Are you running promotional offers for your products? Are they giving you a spike in sales revenue? But did you know these offers could also be hurting your revenue margins for some customers?
When you send the same offer to all of your customers with an X percentage off on your price, you lose margins on loyal customers who expected different offers from you.
You need to send offers based on what the customer preference is to engage and convert more. These offers are part of what are called intent-based promotions.
Take for instance James, Sarah and Kyle who all go to the same coffee shop in their neighborhood. Let’s consider each customer’s purchasing pattern at a time and see how intent-based offers could help increase conversions. In this case, the data point is how often they returned to the coffee shop.
James has visited the coffee shop everyday of the week and usually orders a cup of Black Coffee with Cake Pops.
Sarah has visited an average of four times a week and orders her favorite a cup of Cappuccino every time.
Kyle has visited only twice in the last quarter with his family of three.
Thinking on behalf of the coffee shop, will you give all three customers the same promotional offer?
If you gave 10% off on all products to all three customers, you will be losing money with James and Sarah, as they have shown a propensity to buy from you at full price. In other words, you will be losing your margins over discount ranges for which your customers were not expecting a discount.
On the other hand, if you provide an offer to upgrade James’ Black Coffee to a larger size for $1.50 more, he would be tempted to buy it. Offering 7% off on a serving of Southwest Veggie Wrap for Sarah based on her taste profile will work the same way. And a flat 10% off on products for Kyle with an expiry date of two weeks will make him come in without a long break between visits. These offers are customer-centric and valuable to both you and the consumer.
In simple terms, intent-based offers predict each of your customer’s maximum buy-in value on the products they want. When done at scale, these offers will increase your revenue by at least three times.
Harvest Unharvested Revenue with Intent-based Promotions
In summary, offering promotions is essential to drive more customer engagement at your store.
When you provide the same offer to everyone, you gain some engagement and a boost in sales, but you lose your margins on customers who did not need a big offer to convert.
Therefore, if you provide offers based on your customer’s purchase intent, then you harvest revenue that was otherwise unharvested in the previous two use cases. These offers are called intent-based offers. Intent-based offers follow a customer-centric approach to creating offers and your customers are happy to come back for more such offers.How Do Qubriux’s Intent-based Offers Work?
When recommending a product to a customer, Qubriux learns the customer's preferences based on past purchase data and delivers a real-time recommendation that the customer is most likely to purchase.
It helps create different customer segments based on the data points available on each customer. It then creates intent-based promotions with higher conversion probability for each segment.
Whether it is a flat discount or free shipping or even a BOGO (Buy One Get One) offer, Qubriux creates the offers your customers want. It then enables you to reach your customers on channels you prefer- through emails, text messages and push notifications on your app.
If you have questions on how you can increase the value of the offers you make to your customers, mail to: email@example.com or visit www.qubriux.com.