Offering Discounts to Customers: How Creators Can Optimize Sales

Last updated: October 5, 2022

Selling your digital products and services online requires just as much planning as creating them. You need compelling marketing, an engaged audience, and a dependable selling platform. But what happens when all that still doesn’t translate into better sales figures? 

A good place to start is offering discounts to customers. 

Everyone loves a sale, with a recent survey showing that 88% of American consumers used discount coupons in 2020. 

So what does it take to successfully promote deals on downloads, subscriptions, and memberships online? Here’s what digital creators need to think about before slashing prices.

3 Things to Consider Before Offering Discounts

Selling online is a great way to monetize doing whatever it is you love to do. However, you mustn’t forget why you’re doing it: To make money. You should consider the following factors when deciding if, how, and when to offer discounts to customers.

What’s your profit margin?

The fact that you can sell your own products online with little upfront cost is a major advantage of being a digital creator. However, you still need a sustainable business plan.

Before offering discounts to your customers, you must calculate: 

• Your business expenses (subscription fees for graphic design software, social media management tools, web hosting & maintenance, selling platforms etc.)
• The amount of profit you need/aim to make

Adding these two amounts gives you the magic number you need to hit each month. This will guide you on how to price your products and apply discounts accordingly.

Haven’t got a clue on how much to sell your Ebook for? Check out our guide to Ebook pricing.

Who is your customer?

Everyone loves a sale, regardless of age, gender, or economic status. Yet keeping these factors in mind will help you better understand which discounts to offer and how to offer them. 

Creating customer personas is a great way to do this. Here are some categories to get you thinking about who may be interested in your products and how to offer them discounts.

• Age
• Gender
• Location
• Profession
• Income
• Family (marital status, children) 

So how does this information help guide decision making when it comes to promotions?

Firstly, if you’ve already determined the minimum monthly amount you need to make, estimating your customer’s budget can help you zero in on that discount ‘sweet spot’ — an amount that entices your customers yet still manages to make you a profit.

Secondly, solid customer personas can help you decide which products to include in sales bundles or buy one, get one deals.

How does your store & schedule look?

Getting your products in front of customer eyes is a digital feat in itself. Once you’ve done it, that first impression counts: Your storefront should provide background information on yourself, detailed item descriptions, and a simple checkout process. This demonstrates legitimacy, fosters buyer confidence, and makes a lasting impression.

If you’ve got a variety of products, you’ll need to decide which ones to discount in order to convince customers to buy more. This is where having an accurate customer persona really makes a difference: It helps determine which items serve best as a discount or freebie, and which ones are attractive enough to keep at full price. 

As a coach or instructor offering free consultations or trials, you can’t risk overbooking yourself  to gain more customers. You will need to review your current client volume and availability before launching such promotions.

Think you’ve got what it takes to win in the world of coaching? Here’s everything you need to know before getting started.

Types of Discount to Offer for Digital Downloads

Smart sellers know that there’s more than a sale to be won when offering discounts to customers. Getting the most out of special deals means giving the right one at the right time. 

These are some of the discounts that you can offer to digital download products such as ebooks, audio files, design assets, and more.

1. Percentage reduction

This is the most common type of sale and the one online shoppers love most: Recent data shows that 74% of digital coupon users prefer a percentage discount to other types of promotions.

What to look out for

For cheaper products, customers tend to perceive a better deal in percentage reductions versus dollar amount discounts — even when the savings are identical. For example, a sale featuring $20 T-shirts at 25% off will get more attention than one offering $5 off those same $20 T-shirts. 

How to use it

• Attract new customers and grow your mailing list by offering 10% off their first purchase when they sign up for your newsletter. 
• Reward loyal customers with a 20% discount on their next purchase.

2. Fixed Amount Discount

Another common type of discount is one which offers a fixed amount off a product’s original price. As with percentage reductions, messaging is everything.

What to look out for

Get the most out of fixed amount discounts by applying them to more expensive products. See how different $50 dollars off a $150 digital print poster seems compared to offering the same product for 33% off. Consider applying it to pricier items which haven’t performed well over time. 

How to use it

• Offer a fixed amount discount on purchases of a minimum total. For example, $30 off all transactions over $100.
• Allow customers to buy and send digital gift vouchers for $10, $20, $50 etc.

3. Buy One, Get One

BOGO offers are essentially offering two products at 50% off. It’s no wonder why this is the type of discount preferred by 64% of shoppers across the board. This type of promotion is a great way to cross-sell items and introduce your customers to products they may not typically purchase. 

What to look out for

Be smart about which products you bundle and consider your customer. Is the potential for combining products of different categories greater than the risk of an abandoned cart? Or should you play it safe by offering related products, even if it means giving away an item which may have been purchased separately regardless?

How to use it

• Send BOGO deals to your mailing list and offer customers any free item when they buy a new product at full price.
• Advertise Buy One, Get One deals on social media. Create a multi-slide reel of all products that customers can mix and match for the discount. 

4. Bundle discounts

Offering multiple products at a discount is a great way to upsell and increase your AOV (average order value). Research shows that 29% of shoppers will buy a product they hadn’t originally planned on purchasing if it’s heavily discounted. Brick-and-mortar stores use this type of discount to quickly move out stagnant inventory in order to make room for new items. 

What to look out for

As a digital creator with unlimited storage space, keep your margins in mind before giving away multiple items at a reduced price. Also, remember that with bundle discounts, timing is everything: One popular tactic is offering this promotion towards the end of the customer journey. Once someone has decided to buy something, offer related items in a bundle for a discounted price at checkout. 

