What is a more effective discounting strategy: 15% off or two for $15? If you picked the latter you are correct.
Quantity discounts are incentives offered to buyers that decrease cost per unit of goods when more products are purchased. Research shows that when pricing is presented in quantity terms (buy two or more) sales rise by 165%. Simple discounts, like a percentage off, only increase sales by $125%.
The primary advantage of a quantity discount is that the reduced per-unit price encourages customers to order in larger quantities. When they do so, the seller makes higher revenues per transaction. This strategy is perfect for decorated goods, considering how quantity affects costs and pricing.
JP Hunt is a founder and partner at InkSoft, Albuquerque, N.M. He is in charge of sales and marketing. He can be contacted at [email protected]. For more information, visit inksoft.com.
