Hi there! 👋

Brands discount too much. Often, customers would have bought anyway (see 1/8, Subsidy Costs).

Here's how to fix it:

1. Only discount at the point of biggest impact. When you need to change customer behavior.

2. Only discount the minimum amount necessary to change behavior.

Combine these for a powerful tool: the Discount Ladder.

Example: You want a 1x buyer to buy again.

Try this:

→ Offer 10% off 30 days after purchase.
→ If no purchase in 30 days, offer 20%.
→ Still no purchase? Offer 30%.

Ascension of perceived value is key.

Use Discount Ladders in:
→ Welcome sequences
→ Retention campaigns
→ On-site popups

Experiment with different ladders. You'll find the exact minimum margin needed to incentivize behavior.

The rest of the margin? Straight to your bottom line.

Stay tuned, have a great Sunday!

Erik

Whenever you’re ready, there are three ways I can help you.

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