Discover more from The Mmm...Letter
Nobody's Perfect Edition
Let’s look once again at price, and the morality of price-setting.
In the previous post, I laid out the case against discounting. In large part, weary marketers rely on discounts like crack-babies rely on, well, crack I’m afraid. However, there are perfectly natural times where discounts are both moral and a boon to our business.
Previously, I gave the greenlight to personal discounts and discounts on previously-used or open-box items, as per the unwritten social contract (unless the item was previously used by Elvis, Lincoln, or a Kardashian). There are two more discount types that fall well within the bounds of moral marketing behavior.
You’re Getting Old, Man
The first discount I sloppily glazed over in my previous treatise was the aging discount, and no, I’m not talking about early-bird special… yet. When stock sits on the shelf too long, including non-perishable, it depreciates. A social-proof mechanism guarantees that an unwanted item remains unwanted. If our products are suffering from disinterest, it’s a tell-tale sign that either it had no place in the market to begin with or we mispriced it.
As products age, even those such as new cars which retain their utility, they necessarily lose value in the consumer’s eye. The consumer’s choice to ignore our product is reinforced by other consumers choosing to ignore our product. “If no one wants it, why should I?” Day-old bagels, overripe bananas, and the Chevy Nova (that’s no go, in Spanish) are basically dead-on-arrival, until… we hit ‘em with a discount!
If we’re lucky, all needed was a price-tweak. If we can sustain demand and profitability for our product at a reduced price, then our discount led us to a new, superior price-point. In all other cases, we just liquidated. Ouchems.
And there’s one more happy discount that places us in the good graces of the almighty herself.
An organization that profits well off its standard customers is fully within its moral right to offer discounts to customer categories. Discounts for veterans, police, hospital staff, emergency responders, senior citizens, and non-profit groups attract more business from those categories and reinforce our brand in the minds of consumers who too respect these individuals.
People want to do business with organizations they like, and organizations that offer discounts to respected groups are they themselves liked and respected. Now it almost goes without saying, but we must do this genuinely. We mustn’t begrudge an octogenarian the $5 they’re saving on our SaaS products.
Choose a segment that you respect and treat them well. They will recommend you to their friends. And don’t shy away from advertising this perk: we want people taking advantage of it and we want everyone else to know where our values lie.