Should Your Business Offer Coupons?



Last Updat: Aug 3, 016
Coupons are oft us to attract new s and tice old s to come back. At first glance, offering coupons seem like a great idea. Before begin discounting, consider these pros and cons.

So now have r product or service out and available to the public. ’ve set r prices, calculat r budget, and know all too well r business’s overall bottom line. But despite r best efforts and r tireless planning, cannot seem to attract ough s. Maybe it’s time to consider offering a promotion or coupon.

r first reaction may be to see this as quite obvious. r business offers a discount and pottial clits will see this as a low- opportunity to try something new. But there are some concerns that ought to be ress wh considering as to whether or not r business should offer a discount or coupon in the first place. Here is a list of the pros and cons involv in this decision.

Let’s look at some key pros first…

Meeting Expectations. According to a rect survey conduct by RetailMot in conjunction with The Omnibus Company, 96% of shoppers reporting having us coupons within the last three months. This report shows that the majority of shoppers are expecting a discount or coupon. Offering coupons and promotions has now become a normative aspect of running a business.

Competition. With the exception of a relative monopoly, chances are r business is facing some stiff competition. In this market, businesses must fight for a ’s atttion. Most consumers are shopping around for the best deal, and having r business offer a discount may just bring the competitive ge against r competition that ’ve be missing.

Inctive. It is logical to assume that a is more likely to try or experimt with r product or service wh a discount is offer. It can offer a pottial a low- opportunity to test out a new product or service for the first time.

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Ease of Distribution. In our modern era, producing and distributing coupons is now easier and faster than ever. A coupon can easily be shar via social mia, email, or through one of the many coupon websites. This can also serve as a form of free advertising for r business.

And now a few cons:

Cutting Profit. One common concern is that introducing a discount or coupon will just subsidize a purchase the consumer would have made either way. Depding on r particular industry, this is a real concern that nes to be ress wh considering this decision for r company. However, the pitfall behind this assumption is the failure to recognize the new s that such an offer could attract. Coupons and promotions can oft attract new s, and instill a sse of loyalty in r existing base.

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Margins. Wh setting prices for products or services, one factor that must be consider is the cost. Wh introducing a coupon or discount, cost is an important factor to consider. A coupon will effectively lower the price, but cannot lower the cost. It may be beficial to offer a discount to attract s, but it is important to always consider r bottom line.

Sustainability. Some s may only reem the coupon, receive the product or service, and may never return again. Perpetuating a series of coupons and discounts in this manor may only lower r monthly revue, and it may not result in return s.

Crowding. One common concern is that r coupon strategy may work too well, and may crowd out those existing s who pay full price. This is especially relevant for businesses whose products or services are in relatively limit supply.

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Conclusion

Ultimately, every business must carefully consider the pros and cons involv wh considering implemting a new strategy or policy. Only those who know their existing clit base and financial situation can judge whether this would be a move in the right direction. The key to offering discounts is to make sure it is ultimately in r best interest to do so. Therefore, must thoroughly under r profit margin, r industry, r pottial base, and r loyal base. Th decide.

© 015 Attard Communications, Inc. All Rights Reserv. May not be reproduc, reprint or ristribut without writt permission from Attard Communications, Inc.

Brad Egeland is a Business Solution Designer and IT/PM consultant and author of A Real World Project Manager’s Guide to the Successful Project. He has over 5 years of softe developmt, managemt, and experice leading initiatives in Manufacturing, Governmt Contracting, Creative Design, Gaming and Hospitality, Retail Operations, Aviation and Airline, Pharmaceutical, Start-ups, Healthcare, Higher ucation, Non-profit, High-Tech, gineering and geral IT. Brad is marri, a father of 11, and living in sunny Las Vegas, NV. Visit Brad’s site at www.bradegeland.com.

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