Are You Deep Discounting? Maybe You Shouldn’t Be

Posted on by Beth Negus Viveiros

Deep discounting may be getting you quick returns—but it may also come back to haunt you.

Product devaluation due to deep discounts is one of the biggest problems facing merchants today, Russ Gaitskill, president and CEO of Garnet Hill told attendees at NEMOA’s spring conference in Boston last week.

“If I have a cashmere sweater that I’m selling for $150 and the price I have to discount to is $90, there’s a problem,” he said. “NBC reported that on Black Friday the average apparel firm discounted prices 36%—and that’s not sustainable.”

Marketers must know their true “out the door price” and plan accordingly, Gaitskill said. The only true defense to this kind of deterioration is true differentiation—marketers should strive to offer products and services that mean something. Think more Apple than JC Penney, he said.

Another major problem is an increasing inability to communicate directly with consumers, he said, noting that when he started in the business, the messages and when consumers received them were controlled by marketers. Now, the consumer is control.


Over half of your customers are likely only really seeing 15% of your contacts, which means marketers must look to alternate ways of  connecting, he said. Customers might be deleting your emails when they pick up their phones first thing in the morning, so consider other media such as direct mail or outdoor advertising to  stay top of mind.

And don’t forget to engage with your audience with games, loyalty promotions and content. “Do anything you can to create a connection with your brand,” said Gaitskill. “[Use content] to improve the relevance of your email to increase opens and reduce opt-outs.”




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