We’re only a quarter into 2020, and already markets are praying for an end to retail agony. Understandably so, given the coronavirus-related chaos currently surrounding us.
Purple Dot has a workable solution for you – one that will let you turn retail discounting from pain to power if you’re prepared for the kind of innovation that can drive a paradigm shift.
Let’s be clear. This year, UK retailers will lose over £38bn in potential revenue by way of poorly managed mark-down sales. Just to put that in context, that’s the cost of around 60 hospitals, or £10Bn more than Jeff Bezos’ divorce.
Worse still, the majority of retailers don’t believe that their current systems can manage these losses. Instead, they believe their current systems lack the capacity to mitigate the loss of revenue on discounted sales of marked-down goods.
A Race to the Bottom: the Old Deep Discount Drill
If you’re a retailer, you know the drill.
Even before you've even got the new season on display, shoppers are asking about sales. Competitors offer larger mark-downs earlier every season. As deep discounts become increasingly common, some of your customers refuse to buy anything at full price.
You feel forced into a race to the bottom for your products. You can’t seem to escape the charge toward the negative margins that have already put so many out of business.
You’re not alone.
At Purple Dot, we hear this time and time again from retailers and it shows in their figures – and your own. Take a look at your web traffic by page to see your customers heading for those 40%, 60%, and even 75% deep discounts.
Terrifying and potentially disastrous.
Something for the Pain: Purple Dot to the Rescue
It's a bleak picture, but it doesn't have to be.
Discounting is not going away. As a retailer, you just need a new means of deploying it more effectively. The good news is that when your discounting practices get smarter, you get more from the customer base you already have.
Done properly, discounting is not all about the shopper chasing the “60% off” items in your sale section. Nor is it concerned with the customers who have no interest in being return buyers and don't care about the sustainability of your business.
When handled well, discounting is a powerful tool to bring your loyal customers back and create new ones. It becomes a means to give them a treat or persuade someone who is undecided to make a purchase right away.
Purple Dot shows you the way and simplifies the process with our proprietary technology.
Time to Abandon Those Painful Discounting Cycles Forever
‘to improve their long-term outlook, brands will need to tailor future discounting strategies”.
Planet Retail strongly recommends that retailers of all sizes abandon cynical discounting for its own sake, and also abandon following the herd during events like Black Friday and Cyber Monday. Instead, they recommend that retailers adopt more advanced, integrated retail business software.
This strategy is about approaching discounting differently, and we already see industries like travel embracing this approach.
Travel retailers don’t think of discounting in a seasonal or event-driven way. Instead, they continually price, or dual price, their products in innovative ways to maximise their revenue.
Just think about last time you bought a flight (even if this seems like a distant memory in the grip of the Coronavirus crisis). Did you feel you had to wait until Black Friday to buy it in order to get a great deal?
It may sound bold, but it’s necessary. For your revenue’s sake, it’s time to move away from deep discounts and embrace smarter discounts. Save yourself that precious margin, keep hold of that brand equity you’ve worked so hard to build, and convert more of the shoppers you’ve already managed to draw to your website.
The future of your business depends on it.
If all this sounds a bit scary, don’t worry. At Purple Dot, we're making a new way for you to offer your customers discounts, and we've made our tech super easy to integrate it into your website.
So Tell Me How It Works Already
We’ll do better than that.
We’ll show you. Just visit our What Is Purple Dot? page for a video and clear explanations of what we’re offering and how we can help.
One more time: let’s be clear. The situation in retail markets, whether local, regional, or national, is already critical. We can’t be certain how long the current problems will last – not for ourselves and not for our trading partners.
But we do know this: things won’t return to normal anytime soon.
This means you don’t have time to fool around with traditional discounting strategies that are clearly losing propositions. So, go through our website, and then reach out to us. You can talk with us by email, phone, or live chat about how Purple Dot can save you from the disaster of cyclic discounting.
Just look at your figures. There’s no time to lose.