A business is always run for profits, so offering a discount on any item seems to be counterintuitive. Besides, it’s quite possible that the new customers you get won’t be back until you provide another deep discount. On the other hand, a no-cost EMI makes it easier for customers to purchase high-cost consumer goods without hurting their monthly budgets.
It’s all about incentivizing the customer to purchase your products by offering them an attractive deal. In the instant discount scenario, you offer the customer a direct upfront off on a product or service. In contrast, no cost EMI means allows the customer to purchase by paying monthly instalments for the entire product price with no interest charged.
Used strategically, you can promote your business and its products through the means of no-cost EMI and instant discounts. Here is what we know these deals can do for you:
● Introduce new customers to your store/business.
● Pique people’s interest in new products or services.
● Encourage return visits.
● Boost sales during slow periods.
● Generate short-term cash flow during a dry spell.
The competition for new customers is quite fierce, and regularly using deals and offers to attract new customers is the norm. Let’s examine how two seemingly similar offers differ and how you can use them to your advantage.
If you offer a lucrative deal to the public, you will attract customers who are only looking for a bargain. They will use this offer and make their way to the next deal. So, this basic approach is only suitable if your requirements are essential. That is if you are looking for a short-term cash infusion.
However, if you want to build your brand image, you need to develop strategies to develop long-term customer relations. You need to decide your goal and work with a partner to manage instant discount marketing.
There are cases where the product may still seem unaffordable to customers despite an instant discount. Providing such items on a no-cost EMI means that the product is suddenly within the customer’s budget.
A no-cost EMI would require getting the banks involved. Some banks even offer their account holders the feature of availing a cardless EMI. In a no-cost EMI scenario, the interest in the EMIs is part of the product price. However, to sell the product at its original price, the merchant must offer an upfront discount on its cost to sell the product at its actual price.
The discount covers the interest element of the product price. So, whenever the merchant receives the monthly instalment on the product, the interest component of the EMI is paid to the bank. It’s a win-win situation for all—the customer, the merchant, and the bank.
Which One Would Work for You?
Since the result of both complement a particular strategy, you’ve got to decide which one will suit your business needs better. The cardless EMI facility has also emerged as an excellent alternative to the EMI facilities offered by e-tailers.
While instant discounts also offer you opportunities to build your brand and move into targeted marketing in the future. Cardless and no-cost EMI provide customers with great convenience since all they need is their mobile number and PAN card to avail of it. Besides, banks may offer them additional benefits for using this service.
Hence, it boils down to the product you are selling to a large extent. Instant discounts are way simpler for the merchant to carry out and are a good idea in most cases. However, offering a no-cost EMI on higher-priced items would make sense.
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