When many traditional brick and mortar businesses start their move to an internet marketing model, one of their first temptations is to offer discounts to entice new customers.
I consider this a cop out of the worst order that will have a negative impact on their overall goal of building a better business model. So here’s a question that every business leader should consider:
What if you could not use a discount model as part of your new internet marketing solution?
I always include this question when I first talk to business owners to ensure they avoid the easiest “cop out” in business innovation. While there is nothing wrong with a discount model (look at the stock brokerage industry), I believe it is easy to convince yourself that customers will flock to your business due to the savings that your discount model will provide.
You have to begin by asking yourself if “cheaper” isn’t the benefit, why would the customer choose to work with your company? Even if cheaper is part of the solution, I believe you had better be able to communicate your value proposition without “price” being considered as a major reason. Why?
Because trust is missing. There is so much garbage available to consumers that you have to earn their trust before a transaction will occur. Consumers now have the wonderful resource of the internet to aid them in their search for a product or service, so they are going to arrive at their solution with a different mindset or position than they have in the past.
Show your customers that you are the best solution to their problem, not (just) the cheapest. I have always felt that if you attract new customers with price alone, you will always have to be the price leader to get their repeat business. Lure them to your company with information and service, and you can look forward to long and profitable business relationships.
And so isn’t it logical to conclude that “if I can create trust, then I won’t need to discount?” Certainly something to mull-over; forever.
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