Ask any small business owner about his or her No. 1 priority, and the answer will likely be growing the business.
Among the myriad of marketing techniques available to help businesses expand, promotions are an indispensable tool. Promotions can come in all shapes and sizes — from the classic buy one, get one (BOGO) to discounts on shipping. If run effectively, they can have a rapid impact on your business, drive existing customers to make additional purchases, and become a key mechanism for acquiring new customers.
So why aren’t you running one?
It turns out these types of offers have a bad rap. Here are three common misperceptions about running a promotion.
Myth 1: It cheapens a product or service.
Promotions don’t need to cheapen the perception of your product or service, but it is important to align the style and type of your promotion with the nature of your business. Benchmark other companies in your category for ideas and make sure that the offer and the way the offer is delivered to your customers is consistent with your audience.
Myth 2: You have to give away the farm.
The best promotions are compelling to consumers but also make sense to the business. Effective promotions don’t require “crazy” pricing or massive giveaways. Done well, promotions can be exciting to consumers and have a positive impact on the bottom line.
Myth 3: Promotions are a hassle.
Strong promotions shouldn’t be complicated; they should be easy for consumers to understand and equally easy to execute on your end. Coupons, offer codes, bundled product sets, and time-based promotions can be some of the easiest mechanisms to ensure your promo comes off without a hitch.
So how can you make sure your promotions actually deliver results? Here are four ways to get started.
The core of good promotion is a compelling offer. What qualifies as compelling is always a bit subjective, but the offer needs to be perceived as compelling by potential consumers and likely to drive a rapid response. A promotion with a lot of advertising behind it but a weak offer is likely to underperform. Often it’s useful to socialize offers with a small subset of customers, even in an informal way, to gather feedback and shape the optimal offer for your entire audience.
Connect to Your Core
There should be a clear connection between the type of promotion you run and what ultimately drives your business. For example, this could mean offering a deal on your flagship products or services that drive lifetime value and loyalty. Even in situations where you may test promotions on your periphery offerings, there should be a strategic vision to get customers to connect with your core business.
Mix It up and Test Often
Promotions by nature are short-term, which allows for a degree of freedom. The businesses that are most effective with promotions mix it up, featuring different products and services in a variety of ways throughout the year to see what works best. The key is to experiment, try different approaches, measure the results, and continuously optimize your promotions.
Don’t Overdo It
Good promotions work, but there is a danger creating “offer fatigue,” where customers perceive there is always a sale happening, if you run them too often. This can train buyers to not purchase your product or service unless there is a promotion happening. Be wise about the frequency and duration of your special offers so they stay, well, special.
The takeaway: promotions can play an important role in the growth of your businesses if you focus on compelling offers, regular testing, and customer feedback.