Before we get into today’s post, let me start with two questions:
Has the band Queen won more or fewer than 27 Grammy Awards?
How many Grammy Awards has Queen won?
Take your best guess and keep the answer in the back of your mind for now. We’ll revisit it in a minute.
Back to your regularly scheduled blog post…
I’ve heard a lot of gurus suggest NEVER giving discounts. A blanket ban on them.
I understand why they say this but I don’t agree.
A well-executed discount can cause an incredible sales boost. A discount creates a sense of urgency in purchasing — it encourages someone to go from “I’ll think about buying this someday” to “I better buy this now or I’ll miss out big time!”
As humans, we’re wired to seek pleasure and avoid pain. A strong discount activates both of those drivers.
Getting a great deal makes us feel pleasure. Missing out on a great deal makes us feel pain.
Many gurus are anti-discount because it’s so easy to use discounts the wrong way. Discounts can be disastrous, resulting in your products and services appearing cheap without any increase in sales to counteract the damage.
But don’t let that scare you!
Discounts can be used extremely effectively. But you have to understand one key principle in human behavior first.
Did you fall for the trap?
Back to the question I asked earlier:
How many Grammy Awards has Queen won?
I’m guessing your answer is somewhere around 27.
It might be a bit less or it might be a bit more. But I’ll bet it’s a lot closer to 27 than the actual answer…which is ZERO.
Am I right on that one?
This is the anchoring heuristic in action.
Humans are relative thinkers, not absolute thinkers. We look to others and clues around us to form our opinions.
So when I asked you for your best guess, you looked for clues.
You subconsciously used 27 as a reference point. Your brain was whirring away in the background in the second or two it took you to formulate your guess.
Simply mentioning the number 27 was enough for it to influence your final answer.
Powerful stuff, this anchoring heuristic, isn’t it?
Whether you’re guessing at Queen’s Grammys or the price of a product, the anchoring heuristic can be used as a strong persuasion tool. And when you understand it, you can use it to successfully offer a discount.
How to use the anchoring heuristic to persuade your audience
The anchoring heuristic is most famously used in negotiations when someone “high-balls” or “low-balls” an outrageous amount.
The first number anchors the whole negotiation, which is why so many people start negotiating much higher or lower than they truly want.
Whether you love or hate it, this negotiation strategy works. The anchoring heuristic teaches us that where your story starts directly influences how it ends.
You can apply a version of this “high-balling” strategy in your sales copy to anchor readers’ perception of value. You’ll guide them to anchor on a high value — using clever clues in your copy — to make the discounted price of your product seem tiny by comparison.
The 3 things to present BEFORE you share your discounted price
Start with value
Your goal in sales is to make the value of what people are getting feel like more than the monetary amount they’re paying.
So before you utter a single syllable about your price, present the full value of what people will receive.
Paint the picture of all the good things that will happen if they purchase your product. Juice up the benefits and lean into the emotions of what you’re selling to make your product seem over-the-top-valuable.
That’s the mindset you want your audience to have before you talk numbers, so their perception will be anchored by the immense value — both tangible and intangible — of what they’re receiving.
Pepper in testimonials
Testimonials are helpful forms of social proof but they’re also incredibly strong anchors.
Before you present your discounted price, share a few of your strongest testimonials.
When a reader sees that “I made $7K in my first month of using this product” or “I lost 95 pounds following this eating plan,” that’s going to anchor their opinion of what can happen to them.
They may not expect to make $7K or lose 95 pounds, but they’ll expect to hover somewhere around those numbers. This strengthens the high value they’re already anchoring on.
Share the full price BEFORE the discount
When you’re offering a discount, always always ALWAYS present the full price of the product first!
Readers need to anchor to the full price of the product before they can appreciate the discount.
Only after you’ve shared the full price for the product can present your discount.
If you’ve applied the anchoring heuristic correctly, you’ll trigger a response like:
“I’ll get all these benefits, I’ll get results similar to other people, the full price is $2000 and I can get it today for only $497? Sign me up!”
A word of caution about discounts
There’s one critical rule to follow in order to effectively use discounts:
Offer discounts (very) rarely.
We’ve all come across people who never actually sell their products at full price. The “discount” price is really code for “the only price I ever sell at.”
Kohl’s is known to do this. Very few items in their stores are ever sold at full price. There is always some kind of promotion (Super Saturday! Friends and Family Rewards! Third Thursday after our founder’s birthday!) that applies a discount.
This conditions people to expect discounts. To view the true value of a product as its discounted price, NOT the full price. Kohl’s shoppers don’t see the discounts as special anymore, they see them as expected.
That’s the opposite of what we’re trying to achieve.
You want your discount to feel special. Exclusive. A once-in-a-blue-moon opportunity they can’t afford to miss. That’s when discounts encourage action.
Aim to offer your discount 2-3 times per year, per customer. Anything more than that and it stops being so special.
It may be at a certain point in your nurture sequence. Or it could be date-based, like a Black Friday deal. But make sure to limit the number of times you offer your discount to avoid cheapening the perceived value of your product.
When you understand the anchoring heuristic, you can apply subtle strategies to your sales copy to make your discounts seem irresistible.
join the convo
What other ways do you make your product/service seem valuable?
Now that you understand the anchoring heuristic, have you noticed others using it in their sales copy?
And because I’m curious…how many Grammys did you guess Queen had won?