The correct answer is: It all depends.
Here are a few things to consider before committing to a seasonal sales event:
1. If you sell a ‘seasonal’ product, the answer is no
Your advertising efforts should focus on the benefits of your product or service. Remember: sustained price-point advertising trains customers to shop for the price, not the best value. Best price is not a brand loyalty anchor.
If your product is out of season, predictable end of season discount sales and buy-some-get-some events can also do more harm than good by discounting today’s inventory at the expense of tomorrow’s full mark-up. Think automotive rebates for a moment. In spring, summer, fall and winter, discounting is so predictable and pervasive that a new vehicle’s MSRP has become meaningless. Computer and mobile devices are following suit.
2. Create a benefit over and above price
Is your sales event designed to move your excess inventory, or are you really trying to improve the lives of your customers and those they could refer to your business? While this may sound dumb, it’s actually sound advice designed to protect your business, and your profit margins from price shoppers who have no brand or store loyalty. Countless consumer-use and attitude research studies have found that price is NOT the key determinate for product or service selection. Think accountants, lawyers and plumbers.
3. Price is a ‘catch-phrase’ for the more complex value proposition
When a person walks into a clean, well organized store, is greeted promptly and sincerely, served by smart, engaged, well informed employees, offered a range of product choices with pros and cons that are easy to understand, and supported by after-sales support, the odds of a customer saying that the product or service is ‘priced well’ increases dramatically. What the customer is really saying is “this is a really great value proposition.” The collateral benefit of the customer feeling good about their purchase decision includes:
- Repeat purchases
- Increased likelihood of trying and buying related products or services
- Casual referrals to friends and family
- Active referrals to try your products or services
Think Mountain Equipment Co-op vs. Giant Tiger.
4. Keep your brand top of mind during the off-season
A variety of American on and offline business media research studies conducted between 1965 and 2005 have determined that the sales of brands that continue to advertise (albeit at reduced levels) during recessionary times rebound faster and further after the recession than those that stop advertising altogether (to save money short term). The lesson for both large and small advertisers is clear: doing some brand advertising during recessionary times, or in the off-season, helps to keep your brand top of mind and on the mental shortlist of your customers.
Tough times never last – but tough brands do.
Not sure what to do and when? Call us at 204-474-1654. We’ll help you sort things out!