How to Get Discounts to Make More Profits?

The Benefits of Discounting are quite high. Customers Think Positive About Your Brand. You Get Ahead of Your Competitors. Of course, there are damages to discounting.

How to Get Discounts to Make More Profits?

Small businesses often choose the discount method to increase their sales volume. But there is a problem here: If a correct strategy is not followed, discounting both damages the image of the brand and decreases profitability.

So how can you be sure that your business will not suffer by making a discount, and that you will benefit from it?

You need to set tight goals, and learn about different methods to achieve these goals. More importantly, you have to make sure that you achieve your goals and focus on the right parameters for this.

In this article, we will give you useful tips on discounting. Thus, the discounts you make will be beneficial for both you and your customers and you will really profit.

1. Benefits of Discounting

If you discount your prices, this will increase the amount of sales. In other words, you can think of a product that you sell to 10 people for 100 lira as selling to 135 people for 80 lira. Discounting can also help to attract new customers.

Customers Think Positive About Your Brand

When you get a discount, customers will no doubt appreciate it. Studies show that people feel happier when they get a discount. This satisfaction of people with your brand can have a positive effect on your brand in the long run.

You Get Ahead of Your Competitors

When you make a discount, people tend to choose you over competitors that do the same job as you. The Max Planck Institute tells this to a study in the public finance department.

2. The Harms of Discounting

There may be some negative situations that you may encounter while making a discount. These risks should not be ignored before going for a discount.

Discount Lowers the Perceived Value

While a product is sold for 110 liras in X company, when you sell this product for 90 liras, a doubt appears in people's minds. "I wonder if the defective products?" people think. So they can identify the discount with poor quality.

According to a study, people who bought a product by paying the normal price are more satisfied than people who bought a discount. In other words, people who buy the product without a discount have more positive feelings about the product.

You get potential earnings

It is also possible to make no profit from this business by making a discount. That is, some people buy X products regardless of the price. When you make a discount on this product, you lose the amount of the discount.

It is essential to know the intricacies of discounting in terms of such benefits and harms.

3. Set Your Goal Before You Discount

Before you discount the price of your product or service, you must have a clear goal. In line with this goal, you can decide on the discount rate, the products to be discounted, and the target customer group.

For example, let's look at some of the goals you can set before the discount.

a. Gaining new customers

You may want to get a new customer base by discounting. Thanks to the discount, these people want to try out your products at a lower risk. Also, if your discount is valid for a limited time, new customers may want to buy the product or service immediately.

b. Increase sales

You may want to increase the unit sales volume regardless of how many people buy it. So think like selling 140 carpets instead of 100 carpets.

This increases the sales volume, allows it to be combined with other products and may cause customers to buy more than one product at the same time.

c. Consolidating existing customers

It is also a good goal to make your existing customers shop more instead of gaining new customers. In other words, you may want to increase the loyalty and loyalty of existing customers to your brand.

Such a discount usually takes place through loyalty programs. According to Colloquy's research, 55% of people sign up for loyalty programs to benefit from discounts.

d. Melt stock

Sometimes you can get a discount to melt down the remaining goods. In order to empty the warehouse, expand and renew the brand's product range, a discount can be made on inventory items.

Here, a concern such as increasing the sales and profit rate is more secondary. The main goal is to melt away the remaining goods.

4. 6 Different Discount Methods for Small Businesses

Once you have clarified your goal in discounting, decide what kind of discount method to use.

We have listed different types of discounts below. Remember, you don't have to stick to one type of discount. You can exchange between different discount methods.

a. Combination Discount (Bundle)

The purpose here is this: Instead of reducing the price of a single product, you can discount the price of 5-6 items sold together.

For example, white goods stores frequently benefit from such discounts for newly married couples.

We are talking about discounts for people who buy 4 products in the form of "refrigerator + washing machine + dishwasher + television".

A person who buys these products individually pays $ 11500 in total, for example, while a person who buys 4 products together pays $ 10.250.

There are some benefits of such package discounts.
The number of products sold increases once. You sell 4 items in a single order. The gain per order is higher and the cost per order is also reduced. If your goal is to sell more products, you can consider this type of bulk package discount regardless of the profit margin.

Thanks to the package discount, you can get the best selling and less selling products together. Thus, you further increase the popularity of your bestseller and dissolve the remaining product in your hand.

You can also promote your other products with this method. So some of your products may be selling more. If you make a combination of popular product + less popular product to customers, you will be marketing this second product. After this method, the popularity and therefore the price of the second product, which is weak in the marketing field, may increase. In other words, by selling a popular product and a product that is weak in advertising, you can advertise the other product.

In spite of all this, you have to decide which products to sell together. You should not make combinations according to your mind, you should research which products will be in demand together.

For example, you can examine the products that customers buy together before applying the package discount. A customer who buys a television will definitely buy a television console.

b. Prepayment discount

For example, you are a furniture store. If the production of the product that the customer wants to buy will take place only after 1 month, or if you can ship within 3 weeks at the earliest, you can make a discount for prepayers.

Prepayment generates cash flow. The customer does not care much about the delivery time and wants to benefit from the discount. As your cash will increase thanks to the prepayment, you can reduce your production costs, for example by ordering bulk goods, or you can handle your urgent payments.

For example Dropbox ...
The company, which offers monthly and annual payment options, offers a large discount to those who pay 12 months. So, for example, if the monthly purchased service is $ 10, the annual service purchased equals $ 85.

Almost all digital service companies offer this method. If you subscribe to Netflix annually, you will be at a lower cost than subscribing monthly.

If your business model is suitable for the prepayment method, can you make annual purchases for customers?

