And so it follows that showing your clients, or potential clients, that they can save money in your business can be a wise move. It can increase loyalty in existing clients, help you reach new clients and increase your conversions from ‘potential’ to ‘paying’ clients. However, putting out discount codes without a strategy can backfire, so knowing how and when you are going to offer a discount code makes good business sense. In this blog post, we’re going to take a deeper dive and consider some extra scenarios for your business.
The Early Bird
Using a discount code as an early bird pricing tool is a tried-and-tested method of building interest and excitement around your offering. Who doesn’t love a bargain – especially when being ‘in the know’ about the early bird pricing brings the reward of saving money. Here are some things to bear in mind:
- Work out your minimum price for the offering and price upward from there. Consider – if the majority of people were to use this early-bird discount, what would your profit margins be, and is that figure enough? Be sure you can cover the costs, otherwise, you might end up out of pocket.
- Market the offer in advance to build up interest around it. Announce the date of the early bird offer, so your community is prepared, and excited, to use it.
- Be sure to set a time limit for the offer that feels reasonable, and that also entices your clients to take advantage before they miss out.
Using a Lead Magnet
A discount code also works well with a lead magnet. Lead magnets are a special offer in which you exchange something of yours for the contact information of a new client (learn more in this earlier blog post).
For example – you set up a landing page for your lead magnet on your website, linking a free video in exchange for a client’s contact information. Your clients are guided to the landing page via a link in your advertising and use their discount code to get access to the offering while inputting their info. Now you have their contact details to bring them into your community, where they can learn more about your business. Voila!
Sales and Holidays
Discount codes are a great way to celebrate special events, holidays and big sale days such as Black Friday or Small Business Saturday. The simplicity of adding in a discount code means that you can reduce prices without working through all your offerings and manually adjusting each price. With a discount code, you simply set the parameters around the length of time it can be used, and how many times oper person, and share it with your community. Super-simple!
Client Incentive or Loyalty Reward
If you are looking to engage new clients, offering a new client discount can work really well – this brings people in, enables them to test out your offerings for a reduced price and again, much like a lead magnet, enables you to collect their contact information for future follow up.
Another angle on this is to use a discount code as a reward for loyal clients – for completing a challenge, recognizing their loyalty or compensating for an error in the business. Rewarding loyalty with clients shows them that you care, that you appreciate their custom and that you are paying attention to their presence within your business. All of this forms part of your client nurturing, and can have a ripple effect when those clients tell their friends and family about your business offerings.
Partnering with Another Local Business
If you team up with another local business for client referrals, using a discount code is a great way to track how successful that referral system is. How this works: you each agree to offer a discount to the other’s clients. This works great if your businesses overlap in any way (think essential oils and massage therapy, or Chiro with yoga classes). If you allocate a code that is specific to that partner, for example using their business name, you can also easily track each transaction and see how successful that partnership actually is.
Having a referral system like this can be really beneficial for both businesses if you are both committed to promoting the referrals.
The Potential Pitfalls
While offering discount codes can be a powerful way to build your business, be strategic on how often you use them. Too many discounts can backfire in a number of ways – making your business seem cheap, reducing client expectations on prices that they will pay, and can attract too many clients that are just there for the discount. It’s wise to spend time developing a strategy that works for your business. If possible, working it in with your marketing strategy in a planning session is a great idea.
Also, be sure to market and promote the codes so that the right clients hear about them. Having a code available but not advertising it effectively makes it a redundant concept in your business. Use the code in your marketing, talk to your community about it and post it in your newsletter and social media too! Talk about it as often as you can so it gets used, which will also highlight your commitment to giving clients that discount in your business.
Alternative Incentives
Discount codes are not the only way to reward your client base or to build trust in our brand, you can also add in other incentives such as offering buy-one-get-one-free, free shipping, or adding in a free gift.
Another option is to set up tiered pricing, or a pay-what-you-can model. This type of tiered payment has gained popularity since the worldwide pandemic began in 2020 when incomes around the world were affected. There are a few different models of this payment system, and it is popular. Our OfferingTree users report that when they have implemented this option in their websites, very few people opt for the lowest cost, but being able to offer it shows that you are listening, supporting and aware of differing affordability levels.
Using Discount Codes in your OfferingTree Website
Discount codes have been a really popular feature of our OfferingTree websites for a while now. It’s so easy to make them available via your user dashboard, simply scroll to Payments / Discounts and create a new code inside the website, with all the parameters you need. OfferingTree is a website platform dedicated to professionals in the wellness business, if you haven’t had a tour of your next website yet, you can watch a product demo here, or email us at [email protected] with any questions.
