If companies want to drive sales as much as possible, why do they offer customers deals and incentives that don’t seem to benefit them as sellers? There are several reasons why these companies want to put together great deals for their customers. Companies always look for ways to attract and keep customers in today’s competitive marketplace. One of the most common strategies they use is offering deals to consumers. But have you ever wondered why companies do this?
Let’s take a look at some of the main ones.
Contents
Attracting New Customers
One of the main reasons companies offer deals is to bring in new customers. When a business offers a discount or special promotion, it catches people’s attention. For example, a new coffee shop might offer a “buy one, get one free” deal on lattes. This encourages people to try their coffee without spending too much money. Once customers have tried and liked the product, they’re more likely to return, even when the deal ends.
Inspire Brand Loyalty
It is rarer to find true brand loyalty than we used to see. Once upon a time, people would choose a brand and then stick to them. It would take a lot to get someone to switch their allegiances.
Nowadays, people prefer to shop around a little. Whether they are choosing a company because of their ethical stances or because they have carefully rated them against competitors, consumers might have a long list of things that they want to see from a brand.
A company needs to demonstrate that it is a brand worth investing in. In addition to offering good service and products, one way they can do so is by offering good deals to the customers who spend a long time shopping with them.
Clearing Out Inventory
Sometimes, companies offer deals because they need to eliminate certain products. This could be because the items are going out of season or because newer versions are coming in. By offering discounts, companies can sell them quickly and make room for new stock. This is why you often see big sales at the end of seasons, like winter coat sales in early spring.
Testing Out Something New
Brands need to put the feelers out and see if something they have planned will work. They might have a plan, but first, they want to see what the reception might be if they take things forward.
For example, players might receive an offer for two slots NetBet has added to their site. The company might then measure which game their audience prefers, and from this, they will be able to gain lots of information they can use for further campaigns. Small reviews such as this are incredibly important for helping brands gain insight into their audience to create better marketing materials.
Competing with Other Businesses
In many industries, competition is fierce. Companies often use deals as a way to stand out from their rivals. If one company offers a good deal, others might follow suit to avoid losing customers. This can lead to a cycle of deals that benefit consumers. For example, if one cell phone company offers a discount on their monthly plans, others might match or beat that offer to keep their customers from switching.
Increasing Sales During Slow Periods
Every business has times when sales are slower. Companies often turn to deals and promotions to boost sales during these periods. This could be a restaurant offering lunch specials during typically quiet afternoon hours or a theme park offering discounted tickets during their off-season. These deals help bring in customers when the business would otherwise be slow.
The Impact of Deals on Consumers and Companies
To better understand the effects of deals, let’s look at a simple comparison:
| Without Deals | With Deals |
|---|---|
| Fewer new customers | More new customers |
| Lower customer loyalty | Higher customer loyalty |
| Slower inventory turnover | Faster inventory turnover |
| Less competitive edge | More competitive edge |
| Steady sales patterns | Ability to boost slow periods |
| Limited brand awareness | Increased brand awareness |
As we can see, offering deals can have a big impact on a company’s success. However, it’s important to note that deals aren’t always good for businesses. If a company offers too many discounts, it might train customers only to buy when there’s a sale. This can hurt profits in the long run. Companies need to find a balance between offering attractive deals and maintaining their bottom line.
To Drum Up Excitement
Is the brand in the run-up to a big event? It could be something seasonal, such as Christmas, or something unique to the brand, like an anniversary. They will want to get as much excitement as possible so that, at the big event, they will have a good audience paying attention to them.
You will often find great deals in the run-up to such an event. These brands will either push out great deals at this point, or they might tease something coming further down the line.
If you are interested in what a brand will offer you as a consumer, you only need to look as far as their deals. A good company will always want to give something back to the consumers who stick with them. What’s more, they can learn a lot about their customers based on which deals are most popular. Even with something like discounted bundles – take a look to see which goes first. You might be surprised to find out how people react to different offers when a company presents them with them!
FAQs
Are deals always good for customers?
Do companies lose money on deals?
Why do some companies rarely offer deals?
Are online deals better than in-store deals?
How can I find the best deals?
Do deals make people loyal to a brand?
Final Thoughts
Companies offer deals to consumers for a variety of reasons. These include attracting new customers, building loyalty, managing inventory, competing with rivals, boosting slow periods, and increasing brand awareness. While deals can be a powerful tool for businesses, they must be used wisely to ensure they benefit both the company and the consumer. Next time you see a great deal, you’ll better understand why that company might be offering it!
