Are discounts helping you sell more, or teaching customers to wait for a better price?
Discover the financial cost of discounting and explore how pricing may be influencing customer behaviour.
The Financial Cost of Discounting
Here's what your current discounting approach means in financial terms.
Discounted selling price—
Monthly revenue given up through discounts—
Gross profit after discounts—
Compare the Two Scenarios
Financial measure
At regular price
After discount
Monthly revenue
—
—
Gross profit
—
—
Gross margin
—
—
The Volume Question
Now Let's Look at Customer Behaviour
The financial figures show what discounting costs. These questions help explore why it may have become necessary.
Your Three Behavioural Lenses
Your answers provide starting points for understanding how customers may be responding to your pricing. Explore these three areas.
1. Anchoring — What makes the discount look attractive?
2. Loss Aversion — What makes customers act now?
3. Perceived Value — Why should customers pay full price?
These calculations assume the same number of purchases in both scenarios and unchanged variable costs. They do not establish how customers would actually respond to removing discounts. Behavioural interpretations are hypotheses for further investigation, not definitive diagnoses.
Are Customers Buying Your Value — or Your Discount?
Understanding why people choose, hesitate and buy can help you make better marketing decisions. Explore the human behaviour behind your customers' decisions.