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"70% off" promotions

Greetings,

I wonder does anybody here can share an experience or thoughts about  making time limited sales with huge discounts, like -70%?

I noticed that when I  myself  purchased  2 software packages on similar one time promotions.

In these 2 cases it was a software I was potentially interested, but not too much. I was reluctant to to spend a few hundreds on it. But when I receive an email with  70% discount I bought these  software packages.

As a potential drawback of such sales I see the lowering of the perceived value of the software.

What do you feel when you receive such promotion offers?
MatrixFailure Send private email
Thursday, May 22, 2014
 
 
I would think that the product is no longer being actively developed. Perhaps there is a newer product under a different name that does the same and more.

Corel does huge discounts on such old products; I bought their Painter Essentials 4 for $18 a few months ago. It was last updated in 2011.
Dmitry Leskov Send private email
Thursday, May 22, 2014
 
 
I agree with Dmitry, it wreaks of something no longer in use, like out of style clothing. 

There are better techniques to increase sales such as targeting customers directly in a place with free audiences such as Craigslists.  Or generating free courses or webinars as sales leads to your product.
Mike Grossman Send private email
Thursday, May 22, 2014
 
 
Also, less than optimum for your existing customers, who are likely to develop buyer's remorse pretty quickly if they happen to see the discount offer.
Scorpio Send private email
Thursday, May 22, 2014
 
 
If offering any discount it's best to give a reason WHY you're discounting.

Almost anything will do but you have to have a reason, such as Valentine's Day, because they're on your mailing list, because there's an M in the month, whatever.

At 70% you need a darn good reason!

It works because we're more motivated by the fear of loss than by the anticipated pleasure of gain, so 70% for a very limited period works. For longer periods it doesn't work so well, if at all, as it just devalues the product and makes a mockery of the official price.

So as a rough guide:

1. Make sure you have a large audience, such as a lot of traffic, an email blast to a good list, direct mail to the right market or whatever.

2. Give a darn good reason why it's so heavily discounted

3. Restrict the length of time it's available at that price - and stick to it.


Make sure you're still getting a positive ROI, or at least neutral. Also be aware that even if they only paid 30% the new customers are still entitled to and expect technical support, discounted updates etc etc.

In short, such mega-deals are worth doing now and then, if you do it carefully.

What you should NOT do is just slash the price on your website as an experiment. The various downsides far outweigh any short-term boost in (low-priced) sales.



AC
Reluctantlyregistered Send private email
Thursday, May 22, 2014
 
 
I would suggest that instead of doing a 70% off promotion for many days on your website and to existing customers, you do a one day promotion on BitsDuJour.

Since you are doing only for one day, you don't reduce the perceived value. And you target more number of audience. You will get more sales this way.
Gautam Jain Send private email
Friday, May 23, 2014
 
 
Thanks for your suggestions.
Actually I don't really think Bits Do Jour will fit to my case because, my program is for quite an narrow niche. In addition I have a mailing list of users who trialled but not purchased the program.
MatrixFailure Send private email
Friday, May 23, 2014
 
 
What AC said.

I also would think that the software isn't developed (or supported) anymore. A 70% off deal always sounds suspicious to me, but that's only me.

I will only add that, before you go for the huge discount, you should determine what's the benefit for you: What do you want to achieve? Do you want to grow the number of customers? Why? etc.

> In addition I have a mailing list of users who trialled but not purchased the program.

Be careful giving 70% off to this list. First, because it sounds like: "You tried my software and you didn't like it, but please, please buy it! Here, it's super cheap!" and, second, because you might attract the "cheap customers", who will buy it and then abuse you for support (been there myself).

—Gergana
SansMagic Send private email
Tuesday, May 27, 2014
 
 
I recall reading a study about the following approach to handling the trial users that did not purchase, provided you have their emails:

1. Offer them and exclusive (i.e. not featured anywhere else) discount for a limited time, which can be from 24 hours to several weeks, depending on how far above the "impulse purchase" range your product price is.

2. To those who neither purchased nor asked to be put off the list, offer a smaller discount for the same period.

3. Repeat once more with an even smaller discount.

You can then put the list aside until maybe you have a major feature release.

The study stated that it is sufficient to use 20%/15%/10% discounts and most purchases happen at stages 1 and 2.

(If you are selling a B2B product, you may wish to filter out trial users from corporations and government agencies - they are not price-sensitive in most cases.)
Dmitry Leskov @Home Send private email
Saturday, May 31, 2014
 
 

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