Everyone in the business world wants more sales. With more sales comes more money that helps in growing an organization. But what is the big problem in reducing the price to increase sales? Why is not this desirable? Because this affects the profit margin of a company.
Reducing the price can help you get sales in the short term, but in the long run, it will hurt profitability. Consider Amazon, the e-commerce giant, as an example. They regularly cut prices aggressively to attract and retain customers.
While price reduction may be a fair strategy for someone like Amazon, but for a small business, this can have a disastrous impact on sustainability. Therefore, for small businesses, retailers, startups and home-based entrepreneurs, reducing the price to increase sales is not a viable option.
But one thing is for sure. The price reduction is the fastest way to increase sales. If you have secured the financing, consider lowering the price to quickly acquire the initial customers. This is what most software startups do to gain traction initially.
In this post, we’ll talk about 10 unique strategies to increase sales without lowering the price.
How To Increase Sales Without Reducing Price Or Discount
- Contact Existing Customers
Did you know that your current customers are your biggest source of future sales? Yes, they are. They are the people who can make or break your business. And, more importantly, they know you and your company. So why not get more sales?
Most companies make this mistake of focusing too much on potential customers instead of existing customers. So please do not make that mistake. Get in touch with your existing customers with your new product or offer. Communicate and listen to them. Of course, chances are they will rearrange things.
This strategy is best suited for service companies.
Take an example: imagine that you are in a corporate catering company and launched a new banquet service. To start the new vertical, go and offer your new service to your existing catering clients. This way you have chances of conversion (for your new vertical service).
- Start a reference program
What if each of your customers presents and received start referring to a new customer? Well, then your number of customers would double! And probably your sales too.
Then start a reference program now.
You can either set up the reference program manually or find reliable reference management software. Give the indicated clients an incentive, gift or year-end award. The referral program strategy seems to work best for online business, e-commerce, and SaaS.
- Supplementary Products or Cross-Selling Services
What if you offer supplemental products or services to your customers, users, and customers?
Chances are high that they will buy it because the supplemental product or services would be related to the original product. Amazon defines this strategy as a king. See the next image where a guitar is an original product and a guitar tripod is a related product.
This strategy works equally well for all types of businesses and services.
Take an example: Imagine you’re a financial advisor offering tax services to a specific customer. How do you increase sales? Just get in touch with this customer and offer your other complementary services such as accounting, internal audit, asset management, etc.
- Put your product strategically
This strategy works best for retail or physical stores. What happens when you put your target product right next to a similar product at a high price? Yes, you’re right. It becomes easier to sell the target product.
Take an example: if a $ 200 guitar is placed next to a $ 2000 guitar, then the $ 200 guitar has a great chance of being sold.
This pricing strategy is also known as Price Anchoring and is commonly used by marketers around the world. Now, you must be wondering why this works. It’s all about psychology. The human mind is prepared to compare numbers and make decisions (especially when it comes to buying or buying things).
- Do not charge shipping fee separately
What if you include the shipping charge directly in the price of your product and display your shipping charge as “FREE”? Well, sales would probably jump.
Take an example: If you are selling a wristwatch at $ 100 and charging $ 20 as a shipping fee, try to include the shipping fee in the product price to make $ 120. It displays the shipping fee as “FREE”. This strategy works because buyers generally do not mind paying for the product, but they hate anything else.
Needless to say, this pricing strategy works best for e-commerce companies.
- Subscription Offer
Instead of a direct sale, and if you offer your product or service for a periodic subscription fee? Yes, because of accessibility, more customers would buy your products or services.
From the customer’s point of view, the advantages of choosing a subscription by off-the-clock purchase are as follows:
- Accessible
- Less risk
From the seller’s point of view, the subscription revenue model has the following advantages:
- Increased sales
- Recurring Cash Flow
This strategy is usually followed by SaaS companies. Here’s the Slack example:
- subscription
It is not that this pricing model works only in the case of a SaaS company. Case in point: Cort, an online furniture retailer offers furniture for rent.
- Re-Jig the price display
As a customer, which of the following prices attracts you the most:
$ 199.00
$ 199
US $ 199 (previous US $ 499)
Of course, the third is the most attractive. Because?. Because it gives you the feeling that you’re getting a lot and it’s simple too (no decimals like the first).
This is perhaps the simplest strategy to increase sales without lowering the price instantly. In addition, it is also very effective.
Unlike other strategies, this can fit into any type of business model or revenue.
- Deliver high-level customer service
Jack Ma, the famous founder of the Alibaba group, had already said:
Never compete on prices, instead of competing on services and innovation.
The excellent customer experience can not only help your company get more sales but also charge a premium price. And this strategy is the one pioneered by technology giant Apple Inc.
Word of mouth is still one of the most effective marketing channels and high-end customer service helps you with just that.
When your existing customers get a good customer experience, they do the following:
- Disclose how incredible your service is
- Tell your friends and colleagues
- Talk about your business on social networks
All of the above will help you get more customers at no cost. And more customers mean more sales.
But why does this happen?. Why do customers yearn for good customer service? It’s because it makes them feel important. Everyone wants attention and with good customer service, you get one.
In addition to increased sales, good customer experience helps build an army of loyal fans and brand building.
Obviously, this strategy can be applied to all types of companies and organizations.
- Partner with a business
A business partnership is a proven way to get qualified customers quickly.
Take an example: If you are on business trips, then why not tie up with a wedding planner? This arrangement will ensure that the wedding planner provides you with highly qualified leads (newly married couples) to boost your sales.
This strategy is used again by leading brands. Take the case of the partnership between Apple and Nike since the early 2000s. Obviously, this strategy involves an affiliate payment to the reference business. And that affiliate payment can be in the form of money or some other form, such as a reverse referral.
In addition to increased sales, business partnerships also help in:
- Improving the industry network
- Build brand
- Learn Referral Business Best Practices
The good thing about this strategy is that it works well in all business or service sectors.
- Collect Faster Outstanding Debts
This is perhaps the most underrated strategy among all.
Did you know that simple tracking can help you recover debts faster from your commercial debtors? Yes, you can.
But what is the advantage of recovering faster in terms of sales? Simple. The faster collection of debts implies a faster reordering of customers (debtors). And faster-re-ordering results in faster sales.
Thus, the sales frequency increases if you follow up with the business debtors in a timely manner. Needless to say, increasing frequency means increased sales.
Take an example: imagine. one of your business debtors takes 30 days to clear an invoice. What if you follow up frequently and ultimately bring down the credit period from 30 days to 20 days? This can result in a reorder 10 days faster or sooner!
This strategy works best in B2B and wholesale distribution companies.
Conclusion
We have our 10 strategies to increase sales without lowering the price covered.
Each of the ideas discussed is easy and quick to implement. Also, none of the ideas is expensive to execute.
