By k | December 26, 2012 - 6:00 am - Posted in Sales

You have the option of
running
a Buy One, Get One Free (BOGO) promotion
or a 50% discount.

Both are
the same value to the consumer
and cost to the business
but which strategy will drive the most sales?

It depends upon the product.

A study in the Journal of Marketing,
When More Is Less:
The Impact of Base Value Neglect
on Consumer Preferences
for Bonus Packs over Price Discounts
,
finds
“that the preference
for bonus packs
over price discounts
holds for inexpensive products
and familiar brands
but diminishes
or can even be reversed
for expensive products
or unfamiliar brands.”

In other words,
while the Buy One, Get One Free offer
works better with cans of Coca-Cola,
the 50% discount
works better with cans of cola produced
by a startup beverage company.

If your product is new
and unproven,
the steep discount should produce more sales.

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