Remember Loss Leaders

January 24th, 2009 | Posted in Advertising, affiliate marketing, Making money, Marketing, sales copy, Sales Pages | Comments Off

Especially when dealing with a new business or a new product, one of the tactics that brick and mortar businesses have been using for years is the “Loss Leader”.

It’s a product that you offer at an extremely steep discount, even steep enough that you’re actually losing money on it. The idea is to use the extreme discount to get the customer into your shop where they can be subject to impulse buying.

A good example of modern Loss Leader is the computer game consoles like the Wii. Yes, they start out really expensive but as production catches up with demand the price starts to drop.

Eventually the price gets low enough that the game systems themselves are fairly cheap. However the price of the games that go with the system stays at the $35 or $40 each that they started out at. The sale of the game system is the hook and most customers will end up coming back to buy additional games and accessories for it.

Technorati Tags: hook, game console example, impulse, shopping, game systems, steep discount, loss leader, wii

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