Closing a sale is easier if you have instilled a sense of urgency in the customer. If you can’t create the “I need this now” urgency, you can create urgency by offering a time-limited promotion that expires if they don’t act on it in a quick enough time window.
If product risk is an issue, you can also offer special promotions to offset this risk. Product launch pricing, “pay tomorrow” offers, or product financing can help reduce the acute cost of the sale without
You get what you get. Straightforward offers may not add much promotional “sizzle” to pricing, but straightforward pricing may also offer clarity, consistency, and ease-of-mind to a purchasing decision.
Chevrolet’s Employee Discount for Everyone campaign did a lot to temporarily stimulate sales because it took the gamesmanship famous in car sales out of the sales process. How could you do better than the salesperson could do for their own family?
You bring the food, they don’t pay until after they eat. This offer style is attractive because it offers instant gratification with deferred pain, and because it is a costly and credible signal that you’re going to love the product and not want to return it.
Prospect theory tells us that people like immediate gratification and are delusional optimists because benefits in the short term can look bigger than they really are. It also tells us that people like to procrastinate, because pain tomorrow is better than pain today.
Keep in mind, of course, that this model can create new problems for you, including an asset intensity problem, collections problems, or problems with involuntary churn. But these risks are the cost that make this signal credible.
New products might be priced differently because they’re new. If you’re purchasing a new product in a new category, you might get special pricing to reward you for being an early adopter.
A product launch “discount” can be non-monetary. If you are selling a video game or other experience good, you may be forced to sell the product for the very highest price on day 1 of launch—but can reward pre-order customers with special DLC, free gifts, or other rewards.
The first 100 purchasers get something special. This pricing is available “while supplies last.”
This creates urgency because the customer has no idea how long it will take the business to sell to 100 customers. It’s a kind of limited-time offer, but the customer (and business) doesn’t know when the time is limited to.
For new products or products with no inherent limit to quanity, this kind of offer can create conflicts related to timing and information. As a customer, if I think that there’s no chance that I’ll be within the first 100 purchasers, why would I change my purchasing behavior? If I’m within the first 100 purchasers but didn’t purchase in the first day or two, is that a bad sign about this business? Could my competitors benefit from understanding how long it takes us to sell 100 customers? And if it’s longer than expected, will customers think that you’re acting with integrity—or are you just running a promotion for as long as you feel like it?
For products at the end of their lifecycle, this offer is a kind of clearance. Items may be marked down to clear them from inventory, and they won’t be back.
Act before Monday! This creates a similar urgency to the limited supply offer, but with a firmer deadline.
We don’t offer this to just anybody—if you apply, we may accept you, and the fee is $10,000. This kind of offer can be effective for events. Be careful: first-degree price discrimination (in this case, making special pricing available on an application basis) can be dicey.
This is related to the the “Buy Today, Pay Tomorrow” Offer. In this scheme, you get the product now, but pay gradually. Like Buy Today, Pay Tomorrow, it comes with collections and asset intensity risk, as you need to trust that someone will reliably pay you in the future. Working with a financing company that can underwrite that risk can help both the business and the consumer.
“If you buy the fancy tires with your brand new car, we can offer them for 30% off. If you wait, we have to offer them at full price.”
The one-time offer creates scarcity around the point of purchase. The discount window opens when you begin the purchase, and closes when you put your wallet away. This is arguably the most “high pressure” tactic because a customer not expecting this will not have time to do any research.
The most important thing is that you actually enforce it! If a customer has reason to doubt the actual constraint, it won’t work.
Hat tip: Ray Edwards’ lovely book, How to Write Copy that Sells