If you are an online retailer and you don't have a discounting and promotions strategy in place for your online business, you can be sure your competitors have - and that's why you need one too.
Read on for some tips and ideas on how to create an impactful discounting and promotions strategy for your online business.
1. Address the Problem of Abandoned Baskets
Shoppers use an online shopping basket for its intended purpose – to make a purchase. However, shoppers will also place items in their baskets to help them make an informed decision about what they want to buy and when. They may wish to go away and compare and contrast prices and other similar products. As such, the shopping basket sometimes becomes a tool for the shopper to display a shortlist of the items they are interested in buying - and crucially, shoppers will often come back to make a decision to buy, later.
An abandoned baskets strategy should therefore anticipate what a shopper may, or is likely to do, and ensure that the purchase remains easy for the shopper if they decide to come back later and make the purchase, after thinking about it.
This is why using pop-up windows to harvest email addresses, immediately after a shopper has abandoned a shopping basket, but before they leave the website, is a useful tactic.
It means that an automated email reminder can be sent to the shopper who abandoned the basket to remind them of their interest in the product concerned, and also to make it easier for them to return to the abandoned basket to complete their purchase (just follow the links in the email).
Some retailers will even add an incentive at the stage where a basket abandonment has occurred, so for example the shopper may be offered free postage, or an overall discount if they complete the purchase of what is in the basket immediately.
that the smaller the screen the shopper is using the more likely a shopper is to abandon the shopping basket, so online retailers should also ensure that their websites are optimised for mobile and tablet shoppers.
2. Encourage Multiple Product Purchases with Discounts on Bundles
Lots of online retailers are encouraging shoppers to make purchases of items that compliment another purchase, so if someone places a CD in their shopping basket, some online retailers will automatically generate a range of suggested complimentary purchases, for example a set of earphones might compliment the purchase of a CD.
It is also possible for an online retailer to go further and offer a discount on multiple purchases that include some of the suggested complimentary products, so for example a 3 for 2 offer, or an overall discount.
3. Offer Free or Discounted Postage
Free postage is a very popular method of promoting products and services for sale online. Free or discounted postage costs can be offered on products that retailers want to sell out sooner, or merely as a means of boosting sales of a given product or service.
It is a great way to get a competitive edge over sellers of the same or similar products and an added bonus is that competitors adjusting their pricing may not always check what a product’s postage and packing charges are, with the result that competitor products can (inadvertently) be left selling at a higher price in overall terms.
4. Encourage Customers to Leave Testimonials and Reviews
Reviews are a big factor in building consumer trust. When a shopper knows that previous customers have made purchases and had a good experience, this reassures them that their experience, too, is likely to be positive.
Encouraging customers who have made purchases previously, is therefore a great way to promote a product.
How can customers be encouraged to leave reviews and testimonials? There are lots of ways to encourage this.
Email campaigns can be generated to remind customers to leave reviews. Additionally, customers can be encouraged to leave reviews, if leaving a review is rewarded by offering discounts or loyalty points which can be used to offset the cost of future purchases.
5. Offer Discounts Linked to Volume or Repeat Purchasing
A good promotion idea is to link incentives like discounts or loyalty points to reward bulk buying and repeat purchasing.
There are lots of ways to create the discount concerned. It can be generated at the checkout and displayed as the buyer progresses to make the final purchase, or it can be advertised separately as part of a wider loyalty scheme.
6. Create Quizzes and Calculators to Make Personalised Recommendations to Customers
A good way to boost online sales is to take the work out of researching and comparing products available on your site by creating a calculator, or a quiz so customers can answer basic questions and then receive a set of personalised recommendations about what products are best suited to their needs.
So, if a site is selling shoes, customers may want to take a quiz about what their footwear preferences are and then receive a set of recommendations.
These types of quizzes and calculators are good for boosting sales as customers are presented with an easy way to identify the products that are most relevant to them and their needs and desires.
7. Advertisement of Discount Codes
Creating a discount code, which will allow money off a purchase at the checkout is another way to promote products.
These types of discounts are particularly useful, because they allow retailers to boost sales for particular products that may be underperforming or not selling as well as anticipated.
The codes are very versatile as they can be advertised within blog posts or on social media.
The use of discount codes can be used to monitor sales and evaluate the efficacy of given advertising campaigns.
8. Sponsor a Charity
Sponsorship of charity will give people a positive impression of the brand and the products and services on sale.
A promotional sponsorship could pledge a given percentage of profits to a charity. The customer gets the “feel-good” factor of knowing that by making a purchase, they are helping a good cause.
9. Sponsor an Event or a Competition
Sponsorship of an event or a competition is another excellent way to promote a product or a brand
. Competitions and events often create a “buzz” and a lot of excitement and conversation. This is a useful means of drawing in new customers and extending the reach of a brand, particularly if the sponsorship is promoted on social media where people chat, share and comment on things that are exciting and important to them.
10. Reposting, Tagging or Sharing Competitions
A tried and tested promotional strategy is to encourage social media users to repost, share or like your product page in exchange for entry into a competition. It doesn’t cost users anything to enter the competition, so these contests tend to prove very popular, particularly among social media users.
In the case of social media shares - because many of the “shares” will be between friends, this achieves a level of access for the promotional messages that is often beyond the reach of conventional advertising techniques.
11. Reward Mailing List Registration
A regular mailing list output is a fantastic way to promote products and services, but in order for this to work a retailer will need a lot of people registered as interested and willing to receive promotional communications.
A simple “join our mailing list to receive discounts and promotions” campaign tends to be highly effective. In exchange for this incentive, the retailer gets to accrue a large database of people interested in their products and services. These people can then be targeted regularly with fresh, and ongoing advertising and promotional campaigns.
12. Refer a Friend Schemes
Refer a friend promotional strategies, where a new customer and the referring customer both get rewarded, are highly effective. This is because customers are themselves identifying people who they know will be interested in the products and services on offer. These people are being sold to by a trusted friend who has had a good experience of the brand concerned.
These kinds of schemes generate discussions among people and can lead to a lot of word of mouth recommendations, which is a great way to extend the advertising reach of a brand.
Discounting and Promotional Strategies for Online Retailers
An online retailer can effectively boost their sales and heighten brand recognition through a range of discounting and promotional strategies.
Some strategies will be more suited to larger, or smaller retailers, for example the use of a calculator to generate personalised recommendations for customers will incur an initial design cost. As such, it is more suited to larger retailers who can absorb these costs more readily.
Conversely, reposting and sharing competitions are more suited to smaller retailers as these incur a low, fixed cost, which will easily be offset by even the smallest boost in sales or leads.
However, retailers should be mindful that while spending cash on promotional activities is usually a highly successful strategy – this isn’t always the case, so a constant evaluation strategy should be implemented to ensure that any expenditure on a promotional campaign is justified and that ineffective campaigns can quickly be replaced with more effective alternatives.