At some point we’ll have to define discounting.
Does “early bird” pricing count? Does bundling products together for a lower total price count? If you’re coming from a place of gratitude, does that make a difference?
Is it as simple as: discounting is fine, works well, and doesn’t hurt you if you do it just right, infrequently enough, and always attach a good reason as to why you’re offering a discount?
Discounting as bad for you, but good for users?
I’ve always thought of discounting as something that’s bad for you, but neutral or good for your users.
Except when Nordstrom Rack sells a dress for $79 that’s been marked down from $399 to $199 and now to $79 for the summer sale.
What a steal! That wasn’t the plan all along, right? They’re being awesome and you’re just getting all that value.
Not discounting as people getting what they pay for
And then there is that popular objection to that idea: that people value what they pay for.
If someone spends $2,700 on your flagship course, that investment is not something they will take lightly, and they will be more likely to value, consume the content, and actually apply it.
Meh. I’m sure there is something to that. I’ve noticed it work in my own life. I did get a little too annoyed the first time my new car got scratched.
And we do see the reverse at work in pricing research.
When a user is presented with a percentage discount, they devalue the product, associating it with the new discount price. It’s called base value neglect and I wrote about it here before.
Not discounting as protecting the relationship with your list
Discussing discounts, price theory, and consumer purchasing journeys, it all gets so impersonal and transactional. It becomes about business and is akin to negotiation.
Okay, you’ve been on the sidelines about my stuff for a while now. Let’s get this deal done, how about 10% off? 20? What’s it going to take?
On the not being transactional approach, there is also an identity component at work.
If someone is deciding on your flagship course at a high-ticket price, they’re acknowledging and strengthening a relationship between you and them.
As consideration becomes decision, they’re feeling things: “I believe you,” I trust you,” I think you can help me.”
It gets intimate.
Then they check their inbox and see your subject line.
John Jacob Jingle… HURRY! GET 30% OFF UNTIL MIDNIGHT! 7:02AM
You’re a personal brand. You’re in this process of relationship and rapport building. And now you’ve just cheapened that relationship by making it about the money.
Which, I guess, is fine if it really is all about the money.