Promotional Pricing Strategies are a popular and effective way of generating revenue. Companies use this strategy to increase the demand of their products by creating a sense of urgency in potential shoppers. Promotional Pricing Strategies can be done through discounts, giveaways, or other activities that signify to customers that there is something special about the product for a limited time period. This encourages buyers to purchase the product before it’s gone!
What are the types of promotional pricing that you can use?
- Flash Sales
This is a strategy to reduce the price of some products in a short period of time to attract customers to buy them. Such discounts are usually clearly marked on the website, such as Nihao Jewelry’s flash sales example below.
- Buy One, Get One Free(BOGO)
“Buy one, get one free” or “two for the price of one” is a common form of sales promotion. This is due to the fact that in economics, the success of this promotion lies in the fact that consumers value the first unit significantly more than the second one. So compared to a seemingly equivalent “Half price off” promotion, they may only buy one item at half price, because the value they attach to the second unit is lower than even the discounted price. [1]
- Seasonal Sales
Seasonal sales are special offers, discounts, or limited edition items associated with events during the year. This seasonality happens regularly, whether it’s every year, every quarter, or on other predictable and repeatable occasions. For example, a summer sale on discounted swimwear, a sale on stationery for the back-to-school season or a mother’s day sale.
- Coupons
A coupon code or promotional code is a computer-generated code consisting of letters or numbers that a consumer can enter into a promotional box on a website’s shopping cart (or checkout page) to receive a discount on a current purchase. Such discounts are generally targeted to specific groups of people or to increase conversion and reduce abandoned shopping carts.
- VIP Discount
VIP discounts are a great way to attract potential long-term customers. Such discounts will be set at different levels. Customers of different energy levels receive different discounts. The more places you buy, the higher the discount. It incentivizes brand loyalty and continues to generate revenue from existing consumers. Nihao Jewelry has such promotional VIP discounts available.
How to Use Promotional Pricing Strategies for Your Business
1. Make Promotional Pricing Strategies Part of Your Business Plan
Your business plan should include any promotional pricing strategies that your company plans to use. This will ensure that you get the necessary funding from investors and lenders. You should also make sure to provide a clear presentation of how your company’s Promotional Pricing Strategies will work.
2. Develop a Budget for Promotional Pricing Strategies
If you are in a budget-constrained situation, make sure that you allocate enough funds to your promotional activities. You need to be able to raise sufficient money so that you can fully implement all promotional pricing strategies. Any additional costs will be deducted from the revenue generated during these periods.
3. Staff and Contract Specialists
Before implementing any Promotional Pricing Strategies, make sure that you have the necessary staff and resources to support these activities. In some cases, you may need to bring in additional contractors or assign current employees to concentrate on other aspects of your business. The success of Promotional Pricing Strategies will depend on how well you are able to execute these events or campaigns.
4. Choose the Right Time for Discount
You should check if there are any events that could affect your promotional strategies. Is there a big conference in town? Is it a holiday season? These factors can affect the response of your customers and whether they purchase your products during this time period.
5. Design Your Promotional Pricing Strategies
These strategies should be based on the objectives and goals of your company. The focus is to use these events and activities to attract customers to your business. There are various designs that you can use for Promotional Pricing Strategies, such as solo-sponsored events, company/in-house events, partner-sponsored events, or joint venture events with other companies. You should also include a clear description of the implementation period and pricing structure in your discount strategies plan. This will allow you to properly generate revenue from these activities.
6. Plan and Organize Your Activities
This is your final step before launching or starting your Promotional Pricing Strategies. You should also check if there are any laws, regulations, or other legal concerns that might affect your company’s launch. Make sure to secure all the necessary permits and licenses before you start. This will protect you from legal problems in case something goes wrong during your activities.
7. Monitor Your Events and Activities
You should regularly monitor your Promotional Pricing Strategies for any possible changes in the environment or situation of your business. Take note of such things as weather conditions, number of attendees, distribution of products and promotional items, budget adjustments, media attention (if applicable), or reactions from customers or competitors.
8. Take Action Based on the Results
Your decision to implement any Promotional Pricing Strategies should be based on the results of these events. You should review your situation periodically so that you can evaluate the performance of your marketing strategies. If you find that these activities are not yielding as much revenue as expected, you can modify them or scrap them. One way to mitigate the lack of success from your discount strategies is by including promotional events and promotional pricing strategies in various other aspects of your business. For example, you could consider placing a banner or ad about a limited-time offer in local newspapers. You may also consider distributing free samples of certain products to potential customers or clients throughout the region. These strategies will attract more visitors to your business, which will further increase sales and generate more revenue.
9. Continue Your Successful Promotional Pricing Strategies
Once you have completed your promotional pricing strategies, you need to make sure that they continue to work for you in the future. You should continue promoting your products on social media platforms through special offers and coupons. You can also increase brand awareness and reinforce the value of your products with other types of promotional items such as T-shirts, bumper stickers, mugs, pens and other branded items. The key is to stay organized so that you don’t miss any opportunities for getting visitors and customers who are interested in certain products or services.
10. Use Discount Strategies in Other Aspects of Your Business
Promotional pricing strategies are not limited to just your core business or product. You may consider implementing this strategy into other aspects of your business as well.
For example, you might consider having a special event for your employees during the holidays where you offer free food and drinks with a small gift (such as pens) for those who attend. By doing this, you can create a feeling of appreciation among your employees and strengthen the bond between them and the company.
You can also implement these strategies when it comes to marketing your brand or product on social media platforms such as Facebook, Twitter, Instagram, Google+, or Pinterest. You can post a photo or video of your company’s products, offering this merchandise for free if the user follows you on these platforms. As a result, you can get more exposure for your business and increase sales by offering promotional pricing strategies.
11. Promotional Strategies and Social Media
Social media marketing is one of the most effective tools to advertise your product and brand online. One of the best examples is when companies like Coca-Cola, Walmart, and Unilever have created their own marketing campaigns through social media sites such as Pinterest, Twitter, Instagram, or Facebook. This allows them to showcase their brands in different forms right in front of consumers’ eyes.
In conclusion, there are many promotional pricing strategies out there. This can be a very effective tool in promoting your brand and business online. The most important step is to establish what your goals and objectives are, and then design these Promotional Pricing Strategies accordingly to make the most of this marketing endeavor.
