Ditch the discounting for good this EOFY

End of financial year (EOFY) is as good a time as any to reset your customer acquisition and sales strategies for the new year. And just as any new year presents an opportunity to let go of past bad habits; this financial year, why not let go of the last-minute discounting practices that only deliver low-value customer engagements.

Discounting detracts value

It’s almost guaranteed that in the lead up to 30 June, consumers will be poised and ready to seize the discounting available on various brands and product categories. But does the discounting actually deliver value for the brand or for the customer?

In terms of ongoing engagement with consumers, the discounting approach is the fast and dirty way to interact with a customer. The downside is that repeat purchases that lead to longer term profitability is not sustained when discounting is used.

Rewards generate value

Alternate options for running a strong promotion during EOFY is to hone in on giving. Value ads like customer rewards embrace the concept of giving.

Promotions that leverage rewards give added value to the customer, which builds engagement. The customer leaves the purchasing experience with something extra, whereas discounting only reduces the overall transaction amount. The customer still leaves the experience with the item they intended to buy – but there is no extra value.

Start the new financial year right by creating value ads, which build the likelihood of repeat purchases over a longer term.

Year-round solutions

EOFY promotions that encompass upselling incentives, free gifts and future use rewards as part of an ongoing loyalty program deliver year-round. This is because rewards add value to the customer experience.

• A free gift is advantageous as it involves zero cost to the consumer, it’s a bonus to purchasing.

• Future use rewards also act as incentives for repeat purchases. Consumers are often happy to make the purchasing decision for an item simply knowing that by doing so they will be offered options to maintain their level of loyalty rewards. This is particularly beneficial to brands as it will lead to future engagements with the one customer.

The secret to a memorable rewards experience is to leverage your brand and create a customised rewards experience. Not only does this create an ongoing reminder of the buying experience, a customised branded solution will create excitement and emotional attachment to the experience.

Rewards give an opportunity for brands to have more fun, be more creative and personalise a message. Ultimately this will help a brand or product to stand out from the standard discounting noise at EOFY.

Turn a new leaf on discounting

It may be irrational, but it’s often the case that higher priced items are perceived to be higher in quality and value. Regular discounting can negatively impact a brand as consumers learn to associate the product with less value or quality.

A consumer will discount a product if it’s perceived to have less value – a situation that results from regular discounting strategies.

Edge can help you develop a rewards focused strategy that gives value to your customer base and has a positive impact on your brand’s EOFY targets. Get in contact with us to find out how we can help your brand start strong in the new financial year.