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22 Dec 2015

It is possible to describe discounts as marketing tools that really help drawing customers to your business by allowing them money savings on buying certain products or multiple products and form a significant strategy for online merchandising of merchandise and marketers often utilize them for introducing new items and retaining old customers, thus enhancing revenue.
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Liquidating Surplus Stocks

They will use discounts to push sales of chosen products through customers who fulfill certain laid down conditions. For instance, you can have a couple of items occupying your shelves, while they did not sell to expectations. You could offer special reduced prices to trade those items. For example, consider you huge pile of t-shirts would not sell during December. You might get rid of this surplus stock by providing substantial reductions for a restricted period to a specific type of customers.

Discount Types

• Plain discount: You might offer the chosen product at reduced prices as a percentage of the listed price or straightway in terms of dollars. Here is an example; buy one shirt and get 25% discount on the start-up price.

• Least Buying discount: You may choose to offer discount to clients who get a minimum specified quantity. One example; on purchasing two shirts get 20% off for both the shirts.
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• Get one Give One Free: Give a gift on getting a least quantity. For example, on buying one shirt, obtain the second one free.

• Paired Discount: Provide a discount on a particular product on buying another specified product. If you decide on one shirt, pay 10 dollars less on jeans.

• Paired Set Discount. Propose a discount on one item for choosing specified quantities of another product. For instance, buy two pants and have 30% discount on a set of jeans.

• Order discount: Provide a reduction in prices or offer shipping for nothing on the total price of the order on buying goods worth a minimum specified amount. For instance, on buying goods worth $100, get a 10 percent discount on total billing.

Pricing Policy

Locate a pricing policy that helps meeting sales objectives while gaining better reputation, providing the most profit, and developing a good demand for goods. This policy of offering discounts certainly helps attracting clients but for short terms only. If utilized on a long-term basis, this insurance policy influences brand loyalty and market positioning negatively.

Great deals enable businesses to trade large volumes of low-priced items. On deciding to follow this strategy, it really is imperative to cut prices and turn into competitive. Larger stores can demand quantity discounts from manufacturers and effectively design their pricing strategy.

Use discount on list prices carefully and sometimes. It helps to offer occasional reductions to regular clients. If offered too frequently,they may set a spiral of the best prices, making it rather challenging for you to sell goods at normal prices.

Benefits and drawbacks of Discount Pricing

Discounts present an excellent opportunity to keep customer loyalty, particularly when you consider the rewards to employees, repeat and volume customers. This discount policy, when put on a short-term basis permits the company to sell more units during this period, accounting for a transitory revenue boost and important inventory reduction.

Before deciding upon your discount pricing strategy, you would do well to consider product positioning also. Sometimes, where the product won't have an accredited brand name, consumers may read a minimal price in perceived consonance with lower quality. Such customers should go in for a branded quality product over price.


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