Everyone loves a discount—but many e-commerce owners and managers don’t realize that adding a donate-at-checkout option can be more powerful and more profitable. Before you lower your prices or launch a promotion, consider what discounts do to your brand vs. what donations can do for your brand.
Discounts Weaken Perception
How do you want customers to perceive your brand and products? Discounts inherently create questions and concerns around quality. Are the materials cheap? Will the product last? Is it out of style? Does it work as advertised? Is the original price exaggerated? Customers are always skeptical when shopping online. A discount may do more harm than good.
Donations Strengthen Connection
Discounts are extremely transactional. You want to make the sale. The customer wants a deal. Discount and done. Donations, on the other hand, bring customers closer to your brand. A donate-at-checkout feature is the perfect way to do good and look good. At ChangeUp, we’re even taking e-commerce donations to the next level of personalization with our new donate-at-cart technology.
Discounts Are Addicting
Discounts are a vicious cycle both for you and your customers. Be careful of falling into the discount spiral where you’re constantly relying on discounts to generate spikes in sales, with long periods of stagnant sales in between promotions. Meanwhile, your customers no longer even consider paying full price. If you don’t plan to be a discount brand, it might be best to refrain from the low-hanging fruit.
Donations Are Uplifting
Discounts bring instant gratification, but material and money highs don’t last. When a customer chooses to make a donation at checkout, they get more than a quick hit of dopamine. They feel good about themselves, good about their purchase, and good about your brand. The warm, fuzzy feeling sticks and then rekindles every time they return to make a new purchase (and with it, a new donation).
Discounts Diminish Value
“I’d love to make more sales and see less revenue,” said no e-commerce owner ever. By nature, a discount leaves money on the table. Unless you’re able to get customers to stock up during a discount event, you can expect a lower average order value (AOV) and lower return on investment (ROI) from any paid advertising. And remember, discounts diminish perception of value as well, so new customers coming to your site could potentially be less likely to convert.
Donations Drive Sales
Yes, you read that correctly, first in the title of this article and now as the parting takeaway. Every $1 pledged in donations generates roughly $4.88 in new sales. That’s because customers love buying from (and donating with) brands that give back. Get the best e-commerce donation technology for your website with ChangeUp, so you can say goodbye to discounts, hello to donations, and yes to better sales performance.