Remember the social couponing craze? When they launched several years back, social deals – in which consumers were able to buy prepaid vouchers for super-cheap restaurant meals, services and products – seemed like a great idea for everyone: businesses were able to quickly grow a huge new customer base while purchasers were thrilled by bargain-basement pricing.
But as consumers snapped up offers, many businesses discovered that using steep discounts to drive business didn’t make as much sense as they thought. Many businesses found the cost of honouring the deals was far greater than the reward.
As a result, social couponing has fallen from favour. And though promotional offers are still seen as a great way to drive new business, for small businesses they often feel like two steps forward, one step back. Deals may boost consumer interest, but discounts and freebies can erode profit margins and revenues.
It doesn’t have to be this way. Incentives that add value for your customers and also support key business goals can be a win for everyone – especially if you connect them with targeted local audiences, something Yellow Pages experts can help you with.
Here are four types of offers that will hook your customers and help you grow your business at the same time.
1. Loyalty rewards
If the cost to benefit ratio of “buy one get one free” (or even buy one get one 50 percent off) seems too steep, consider an ongoing loyalty plan. Rather than rewarding customers with a freebie after just one purchase, their gift doesn’t kick in until they’ve completed a specified number orders or purchases. Not only does the greater spend that’s required offset a greater proportion of the cost of fulfilling the reward, but each time the customer chooses you over your competition you’re growing loyalty and making patronising your business part of their routine.
2. Referral incentives
Happy customers can be some of your most powerful assets when it comes to growing new business. In fact, word-of-mouth recommendations from friends and family members are considered the most influential type of advertising around. Personal referrals can also defray the “cost per acquisition” – the cost of gaining a single new customer – one of the measures by which you can gauge your marketing activities. Rather than leaving referrals to chance, consider rewarding customers for successfully sending you business. Referrals don’t have to directly translate into a freebie or discount to be rewarding for your customers – for example, you could grant “thank you” extensions to existing service contracts in monthly increments (which may cost you nothing in the long run) or cast a raffle ticket for each referral into a monthly thank you draw.
3. Bundles and volume incentives
From fixed price menus to speciality channel packages, bundles are a tried-and-true way to increase the monetary value of individual customer transactions. Bundling means that while items each has their own price when purchased individually if a customer buys a suite of items at one time, they receive a package price. You can pinpoint which bundles are likely to drive the most interest from customers by thinking about which products or services people often purchase at the same time, or anticipate customers’ needs – another trick for growing satisfaction – by bundling in a complementary product or service you know from experience that they’ll find helpful. Volume incentives, in which customers receive a discount for buying in bulk, can also grow the total expenditure within individual transactions without costing you a great deal and make your customers feel they’re getting good value. You may even want to consider offering volume incentives on a sliding scale – the more they buy at one time, the greater the savings.
4. Value-adds that kick in at specific thresholds
How many times have you added one last item to your cart while online shopping just to get free shipping? By throwing in services that customers would likely (and often reluctantly) have to buy anyway – things such as delivery, installation or removal and disposal of their old item – you can grow customer satisfaction and get people to spend more at the same time. You might even find that reducing prices to just below the threshold level encourages customers to spend more in order to hit the trigger amount.
You’ve got a great deal. It’s time to let people know
Now that you’ve developed an offer that will make customers happy and directly help you grow your business at the same time, it’s time to let everyone know about it! From search engine advertising and display ads on relevant websites to print placement, Yellow Pages experts can help you get the news in front of people who are ready to jump on your offer.