Creating a discount system for an online store

    imageOne way or another, our entire social life is built on communication, the provision of services and goods. In this process, we give and receive discounts, do something with a backlog for the future or take loans. In the process, we accumulate discounts on services and give them to people ourselves.
    My task is to create a discount system for an online store, the purpose of which is:
    1. To increase customer loyalty to make purchases in the store.
    2. Increase the number of repeat orders.
    3. Maintain a database of customers making purchases in the store more than once.
    4. Calculate everything so that the store’s discount system increases the company's revenue and is not unprofitable.
    5. Implementation.

    I propose to consider each of the points in the key to solving the set goal and choosing the most optimal option. I have a little experience in these matters, but I have a great desire to fill these gaps.


    1. Increasing customer loyalty.
    The growth of online sales increases competition, which allows customers to choose a store where you can make a purchase. There is, of course, the problem of dumping in the market, but this is a completely different topic regarding service, the quality of services and goods, which can be devoted to a lot of time and go beyond discussing store discounts. A huge role in sales is played by a sales assistant, who, within the framework of his authority, can give a customer a discount and encourage him to make a purchase in your store. The presence of a discount system only formalizes what the consultant knows, and will convey this information to potential buyers with all the details and conditions at any time of the day. Thus, it is possible to interest people in need and interested in the repeated use of our services.

    2. The increase in the number of repeated orders suggests that actions aimed at a long-term presence in the market have begun to bear fruit.
    There is the 20/80 principle, or the Pareto rule, formulated by the Italian economist Wilfredo Pareto at the end of the 19th century, which is still applicable in many areas of economics and management. It says that 20% of the effort gives 80% of the result.

    At the moment, repeated calls to the store no more than 5-7%. Discounts and discounts are aimed at increasing the number of repeat orders and bringing it to at least 10%, and in the future - 15-20%.

    In addition to the repeated appeal, I see another fat plus in the fact that you can give a discount card to your brother, neighbor, friend, colleague and push them to make a purchase from us.

    3. Maintaining a customer baseowning special shopping conditions.
    This will provide more information and statistics on re-orders, will allow you to calculate the real benefits of this system, perform after-sales services and conduct promotions for such people on special conditions.

    4. The most interesting in the calculations: to whom? for what? on what terms?
    At the moment, I saw two main ways of maintaining the system:
    1. Accumulative bonuses that can be used to place an order in the store.
    What this method gives is:
    - bonuses can be used to make purchases only within this discount system. They can not be taken and spent on something else. This is a flaw for the client;
    - if a lot of bonuses accumulate in the hands of the client - this can lead to the fact that you have to give him the goods in the form of a “gift”. From the point of view of finance, nothing changes, however, peaks are possible when a lot of bonuses will be used and the amount of money in circulation can decrease sharply. Minus for the store;
    - the client needs to bathe about bonuses, subtract, calculate. He may want to buy the goods simply cheaper, and spend the rest on another service that the system does not provide (although there are systems where service packages are very diverse)
    - the accrual of bonuses by managers can cause some difficulties and confuse when placing an order.

    2. Discount for making a purchase:
    - the client pays less money and does not worry about hypothetical bonuses. He immediately sees that he paid less and he had money left;
    - Some suppliers require adhering to recommended prices. If the price is lower than the recommended price, the goods may not be accepted for service or accepted on a paid basis. Difficulties for the store. It is solved by introducing conditions on the goods of certain manufacturers. At the moment, out of 100 brands, only 4-7 require this and their products are expensive and rarely sold (although it would be very good for discounts on such products and in large amounts). Exceptions can be specified in the rules for using the discount .; - simple accrual system - all customer orders are summed up, depending on the amount of orders, a% discount is given.

    And I love
    tsiferki, I'll carefully sign it!))) 1-3-18-42? Such a question arises before calculating how much discounts can be given and for what amount.
    The main unit to which the discount applies is the order. It was considered incorrect and difficult for user understanding to introduce conventions on groups of goods, goods from different suppliers, etc. There should be simple digits without postscripts and 6 fonts under the order. A person takes away his discount from the amount on the website and gets the result. Since we want to work efficiently and honestly with suppliers and competitors, we decided to limit ourselves to exceptions for those cases where we cannot influence the conditions of the purchase: an exclusive supplier and requirements for the absence of dumping.

