My sister does not believe in high-discount; I was astonished when she told me so. She painted an example for me, and she said
“If, for example, a laptop has a price tag for $400 that is KSh. 40,000 and I bargain until the seller allows me to take it at the cost of $200 I can’t buy it.
I asked her; why can’t you take it and it is so obvious you will save a lot of cash?
“It is not a matter of saving, but the quality of the particular product that you are buying. No seller can accept to sell at a loss. So, with that, it means if the seller gives a very high discount it is more likely that the product is a counterfeit.”
Well, I have never thought that discounts could actually chase away customers. She made me to remember another day I was in the supermarket, and I wanted toothpaste. I am a loyal fan to Colgate, but that day I saw another competitor brand on the shelves the size was the same, but the price was too low until I was scared.
I was scared of the fact that, the toothpaste was a minor brand; I have never heard about it, it was too cheap because maybe the brand was giving a discount to enter the market or they did not set a realistic competitive discount price.
Offering discounts is great, especially when you are rewarding loyal customers, but when you are introducing a new brand into the market, and you have not created enough awareness that is you have not done enough marketing it can do more harm to your business.
People love discounts, but when it is too high than expected, then it creates suspicion on the product. The trust of the product to people goes down, and some of the thoughts that start taking space in the mind are maybe the product is due to the expiration date or the product is outdated.
Whenever you are setting discounts, you should be very thoughtful about what range and the season you are going to give the discounts.