Even a considerable discount might not motivate a buyer

A small publisher just emailed me a 35% off coupon for their online store. They happen to have a book I wanted so I compared them to Amazon.

Amazon's price was $29.16 while the store's list price is $34.95 plus $7.50 shipping for $42.45.

Even with the 35% coupon the price drops to $27.72, only a $1.40 savings over Amazon.

But it'll take about two weeks to arrive versus two days from Amazon.

Even with what sounds like a high discount, that coupon doesn't add up to much actual savings.

Now some people will want to stick it to Amazon and books are one area Amazon is ultra-competitive on, but what about your store and its big competitor?

What kinds of prices and discounts do they have?

Can you compete with them or do you have to give away 35%+ coupons just to get the sale?

In this situation it might be better to avoid competing at all and change the equation. In the consulting world if a client has a problem with price, some consultants will try to find a way to increase the value for the same price.

Instead of a large coupon, this publisher could produce small books they don't sell and offer those to repeat customers. These could be exclusive to their store and couldn't be purchased, they are only offered at certain order levels.

Or even a more basic offer of giving away an ebook copy when every paper book. The ebook versions are selling for almost the same price on Amazon so this becomes close to a 2-for-1 deal.

This changes the whole equation from "get it quickly from Amazon for $29 VS get it slowly direct for $27" to "get it quickly from Amazon for $29 VS get it direct for $35 in two weeks and an ebook copy in two minutes".

That's why I try to mention alternatives to discounts in Repeat Customer Insights advice. They absolutely can work but they can also cause more problems for your store, especially in the long-term as they can change customer behavior.

Eric Davis

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Topics: Customer behavior Discount

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