I was reading some articles recently that were discussing the pros and cons of “sales” in service based industries. One company in particular caught my attention – a boutique photo studio. The owner was discussing that the benefits of having a sale was the increased traffic into the studio, and higher name recognition. The cons of the sale was that the clientele that was attracted to the service was less loyal, only looking for the best price for the service, and aren’t truly concerned with the quality of the service provided.
How often do we run into the same issue – in order to attract new clients, we feel we have to offer discounts on our pricing to hook them. By continuing to offer discounts and other promotions, we tend to devalue our services and we end up getting new clients who will leave when they find a similar service at a better price. This also deters current and past clients from utilizing your services as they know that eventually you will put out a promotion or discount on your services and they will just wait for that to come around.
After reading these articles, I came to this conclusion: The decision to discount may lead to the devaluation of the service you offer, and the devaluation of your brand.
So how do we rectify this devaluation and client perception of our services? It comes down to these few basic principles:
- Have a clear understanding of who your ideal client is
- Create a plan to market your services to them without discounting your services
- Make sure your business model has a plan for client retention. If you can keep your best clients as loyal clients, you won’t have the same advertising costs in order to attract new clients. It is always cheaper to keep an existing client than try to get new ones.
Now, having said that, is it wrong to have a promotion? Of course not. Sales and discounts can be used for rapid new business growth, and retention efforts. Timing is key though for these promotions. If you are offering a different promotion every week, or every month, you are training your prospects to wait on buying since they know that if they do, a better deal might come along – and we don’t want that to happen. Use your promotions to create a sense of urgency and only offer it for a limited time. Evaluate the impact of the offer you ran against normal business. Was there a serious lift in business? Did you create lasting clients? If there wasn’t a noticeable difference, or the clients didn’t last, was the offer worth running? These are just a few questions to think of as you move forward.
I’d like to sign off with this last thought: Don’t sacrifice your brand or your business through quick revenue generating offers. The devaluation of your services isn’t worth it in the long run.
TeleContact Resource Services has been in business since 1994, and has served over 3,000 clients. If you are interested in the marketing services that they offer, give them a call at 800-551-0567.