or, the power of expiring offers in making more sales
Here is a simple secret to make more sales. Just include an expiring offer on your product. Something like 10% off ends on 30th of October. And see what happens.
I have been testing expiring offers ever since I launched my first product in 2009. And every single time when we add an expiry clause, we see a spike in sales.
Read that again – Every Single Time.
What is an expiring offer & Why it works?
An expiring offer is just what it means. A sales offer that has an expiry clause attached to it. Examples:
- A product that will not be sold after certain date
- A price that will go up after certain date
- A discount code that expires on a certain date
- A bonus element that is valid until some date
Why expiring offers work?
We are prone to avoid losses than make gains. Risk aversion remains one of the key motivators for a majority of humans ie customers. So when presented with an expiring offer, many people think like this:
Hmm, I am going to loose this offer if I do not go for it.
The same customer when presented with a normal offer (buy this instead of buy this before x) thinks:
Ok, by purchasing this I am going to get a,b,c… But I will part with $$$. Let me think and decide.
I am not saying the rational side of a customer shuts down when presented with expiring offer. Instead, when faced with an impending deadline (offer expiry), the customer will make faster decisions.
Examples of Expiring offers
Expiring offers are one of the most prominent & time-tested marketing ploys. They are everywhere. You just have to walk in to a near by mall or online store to see them.
These are popular examples:
- Amazon.com’s shipping suggestion: When you visit a product page, Amazon indicates the a shipping date like this: “Order now to have it shipped by October 29”. Many online shopping sites do this too.
- SALE posters you see in malls, stores: Almost any store has a sale going on these days. Sometimes, you see “Going out of business”, “SALE” posters round the year. And yet they work.
My Own experience with Expiring Offers – case study
As mentioned earlier, I try expiring offers every now and then. Let me tell you a recent experience.
In September (2012), Daniel Ferry (one of the fellow businessmen in my industry) announced launch of his training program. Daniel is also my good friend and partner. And his program is going to expire on October 15 (that means anyone interested must enroll before that).
I called up Daniel to ask how I can support him in his launch. During the discussion, I got a crazy idea: Why not partner with him and offer one of my courses along with his course as a bundle.
We discussed it and worked out the specifics. And in no time Excel School + Excel Hero Academy Bundle was born.
I offered 3 options for our customers:
- My course alone
- Daniel’s Course alone
- Both courses combined (Bundle)
I promoted it to our customers and readers. Since it is an expiring offer, I expected that on the last 2 days we will have a spike in sign-ups. And we got lots of people going for the bundle option as expected.
But here is the kicker.
On last 2 days, I got lots and lots of customers for my course too. That is right. Even though my course has no expiry, people still bought it.
How do you explain that?
Very simple. Just like you walk in to a store that advertises SALE on few items and buy something else that is not on sale, my customers went in to buying mode due to expiring offer and then evaluated the options (3 courses) and signed up for one.
But is this right thing to do?
As an entrepreneur we all face these challenges often:
- How do we push customers make the purchase decision without being pushy?
- How do we remain ethical, honest and valuable to our customers?
The answers need not be contradictory. You can come up with something that is ethical, valuable & win-win for you & your customers.
Here are the guidelines we follow:
- Expire offers very few times an year. I usually do this 3-4 times every year. Often combining with product launches.
- Never lie or provide incorrect information about our offers.
- Give time to our customers so that they can make informed choices. For example, we advertised the bundle offer (above) 3 weeks prior to close date and reminded our prospects few times in-between.
- Allow customers to call / email / chat with us to know more and decide which works best for them. For our bundle offer, I had many customers call me and ask if it is right for them. And in several cases, I have advised them not to go for it because it might be overkill for what they need.
- At all times, observe our values and keep customer priorities in sight.
Remember – Expiry looses value too
It is like the proverbial golden goose. Just because we can temporarily spike sales with an expiring offer, if you over do it, your offer looses its power.
Do you use expiring offers?
Have you tried an expiring offer? If not, go ahead and experiment with it. Tell me how it went.
Please share your experiences with us in comments.
PS: Comments on this post will be closed tonight. So hurry up 🙂