Because I've been in so many debates about this over the years, I'm guessing others have too. It's a small thing - tactical and executional but worth getting right.
When deciding on discounts and promotional offers, don't talk in percentages - unless you really have no other way of doing so. People are busy and most do not have time to figure out percentages.
For example, I know "20% off" sounds high and the argument is that consumers may not do the maths but they appreciate or feel that this is a good deal. My view is that you are better off explaining this in real absolute amounts. So if 20% works out as €1.50, then say "€1.50 off" in your advertising or point of sale.
Just because I say it here doesn't mean it is true - instead seek out the real experts such as Drayton Bird, Bob Stone, Axel Andersson and Denny Hatch. I dug out this quote from Axel - "The only percentage most people understand is 50%, and is that case I prefer half price or buy one, get one free."
Better still - test it.
One quick and cheap way to test the way offers are communicated is to do some quick Google adword tests. You'll have enough analysis within days (or hours sometimes) to allow you to roll out the higher-pulling headline in your other media.
Finally, I once even heard a suggestion to offer a 3% discount for a consumer offering. Our group spent a few minutes trying to work out if this was good value or not...
2 comments:
I used to work in a clothing shop during my university days. We did an experiment with this. We put two tables of identical t-shirts next to each other. One had the buy one get one free promotion and the other was 50% off. The BOGO table sold out in less than a day. The 50% off took over a week!
thanks Deborah. I've done a couple tests myself and they back up your results.
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