Tips from the Karrys Team

Our own experts at Karrys bring you their pointers and guidance for success.  Check back for tips and techniques you can apply in your business.

Increasing Sales with Additional Purchases: What Works, What Doesn’t

Excerpts taken from www.conveniencestorenews.com

There are many promotional techniques to increase sales through additional purchases.  They are very popular across all industries and retailers – and the reason is that they are so powerful and can be a very compelling call to action...when they’re done right.

We see a variety of promotional strategies every day.  Some of the more common ones are:

  • Buy X Get X Free
  • Holiday Sale
  • Buy 1 item, get the 2nd half off.
  • Buy 2 for only $X.XX
  • End of the year sale
  • Get 10% off on your next purchase
  • Coupons

Unfortunately, these promotions are often used with the wrong products, at the wrong time, or with poor planning.  In those cases, they aren’t always successful and don’t bring about the results you were hoping for.

Goals
Your goal in a promotion should always be clearly defined.   Saying “to increase sales” is not a specific goal, although of course all activities should be to this end.  Some possible goals for your promotion include:

  • To build awareness for a particular item, often a new item
    • The item should have a broad appeal for current and potential customers, a good retail and a healthy margin.  Example: Buy a Limited Edition Kit Kat and Get a 2nd for only $1.00.

  • To get more customers to try a specific category in your store (e.g. coffee) 
    • This category also needs to have a broad appeal for either current and/or potential customers, have a good retail and have a better than average profit margin.  Example:  Freshly brewed coffee only $0.99 for a limited time.

  • To temporarily or permanently change a customer’s buying habits (getting them to your store instead of the competition) Try offering a highly desirable product at cost, or maybe even below cost to ensure that you have the lowest price in the area. This could be a short term fix since you can’t have the best price forever, unless you can offer those customers something else in your store that they couldn’t get elsewhere.
    • It is common to see promotions like 2L. milk at very low prices, for example.
    • This should be a product that brings in customers you didn’t previously have (vs. giving a discount to your existing customers) and it should be a product that generates a lot of additional sales.  For example, if you offer pop at a low price, you may also sell more chips, nuts and chocolate.

  • To get existing customers to purchase more of an established product. This works best with products that consumers will consume more of when they have more on hand – example chips.
    • Example: Get 2 bags of chips for just $1 more than 1 bag!

  • To get existing customers back into your store a 2nd time later that day (for stores with strong morning/lunch traffic, but no evening traffic)
    • Example: $0.99 hot dogs after 3PM or deli meats at lower prices after 5PM

So your basic promotion goal categories are:

  • Get new customers into the store
  • Get existing customers to buy more of an existing product
  • Get new or existing customers into the store during a slow part of the day
  • Get existing customers to buy a new (more profitable) product/category

Once you have a clear goal, be sure that the product you promote offers clear value to the customer.  And you also need to decide on the time frame for the promotion – if it’s too long the deal no longer seems special – so be flexible as it depends greatly on the results of the promotion. 

Whenever you run a promotion, you should set it up in such a manner that you are easily able to track the results either on a daily or weekly basis. That way you can determine what’s been successful and ultimately what will enhance the profitability of your store.

And finally, don’t forget to advertise if your goal is to bring in new customers to your store!

Good luck with your promotions!

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