Do these people buy other products in this way with prepayment?
If there is a customer base willing to prepay for a recurring monthly service, you should be careful here. Because when this customer makes an annual payment, you have to use this money in a planned and organized manner.

c. Amount Discount

For example, marketers do this a lot. If a tomato is $ 4 a kilo, it is $ 10 per kilo. In other words, there is a discount when a large amount of purchase is made.

When you persuade customers to buy more tomatoes per order, you will finish the goods faster and your average earnings per order increase.

Especially when you go at a time close to the closing of the market, marketers can make $ 12 for 5 kilograms of a tomato, which is $ 4 a kilo, for fear that the goods will remain in their hands and rot.

d. Seasonal discount - Event discount

Seasonal and event discounts usually occur at a certain time of the year and are repeated every year. The most famous example is Black Friday. In the last days of December, many e-commerce sites, especially Amazon, offer attractive discounts.

Again, in some e-commerce sites, shipping is free in some periods, only technology or clothing products are discounted.

The selection of these dates is very important. For example, people buy gifts for each other because December is Christmas and New Year's Eve. Therefore, we can say that even a normal person does more shopping in such a month.

Likewise, in our country, we see many discount campaigns on clothes before Ramadan and on stationery products in September when schools are opened. These types of discount campaigns usually help stores to deplete their stock. You can also observe that T-shirts and shorts are sold very cheaply in Koton during the winter months.

There is a caveat, though: This type of discount is usually for those who want to buy cheap products. In other words, companies that sell products for the general public can benefit from such a discount. But luxury brands focus on loyal customers rather than customers chasing discounts. Discounts on luxury products may result in devaluation of the product to real buyers (economically comfortable people). So we can say that a psychological factor comes into play.

e. Free shipping

Some studies show that free shipping increases sales rates. When people add products to the basket and encounter the phrase "free shipping", they complete the purchase to a greater extent. According to Business Insider, high shipping costs are among the most important factors in people's abandonment of purchasing the items they put in the basket.

Free shipping is fine, but the cost of packaging and delivery is not to be overlooked. If you are working with a low profit rate and do not include the shipping cost while pricing the product, the free shipping may hurt your business.

If you want to take full advantage of the free shipping service, it is better to offer free shipping for purchases above a certain amount. So you can think of it as offering free shipping for purchases of at least $ 300.

You can also offer free shipping to purchases made within 24 hours or to purchases made within Istanbul. So you can change the parameters.

In any case, before offering free shipping, calculate in detail how this will affect your profit margin. You may be able to sell more with free shipping, but the shipping fees you will pay may melt this gain.

f. If you buy one, get the second free

Sometimes a discount is not enough to get more customers. An approach to a domain, such as a free, may be more beneficial.

According to a study published in the Journal of Marketing, many customers like to get a product for free rather than a discount. Because calculating the discount rate is relatively difficult, it is free on a free product name.

In another study, 93% of customers benefit from a buy-one-free campaign, while 73% of them benefit from a discount.

You can also apply a method like "get X for Y free" instead of one free to a field. Here, it would be in your best interest to have Y a lower cost product.

Likewise, a method such as "2 for 1 free" is quite reasonable.

This method is ideal for annealing shopping enthusiasts, dissolving stock and marketing low-popularity products. The thing to watch out for is to make sure the profit margin is in your favor.

You Should Not Compromise Your Profitability While Making Discounts

This is where the calf's tail breaks off. When discounting, your main goal is to sell more and earn more. In common words, you do not make the discount "for the sake of your father," you should not.

At this point, there are a few things to consider.

a. Profit margin

Remember that when you discount, you must make a profit from every sale. If this is not the case, you will be discounting your losses.

To keep your profit maj high;

You should lower the marketing costs. So if you are making a discount, you should also promote this discount. You don't want to see that the marketing campaign hurts your profit margin after the discount is over. So do not start a huge marketing campaign to promote your discount campaign. You can announce the discount campaign via e-mail and social media.

Likewise, direct your discount campaign to people who have never shopped from your brand before. Because a person who is constantly shopping from you is already aware of the discount, but if you reach someone who has not purchased from you before and informs about the discount, you will make an extra sale, which is exactly what you want.

In addition to discounted products, pay attention to the sale of non-discounted products. For example, give a suggestion to a customer who goes to your store and browses the discounted dress section of the clothes in the aisle without discount.

b. Customer Acquisition Cost

When you give discounts to your products, the amount you spend to get new customers changes. Add your profit margin and marketing costs that are reduced by discounts to your classic acquisition costs.

Generally, discounts do not increase your customer acquisition cost much, but to get the most out of every penny you spend on acquiring customers, you can:

Earn the loyalty of new customers. Try to turn a first-time customer into a permanent customer. In this way, the lifetime value of each customer increases. This will tolerate your customer acquisition cost.

Increase your profit margin before the new customer first purchases. So try to sell another product that does not have a discount next to a discounted product. The more a new customer spends on their first purchase, the lower your customer acquisition cost.

Make sure that customers buy the products they add to the basket. If a person does not complete the shopping after throwing a $ 150 product into the basket, it means that he or she has experienced a problem during the process. One of the ways to prevent this is to email that person when they add a product to the basket and fail to complete the purchase. So, “You added X to your cart 24 hours ago. Would you like to complete the process? " A reminder in the style of a reminder would be great.

c. Targeted Sales Volume

We mentioned that you need to set a sales target for yourself, as the main purpose of businesses that make discounts is to increase their sales volume. Don't do this goal ambiguously. Make sure your sales target contributes to maintaining and increasing your profitability.


In order for the discount campaign to be financially beneficial for your business, you must take a strategic approach and calculate the discount rate correctly. If you set out with the right plan, it is possible to earn more money by making discounts as we have repeatedly stated.