30 September 2021

When discounts become part of the furniture: Why random frequent price cuts don’t work

One of the most common challenges for brands, whether they are high-end luxury products or at the budget mass production end of the market, is balancing higher sales with maintaining profit margins. Selling more of your products is always good for business – but it can come at a cost if you don’t get your price point right or your discounting strategy starts eating into your bottom line.

This is where intelligent sales promotions can work incredibly well – giving a shot in the arm to your turnover of stock without holding back your brand reputation or your price flexibility in the long term.

The hidden costs of simple discounting

The bluntest of instruments to increase sales is to drop your prices. Often cost is the biggest barrier to purchase for consumers, so it makes sense to start here if you want to drive more business.

But discounting has its costs. Smaller profits is the obvious one, but your brand reputation can take a hit too.

A well-run, thoughtful sales promotion is the perfect way to protect both. And, if done intelligently, it can even be more beneficial than maintaining the status quo because of the customer insights and data you can glean, as well as the boost to your brand reputation they can provide.

What’s an Insyt sales promotion like?

At Insyt, we achieve all of these things for our clients because our approach is heavily data-driven, cleverly targeted and includes a full-service offering that means you don’t need to worry about any aspect of your sales promotion.

Our compelling promotions are original and creative as well as intelligent and agile – pushing boundaries and creating the kind of buzz that enables you to achieve your sales goals in a smarter way than just lowering numbers on pricetags.

Being led by intelligent learning is also extremely important to us – listening to our clients, and their customers, and collating and analysing valuable data insights to improve promotions. We do this during ongoing promotions as well as feeding into your future, longer-term sales strategies.

Getting ahead by using intelligence

Sales promotions that aren’t targeted are only doing a half-job. That’s why we place a great deal of stock in research and data. Our expert team takes a broad view of the market and industry conditions, factoring in every relevant detail. By building the most complete picture possible, we can create a strategic and insights-led proposal.

Meanwhile our redemption model draws on our promotions expertise and uses proprietary algorithms to help predict the likely customer response to a promotion offer. We use it to help build solutions that provide the maximum sales uplift within your budget.

A risk-managed model

And we back ourselves to do a good job, too. Our risk-managed model means you’ll be covered by us for any over-redemption or under-performance of the promotions we run.

We’re more than happy to take that risk so you don’t have to – that’s how confident we are in the work that we do.

It’s our insurance and underwriting relationships that help us offer this level of security at a competitive price. We’re backed by industry giants Howden, which gives us unparalleled access to truly global underwriting reach and tailored insurance products.

It’s all this that makes us a promotions agency with intelligence.

At Insyt, we offer a wide range of bespoke promotions solutions that can help boost your sales, brand sentiment or customer loyalty. It’s all underpinned by our risk-managed approach, which enables us to develop bold and adventurous solutions for you. Get in touch with us today to see how we can help your business: hello@insyt.com