Some days ago a Slovenian hotel sent me the following sales promotion e-mail:
So what about our sales promotion? It’s priceless – because only you can tell the price! Tell us what you normally pay for renting a conference room, and we’ll give you 15% off on a similar room in our hotel. The only condition is that you rent the room during the week and between…
In other words, they’re offering me a 15% discount on any price that I can get anywhere else!
A few days later another hotel offered me their conference rooms free of charge in April: completely free, only if I was also willing to try out their services.
What’s the problem with such offers?
If a seller begins with prices – we’ll talk prices.
Entrepreneurs who’re always whining that they are squeezed by prices usually have only themselves to blame. After all, they are the ones who bring up the topic.
But if we decide to offer discounts, the promotion has to be limited in terms of duration and to a particular occasion; for example, a promotion connected to a branch opening (upgrading). This way we’ll have fewer problems raising the prices later.
In short, when we lower prices, we have to say why, and keep the promotion unique, occasional. The best thing is, of course, not to compete on price. There’s only ever room for one cheapest company.