before 12/20/10 to save yourself $10 on any order.

Go here to get started >>

Talk to you later,

-Charlie

P.S. What’s the easiest way to get more people to your web site, or to your place of business?

Give them a reason – even one as simple as $10 discount coupon. Who knows – it could easily bring you in dozens or even hundreds of new customers and tens of thousands of new sales that you would have otherwise missed.

P.P.S. What’s the best discount strategy you’ve used to increase sales and profits?

Just leave your idea as a comment to this post and provide the link to your site, and get some free press for your business.


2 Responses to “Which Discounts Generate Profits…”

  1. Lynn Says:

    Hi Charlie,
    I own a small business that makes bespoke furniture in solid wood. We have a great reputation and most of our customers come back to us. I appreciate that some people will look around and compare, so I give most of my customers a time sensitive 10% discount voucher… it really works and encourages people to remain “faithful” to us!! It has brought us in a lot of business from new customers because I always tell people that if they aren’t going to use the voucher to pass it on!

  2. Joe Ferry Says:

    I coach a personal trainer with his marketing efforts. One of the most successful promotions he offers is a “50 percent off an extra session.” He offers it starting right after Thanksgiving and it runs through the end of the year. His clients who come in on a regular schedule (two or three times a week) can get an extra session that week for a 50-percent discount.

    He also offers a “3-for-1 Money Back Guarantee.” New clients gets three private training sessions for the price of one and get get that money back if they are not satisfied. It lowers the barrier to entry and eliminates all risk. So far, no one has asked for a refund.

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