3 Potential Risks to Your Business of Providing Price Promotions Too Often
Offering discounts to purchase your products or services can be an effective strategy for producing quick, short-term and positive results. That said, it shouldn’t be relied upon entirely as a cover for bad products or services, nor should it be used to substitute other long-term marketing strategies.
Read on and make yourself aware of some ways that providing sales promotions could potentially produce negative effects and work against your business.
1. Tarnishes your brand reputation, or your product or services’ perceived quality
Think about how you’d like to position your brand in the minds of the public.
If your business is frequently pushing out promotions, the public may start to question the legitimacy or quality of your product or service. As promotions are known to be a strategy that builds sales, you could be creating a negative image on your product or service if people suspect that the reason a promotion for it exists is the result of a lack of sales. Keep in mind that once a particular image of your brand or product/service is built into the mind of a consumer, it’s very difficult to change or overcome it.
2. Could produce demands that you can’t fulfil
People love a good deal. So, if you’ve got a booming product or service, provide customers with a special promotion for it, and market it effectively, you’re more than likely going to see a spike in your sales.
While you may be thinking of this as a great thing - the increase in demand as a result of promotional strategies has the potential to backfire if you don’t plan for it well. Poor planning - whether that be in double booking clients, overbooking a fitness class and having to turn customers down or away can result in consumers mistrusting you or your business.
3. Changes your consumers’ pricing expectations
Relying on sales promotions too often in order to boost sales can affect your consumers’ willingness to buy when your products or services are at full price. Because consumers will have built up expectations based on previous promotional packages you have pushed out, it can often lead them to put a hold on buying your product or service until they foresee or expect another promotion again. In order to prevent this, uncertainty is key!
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