I was speaking with an extremely successful business woman about Black Friday and asked if she was running a special for her retail stores. Her response was brilliant.
“I sell quality items for a fair price. In order to provide a discount, I would have to jack my prices up just to slash them. That makes no sense, but that is what most people do. Overprice everything so they can say they are giving you a discount or having a sale.”
This made me think about Apple, a company that classically never does sales or discounts. You expect to pay for a quality product at the exact price it is online or at any store.
So during this holiday season, I’d like small business owners to consider these 4 alternatives to discounts:
If you advertise that for the holiday season each client who purchases X will also get Y, you are able to showcase another item to your client base. The effect of them wanting to buy because they are getting a deal is still accomplished but you are adding value rather than making your services cheaper. You can also get rid of unwanted or overstocked inventory this way as well.
Join the shop ‘Small Business Saturday’ movement
Rather than trying to keep up with all the commercials and special that they big guys are running, why not have a lane of your own? Celebrate Small Business Saturday and get involved with local events and organizations that are showcasing small businesses and what they are doing for the holiday season.
Packages are Golden
Rather than discounting one item, a smart business owner will bundle products or services together, factor in the savings in overhead costs (time from transitioning clients, laundry, paperwork, etc), and pass that savings on to the client. If you have one client that purchases multiple services you might be able to overlap them to save time which you could then use as a package deal. You can also bundle products together since there is a marketing savings with selling more to one customer versus getting many customers. This is not discounting, it is savings sharing and has proven to be a brilliant strategy!
Differentiate, don’t discount
Rather than compete on price, promote your core values, mission, and vision. For example, advertise that you are donating 10% to your favorite charity for a day or the month. Not only does this benefit your business from a tax and publicity perspective, but this is a great way that to set your business apart from the competition while helping a cause. Many buyers today, including millennials, prefer to buy from altruistic businesses.
This holiday season, rather than slashing prices and risking your profit margin and all the hard work you have done this year, use one of these strategies to set yourself above the competition and finish your year out strong.
P.S. Comment or share how you are able to compete without discounting.