How to use it

• Add a pop-up window to your checkout page featuring a bundle with related products.
• Feature a bundle discount on product pages with complimentary items listed below or on a sidebar.

5. Limited time/supplies & seasonal offers

The internet is open 24/7 and that diminishes the sense of urgency to buy when shopping online. Applying time-sensitive discounts or limited-supply offers encourages customers to take action quickly. Additionally, you can use holiday or seasonal offers to take advantage of increased shopping traffic or to promote items relevant to particular times of year. 

What to look out for

Plan your discount calendar ahead of time. This will help you time new product launches and your social media content. Also, be careful about sale duration times: You want to make them small enough to create urgency, but large enough for adequate promotion and customer awareness. 

How to use it

• Send birthday discounts to customers who have previously purchased with you.
• Offer digital holiday coupons to your mailing list.
• Participate in Cyber Monday with significant discounts.
• Include sales on seasonal products within your newsletters. For example, if you create vegan cookbooks, offer discounts on your best soup cookbooks at the start of autumn. 

6. Freebies

Though technically not a discount, freebies can be a great way for sellers to grow awareness and drive traffic to their online store. This type of promotion is perfectly suited for digital creators because you incur no monetary loss. 

What to look out for

Everyone loves free…but the point of freebies is to get your customers to buy eventually. So be wise: Offer templates that demonstrate your best work and leave your audience wanting more. For example, if you’re a fitness instructor, you can offer your customers a free weekly meal plan featuring only lunch options, or workout routines targeted towards one specific area.

How to use them

• Offer free downloadable PDF templates throughout your social media platforms.
• Combine less popular items as freebies when customers purchase products at full price.
• Promote free items in your mailing newsletters and link to your store page to drive traffic.

Types of Discount to Offer for Subscriptions, Memberships, and Software

Think offering discounts to customers only involves downloadable products? As a coach, instructor, or software developer, you’ve got plenty of options to promote memberships to your courses, and subscriptions to your software. 

1. Free trial/Freemium plan

Offering a free trial subscription to your course materials or software can be the perfect way to attract and retain new followers. 

What to look out for

As with product-based promotions, knowing your market is crucial: What are your potential clients looking for? How can you show them just enough of your services or software to convince them to commit to paid options?

How to use it

• Offer a free version of your software with limited features.
• Offer a full version of your software for a limited time. 
• Promote a free trial of workout plans or courses.
• Create savings for opting to pay annually vs. monthly.

2. Free consultation

Free consultations can be a great way for coaches and other service providers to win client trust. You can offer a short, live meeting over Zoom or through a messaging platform. Clients describe their particular issue (weight loss, nutrition, parenting issues) and you can offer a structured plan tailored to their needs. 

What to look out for

First and foremost, you’ll need to determine how much time you have available. Are you targeting a local or international audience? Time differences may be a scheduling factor. To address both issues, advertise limited availability (i.e. first 10 respondents) and be clear as to what you’re offering and who it’s suited for. 

How to use it

• Feature a ‘booking’ button on your store page linked to Calendly or another interactive scheduling tool.
• Send free consult promotions to members of your mailing list who haven’t previously purchased or booked with you.

3. Free webinar/Q&A

Creating live events is a great way to get the word out about your services. While you won’t be able to devote as much time to each individual participant, this option may be less intimidating than a 1-on-1 consult. 

What to look out for

Pick a general topic that your audience is interested in and be prepared to answer questions! Aim to provide useful information without trying to sell your services, yet don’t go too far into specifics — keep them wanting more!

How to use it

• Create a live event on Facebook and promote it via your social media account, website, and email.

Score more signups for your coaching business with Payhip’s full range of coaching products. 

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Which marketing channels to use when offering discounts to customers

Even the most well-planned discounts will fall flat if they aren’t promoted successfully. Using proper marketing channels correctly increases the likelihood that your promotions will reach your target audience and convince them to take action.

Social media

If you haven’t created a social media page for your products, now is the time to do so. This is the primary tool for getting your products or services discovered. 

• Creating a Facebook business page helps you appear more professional and allows millions of users around the world to find you. Use your page to promote discounts, and connect with your audience. Join relevant groups to learn more about your niche and grow awareness of your products. You can also use the platform to create and promote free live events as well as paid advertisements. 
• Instagram is the ultimate tool to capture your audience’s attention, display your products or services, and drive traffic to your storefront. In a recent survey, 33% of respondents said they had used discount codes found on stores’ Instagram pages to shop online. Create posts displaying sale items and include discount codes in the caption. Link your store’s page to your bio as an easy way to take customers to your site in seconds.

Post less, sell more: See how to automate social media to sell your Ebook here.

Email marketing

Marketing emails are notoriously loathed by customers. But don’t ditch your newsletter just yet: A surprising 81% of online shoppers actually like receiving emails including sales announcements or discounts. Grow your email list by offering signup discounts and freebies, then use it to send your customers discounts and drive more traffic to your store. 

Your website or storefront

As a digital creator, having a dedicated space for your products and services is crucial. Use social media and email marketing to increase traffic to your store front, where customers can get a more in-depth look at you and your inventory. Use pop-ups and related product windows to promote bundles, BOGO discounts and more. 

No website? No problem! Link your Payhip store to your social media account and instantly connect your products with millions of online shoppers. Find out how easy it is here.

On average, online shoppers who use discount codes spend 24% more than those who don’t. As a digital creator, it’s in your best interest to find an easy and effective way to offer discounts to your customers.

Payhip helps thousands of online creators sell their products with no upfront investment or website necessary. Find out more about how easy it is to get started today.