    To analyze the activity, I decided to calculate the average cost of an order in a store. The result is as follows:
    Order Amount, $% of total orders
    more than 4002.5%
    300-4002.5%
    200-3005%
    100-20020.5%
    40-20056%
    less than 40 cu13.5%.


    Next, I built a summary table about the fat on each order of the store. I consider Navar as the difference between the amount of the sale to the client and the amount of the purchase from the supplier without the cost of delivery, office, advertising, etc.
    Navar, $% of total orders
    more than 1001%
    80-1001%
    60-802%
    40-605%
    20-4019%
    10-2043%
    Less or close to 1029th

    Then he proceeded to the analysis of costs, which include:
    1. shop manager,
    2. shop assistant,
    3. courier,
    4. office content, telephones
    5. advertising.

    The bulk of orders is a profit of 10-40 cu Navara. Orders with a large fat - a priori more profitable. With less fat - home delivery is often included, which compensates for the costs. After analyzing the orders, I concluded that it is possible to average the order amount to 25 cu

    The courier makes about 8 deliveries per day (taking into account visits by suppliers, check-in at the office in the morning, which totals 12-20 points per day, geographically scattered throughout the city).
    I became interested in the cost of one average order for a store in a% ratio:
    - 17% for delivery (courier, fuel, depreciation)
    - 33% staff (calls, calling suppliers, availability, booking, placing an order, printing receipts, etc.)
    - 15%on advertising and office expenses. We have 65% of the

    theoretical efficiency in a vacuum of 99.9999999% . Thus, one typical order leaves 35% of the net profit in the company. If you think about any discounts to customers, then at the moment the maximum possible percentage of discounts is 5% . An increase in this threshold is possible if expenses per one order are reduced: one sales assistant can load more than one courier, increase the number of repeat customers, the store will be more known with age. The only thing left is to calculate the conditions for obtaining a card and changing the conditions of interest for the better.



    I believe that this can be adjusted for any online store, but I thought it would be profitable to make the conditions for receiving such:
    - purchases were made in the store for at least 400 cu
    - buy a card for a gift or for permanent use 15 cu Additionally, if the card is a gift, record on it the amount for which you can make a purchase. Money is given immediately to us. The discount does not apply to the gift amount. This is a kind of gift certificate and it is not decided whether it is needed and in what form.

    Tariff grid:
    Title% discountcondition of receipt
    After receiving the card3%Purchases starting at $ 400
    Average4%Purchases from $ 1,000
    Maximum5%Purchases from $ 2500

    5. Launching is possible in several ways: To
    resort to the services of discount clubs, choose a package of companies working on existing cards. It is good that the accounting and accumulation mechanisms are developed and debugged. Plus - the club owner is responsible for issuing cards, minus - these cards often need to be paid to the client and not all possible wishes of your store can be taken into account.

    Develop your own discount system. Complexity - the cost of software development, support, time for debugging and implementation. In the future, it is compensated by the addition of additional services at its discretion, flexibility in setting conditions, and independence from a third-party service. It is also required to design and issue discount cards and decide at whose expense all this will be done. But for me the last decision is beyond doubt - only at the expense of the store and only plastic cards with a unique number without reference to the name (hello to the neighbors!).

    It seems to me that having a discount system is not a silver bullet for increasing sales. Lack of responsibility for the quality of goods, service, courtesy of sales consultants, after-sales service and many other things will make it only an extra burden in a store that looks like a cripple and rather survives than grows and thrives.

    Thank you for your attention, I will gladly supplement and listen to criticism. Calculations and calculations were carried out at an intuitive level, therefore, there is the likelihood of errors or misconceptions in the issue of sales.
    Only by the results of 3-6 months I can tell how it was given and how it works.
    The store is located in Kiev, but I do not publish the link and subject for several reasons:
    • Habraeffect)))
    • the emergence of criticism about the icons, pictures, distracting from the discussion of the issue of the topic. I understand that usability, convenience and other important elements of the promotion of goods, but this is a matter of advertising and attitude to the quality of services provided.
    • this is a topic for the blog “I am PR”, which will probably be, but I have not yet found enough arguments in favor of writing it.

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