July 22, 2024

Loss Leaders

Good Morning,
Last week I wrote about marketing/promoting your business so you can thrive whether we are in a recession or in the time we are now in.
Communication is key!
Once you have worked your non-current and current customers and are ready to move forward acquiring new customers, you might want to offer a loss leader.
Loss leaders are items that a business uses to attract new customers by offering an item/service for a very low price. Think $.98 gallon of milk, $49 AC tune-up, or a $30 oil change. These offers are designed to bring in the shoppers.
Beware! A loss leader tends to attract people who are looking for the inexpensive. A lot of businesses offer more profitable upgrades or add-ons as a way to make up for the loss leader. Milk is at the back of the store so you have to walk through the store and you might pick up other items not on sale. The oil change people might recommend an air filter replacement or a better quality of oil.
A few businesses do not sell add-ons or upgrades to loss leaders. They use loss leaders or trip wires for a whole different reason, which again if done properly is very much more profitable.
If you would like to know how to use a loss leader to maximum effect and profitability, contact me by emailing me.
Till next time.