Introduction
Did you know more than 64% of online consumers wait to buy things until they go on sale? Additionally, more than 59% search for promo codes before buying anything online. (www.invespcro.com)
Put simply, online customers love discounts, and they’re more likely to to purchase because of them (duh). But let’s take the time to truly understand discounting models and approach it in a way that doesn’t compress margins.
Today, I’m going to show you the top 3 promotions I have used to help brands generate millions in revenue from their discount strategies. Let’s jump into it.
1) Tiered or Progressive Discount
The best way to increase average order value in your promotions is by creating tiered or progressive discounts. Put simply, the more the customer spends the more they save.
For example:
Spend 50+ and receive 15% off
Spend 100+ and receive 20% off
Spend 250+ and receive 25% off
or Based on quantity.
Order 3 of X receive 15% off
Order 5 of X receive 20% off
Order 12 of X receive 25% off
The main focus is to only reward customers with a higher discount when they increase the value of their cart!
2) Hidden Discount
I see this strategy rarely used but it is very creative and can be immensely valuable as long as you implement it correctly.
The idea is to run a promotion but not disclose exactly what the offer is. You are going to make the discount a surprise! With this strategy, you are requiring customers to add items to their cart and type in the coupon code before they find out how much of a discount they will receive. Essentially, requiring them to visit your store and fill up their cart before they find out!
This is powerful in two ways:
First, you are going to want to add a qualifier to this discount. For example, Receive X% off your next order of $50 or more. This will require customers to fill their cart with $50 of items before they can see the discount.
Second, you are going to get a long tail benefit of this campaign with your cart abandonment strategy.
Even those who don’t convert on the discount, should be receiving an abandoned cart email from you after the fact. This means they are getting hit twice with this offer rather than once. Additionally, you have a second time to increase their likelihood of converting because the items are already in their cart.
If you don’t have an abandoned cart email set up already, I have created a post showcasing the most successful way of handling abandoned carts.
3) Limited Time Offers
Another great way to get customers to order NOW, is to offer discounts that expire based on time.
Run a promotion with 20%, 15%, 10% that expire in 60, 90, 120 min respectively. Shopify makes it easy to schedule these promotions. Just have them start and expire at a certain day and time.
I have seen tremendous success from these campaigns but there can be some drawbacks.
First of all you will need to segment your audience based on time zones and create separate coupon codes and emails/SMS based on time zones. Additionally, there can be a lot of frustration from those customers who missed the offer. I typically will recommend that the lowest tier remain available for at least 24 hours to keep customers who missed the offer satisfied.
Conclusion
So these are the best promotional strategies that I have used with clients to generate millions of dollars in sales. Utilize these strategies on your Shopify store to increase average order value, customer lifetime value and go and grow your Shopify.
Now go and grow
Recommended Apps:
Klaviyo is one of the most popular and one of the most powerful email marketing softwares available for Shopify. With endless options and integrations, Klaviyo is a powerhouse option for email (and SMS) marketing.
Postscripts is one of the best and one of the most powerful SMS marketing softwares available for Shopify. Postscripts can help you with all SMS promotions listed above!
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