Home > Uncategorized > The Discount Needed to Drive Purchasing

The Discount Needed to Drive Purchasing

While comparing notes with another retailer this weekend, we both agreed that running a sale or printing a coupon with “20% off” or even “25% off” no longer drives customers into the store. It’s possibly due to online competition, but no doubt also due to stores like Winners offering discounts based on suggested list prices that customers don’t trust.

Today, I started wondering if that’s true at the wholesale level as well. Traditionally, booksellers enjoyed the standard “trade discount” of 40% and then publishers and distributors would offer advertise “extra 2%” or “extra 4%” or pre-publication discounts of 46%. (Why was it always 46%? It was based on “40 and 10,” they would deduct 40% and then take 10% off what was left. Sometimes dealers would be offered “40, 10 and 10” on a special item and it would sound like 60%, but was really just under 52%.)  But lately, it’s hard for dealers to be impressed by anything less than 50% off, a factor not lost on David C. Cook Canada’s “Big Deal” promotion running through 2014.

Dealers want greater incentives to commit and also need greater margins to give customers the discount they are seeking.

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