Discounts are poison in sugar coating
Discounts are poison in sugar coating
When brand performance is declining, companies often use high discounts to rescue revenue. When companies or brands taste the sweetness brought by discounts, they tend to ignore the last line of defense of product price control mechanism and commodity gross profit margin. The turnover is often very high, but the gross profit margin is almost eaten up by discount activities, and consumers are like taking drugs. When the original price of the product is 50 yuan and the price is reduced to 25 yuan, consumers will be affected by the anchoring effect. When the product returns to 50 yuan, consumers' willingness to pay is greatly reduced. Only when it returns to 25 yuan or lower will consumers be willing to come back to buy. Discount activities do not have a perfect mechanism and often damage brand value.
When brand performance is declining, companies often use high discounts to rescue revenue. When companies or brands taste the sweetness brought by discounts, they tend to ignore the last line of defense of product price control mechanism and commodity gross profit margin. The turnover is often very high, but the gross profit margin is almost eaten up by discount activities, and consumers are like taking drugs. When the original price of the product is 50 yuan and the price is reduced to 25 yuan, consumers will be affected by the anchoring effect. When the product returns to 50 yuan, consumers' willingness to pay is greatly reduced. Only when it returns to 25 yuan or lower will consumers be willing to come back to buy. Discount activities do not have a perfect mechanism and often damage brand value.
When brand performance is declining, companies often use high discounts to rescue revenue. When companies or brands taste the sweetness brought by discounts, they tend to ignore the last line of defense of product price control mechanism and commodity gross profit margin. The turnover is often very high, but the gross profit margin is almost eaten up by discount activities, and consumers are like taking drugs. When the original price of the product is 50 yuan and the price is reduced to 25 yuan, consumers will be affected by the anchoring effect. When the product returns to 50 yuan, consumers' willingness to pay is greatly reduced. Only when it returns to 25 yuan or lower will consumers be willing to come back to buy. Discount activities do not have a perfect mechanism and often damage brand value.
Plan an event that does not undermine brand value
If a company or brand wants to stimulate consumers to shop, discounts are not the only way to make consumers want to shop. "Cross-industry cooperation" or "co-branding" with other brands to reach consumers in different fields, while increasing online discussion and popularity is also one of the ways. Or, exclusive products can be made for free to highlight the uniqueness of the products, stimulating consumers to consume and redeem gifts. Brands need long-term operation and member management to find loyal fans among many members. In times of economic downturn, these loyal fans may be the right-hand man to save the company or brand.
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