The Power of Deals

The Power of Deals

Deals seem to be a dime a dozen these days 

Every day… On every platform, there’s always a sale! 

As a brand owner, keeping up with this constant cycle of promotions can be overwhelming, especially when you're juggling inventory management, budgeting, scheduling, and more. The pressure to always have your products on sale can be daunting.

While some eCommerce brands have started to move away from frequent sales, we at Straight Up Growth understand the undeniable power of strategic deals. 

In this blog post, we’ll explore key strategies for creating sustainable and profitable product deals tailored to your business needs. We’ll also dive into the impact of major sales events, like Prime Day, and discuss how to mitigate risks when offering discounts.

Crafting the Right Deal For Your Brand 

You don’t have to follow the conventional ‘deal’ strategies set by big-box retailers. Instead, tailor your approach to fit your business needs and budget. Here are a few tips to guide you:

Analyze Past Performance: Review data from previous sales events to understand what works best. Focus on top-selling products, optimal discount levels, and customer feedback. Use this historical data, along with market trends to forecast demand accurately and prevent overstocking or stockouts.

Utilize Bundle Deals: Offer product bundles instead of deep discounts on individual items. This can increase average order value and reduce the impact on margins.

Plan Ahead With Cross-Channel Campaigns: Spread marketing across various channels (email, social media, paid ads) to reduce reliance on any single platform and reach a broader audience. Start these campaigns a few weeks before the sale to build customer awareness and anticipation.

Create a Customer Retention Incentive: Use post-sale follow-ups, loyalty programs, and targeted offers to convert one-time buyers into repeat customers, maximizing the value of each sale.

Scenario Planning: Develop contingency plans for potential issues, such as supply chain disruptions, website failures, or unexpected demand drops. 

Mitigating Risk While Creating Sales  

While it might seem that brands could lose money by offering deep discounts, this usually isn’t the case if the promotion is planned strategically

Here are a few points to keep in mind while crafting your deals for any sale day: 

Avoid Poorly Planned Pricing: When discounts are too deep or not strategically aligned with overall business goals, this could be a case for concern. It’s important to ensure that the discount still allows for a reasonable profit margin.

Overstocking: If a brand overestimates demand for deal days like Prime Day, they may be left with unsold inventory. It’s important to forecast demand properly and prepare a backup plan for any excess inventory
Tip: Some brands will save higher-inventory items for sale during the T5 holiday season when there are multiple sales opportunities within a few weeks! 

Reasonable Customer Expectations: Offering deep discounts outside sale days might set a precedent, causing customers to wait for sales instead of buying now. This could impact profitability outside of sales events.

Amazon Prime Day: Case Study

Here’s a real-life example of how participating in ‘deals’ can help you win BIG

Initially, this brand was hesitant to participate in Prime Day 2023, doubting whether the traffic would justify the potential revenue loss. 

However, by Prime Day 2024, they decided to test the waters with a sale on just one product. 

The results speak for themselves

(Year-over-Year comparison between Prime Day 2023 + 2024)

By participating in Prime Day, this brand was able to lower its ad spend, cost per click, and total ad spend while increasing total revenue by over 100%. Despite spending 2% less on advertising compared to the previous year, they achieved remarkable growth by simply offering a deal during the event.

Learn more about how your brand can prepare and WIN Fall Prime with Straight Up Growth!