Two recent incidents got me thinking what it means to my customers when I offer them a discount.
#1
Kenji, a long-term hair stylist in my community announced on Facebook that he would offer for a limited time, discount to CX and CX Dragon families who have lost their jobs. A 30% discount is huge for a small business. Kenji didn’t have to but he did, out of genuine care for the community and families whose lives have turned upside down. The money saved aren’t going to be enough to pay the bills but the love and care his action has displayed is immeasurable. My husband didn’t need a haircut but he booked one anyway. I even made my fussy teenage boy go. I have no doubt in my mind that Kenji has now earned a very good reputation, with a following of loyal customers.
#2
At another business, let’s call it “B”, while settling a much bigger bill, my husband was notified that because he was no longer a CX employee, we would not be extended the usual 5% discount in the future. To hear that when he was about to leave the premise made it feel like a breakup. We didn’t choose this service provider for the discount to begin with but we are going to consider other options after this incident. Was it necessary for the service provider to clarify the discount rule – Yes. Was it necessary to clarify it there and then – No. It was a right message delivered at a wrong time and place.
To the receiving end, the savings from both service providers were insignificant. The decision to use their services wasn’t based on the discounts (or lack of). If the discount wasn’t even a decision criteria, why did it matter that they were offered or taken away?
It matter because…
Timing changes everything!
I cannot emphasise enough the importance of timing the discount offer. Like many others in the community, we chose B because of its convenient location and quality. We weren’t aware of the discount until we booked them for the first time. So in a way, B gave away something for nothing. The discount would have been a lot more meaningful and appreciated if it were offered today.
Do you tend to offer discounts too freely? Are you getting something in return for your discounts?
You are sending a message!
While a large group in the community was going through a crisis, Kenji was quick to offer a big discount while B took away a small one. Kenji has shown that he cared about his customers and offered help the way he could. In comparison, B has shown that they didn’t care about their customers.
What are you really saying when you offer a discount? Are you saying “I’m only offering it so I can get your business” or “I am doing what I can to help you get what you need.”?
Author:
Eva Lam
Tree Consulting Asia Company Limited