Summer's here soon, and for many of us in the language & summer schools sector, this means peak season.
The time when we need bums on all seats to make balance sheets work.
And so when numbers look like they're down from where we wanted them to be, discounts often seem inviting.
"Surely, if we come out with a special offer, that will attract some students. We might have to squeeze our margins, but at least we'll have some profit, and the student experience will be better. Right?"
Yes – and, also, no.
Yes, the right offer at the right time can help plug some holes. And it might result in a seemingly better season for you in the short run.
But no, if you want to offer a discount because that's the only thing you can think of right now, then it isn't a strategic decision – it's wishful thinking.
And that doesn't tend to work in the long run.
The moment you start to shout about a discount, you're devaluing your offer.
And the lower price is the new price.
So now you have less income than you planned for now, as well as a budgeting problem in the future, as you've set a new baseline.
Not to mention that you'll als have some upset customers who had paid you more than what you're asking for now. Or upset agents if you're undercutting their price.
Is it worth it?
Do you actually know if the discounts you're offering indeed brings you more business?
So what should you do?
Well, make a plan.
Here's some questions that can help you with it.
1) Have you planned and budgeted for this discount?
If so, you might go ahead. If not, think again.
2) Is this discount consistent with your brand and fair to all?
Think of brand. Does premium and discount go together well? Will you keep your most important partners happy – or are you undermining your relationship with them?
3) Are you panicking?
If so, breathe. Think it over. Do the math. Come up with a strategy, not only for now, but also for next year. And if that all looks good, but only then, go ahead.
4) Do the numbers (still) make sense?
You made a budget. Maybe you even made room for some discounts. But do those number still make sense? Or have other costs already eaten into the pocket you planned for discounts?
OK, I've decided I'm not going for discounts. What now?
Just for the record, I haven't told you not to discount. I've just asked you to think it through.
But since you've asked, I'd say you have three options.
Option 1: Focus on your value.
Rather than shouting about your low prices, shout about how well your students are doing.
Option 2: Invest in marketing.
Take the pot of money that you would've said no to when discounting, and spend it on marketing.
Option 3: Wait and see.
Arguably, this is the riskiest of all – but there is value in letting the dust settle and reevaluating in a couple of weeks.
Need more advice?
If you need more help in deciding where to focus your marketing & sales activities and budgets, and/or in setting your new strategic direction, and/or you just need a sounding board, I'm here to help.
And I'm now offering 50% off on my consultancy services...
No discounts, sorry.
Just calm, practical advice that helps you get the results you need.
All right, all right, the first chat is still free.
