Retail sales is a competitive industry that will keep you on your toes as you try new sales promotions to drive traffic, build loyalty and inevitably increase sales. Whether you want to gain new customers, retain existing ones or encourage customers to make more frequent purchases, you need to know which promotional strategies are the most effective in reaching your goal. Discover the best tried and true retail strategies to drive traffic and build customer loyalty for your business throughout the year.
Discounting products is one of the go-to methods for small business owners interested in increasing demand and sales. The challenge for many small business owners is determining the how and what of product discounts. How much should the product be discounted and for how long? What products should be discounted? Once you answer these questions, turn to the following promotional pricing options to increase sales on all of the right products:
- Markdowns: This is the perfect promotional pricing tactic if you want to offer a storewide sale that will draw in both regular and new customers. Make sure that your large markdown sale is backed by a well-placed advertising campaign that gives customers a heads-up on the upcoming price reductions.
- Loss leaders: Do you have certain products that always seem to be in demand? These products, known as loss leaders, can be sold at a discount, which is a great tactic for drawing new customers into your store. You can also use this promotional pricing idea to increase store traffic, improve brand awareness, and quickly sell overstocked items before your new stock arrives.
- Bundle pricing: The phone companies and Internet providers might overuse the term “bundling,” but bundling products is a great psychological selling tool that will help your bottom line. Whether you like the “buy one, get one 50 percent off” deal or a customized special based on individual shopping habits, bundle pricing is a great way to make customers feel like they are getting “a great bang for their buck.” Once your customers are in the store, you can use the great deal to upsell more expensive items.
Point-Of-Purchase (POP) Displays Deliver Improved Sales
POP displays are a fantastic sales promotion tactic for any type of retail store. From department stores to toy boutiques, a POP display is a great way to encourage a little extra impulse buying, especially during the holidays. In fact, recent customer studies show that 66 percent of all buying decisions are made while a person is physically present in the store.
Keep in mind that POP displays are available in myriad sizes, shapes, colors and types. Before you can choose a POP display, you need to analyze how your typical customers shop:
- Do they head straight for the clearance area?
- Are your shoppers prepared with a list of essentials or do they wander the store?
- Is there a defined pattern that most of your customers follow?
- Does your typical shopper often buy more than one item?
- Does the average customer usually make expensive or inexpensive purchases?
By answering the above questions, you can more easily understand how your standard customer thinks and shops. Once you have entered into the customer’s mindset, you will be able to choose from the following POP displays:
- Strategic stands: The closer customers get to the end of their buying journey, the more you want to encourage them to buy products that they might have accidentally passed-by. You can draw their attention to these products by placing stands or displays with products or services in their line of sight. Additionally, you can place these items along the customer’s path to check out. Make sure that you also include a sign that lets customers know these products are part of a special discount.
- Dump bins: A bin full of products strategically placed along well-traveled “lanes of customer traffic” is a great way to sell discounted products. Oftentimes, these bins can be enhanced by an additional bundle deal. Finally, this type of POP display can be placed right in front of each exit lane to encourage impulse shoppers to buy additional, inexpensive, items that weren’t on their shopping list.
- Free samples: A free sample is a great way to increase sales for new products. Giving away new products, in a sample size, is a great way to build brand awareness, while simultaneously making customers feel appreciated. Once word gets out that your store likes to give away free samples of new products, your doors will be flooded by new customers interested in shopping at a store that gives back to its customers.
With these promotional strategies at the ready, you will be able to attract new customers, build brand ambassadors, and keep your regular customers happy. Remember, it’s all about the right message, right channel and right time. Be sure to keep track of the success rate of each promotional strategy, so that you can fine-tune your in-store marketing efforts to increase sales, build loyalty and drive foot traffic.
Sheila Johnson is an expert writer at shopPOPdisplays, a manufacturer of acrylic display products. Her experience includes merchandising, and retail and display marketing for a variety of industries.