Should you discount your handmade products?

May 23, 2017 | Marketing Tactics

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Some people will tell you that discounts aren’t really good for your business, and make your brand and your products look cheap. Others are going to tell you, “Well, promotions and sales work, so why wouldn’t you discount your products?” So…should you discount your handmade items? And if so, what’s the right way to do it?

You can watch the video, or read the post below.

1 – The Cons of using discounts


First, we need to talk about the difference between a short term gain and a long term gain. Discounts help move your sales forward on the short term, but that’s mostly it. They provide a short-term lift while making your total revenue more volatile and less profitable.

Discounts are addictive

Studies also show that discounts are highly addictive. That’s 101 Consumer Psychology. If you use discounts too often, your customers get used to it, and might never be ready to pay the full price for your products.

Perceived brand value

A lot of experts will also tell you that discounts actually decrease what’s called the perceived value of your brand, and your products, meaning that in the eyes of your customers, your brand and your products are worth less than what they actually are, because they’ve been exposed to too many discounts, promotions, and sales. This can show a lack of confidence in your brand and products and can, in the long term, really hurt your sales.

As much as you can find studies and data showing that sales are bad for business, you can also find a ton of evidence showing the exact opposite.

Sales, discounts, and promotions work. In these days, sales are mostly expected. Black Friday sale, end of season sale, Mother’s Day sale, Valentine sales. People expect to get a discount or a nice offer at certain times of the year. Let’s look at the upside of using discounts for your business.

2 – The pros of using discounts

Moving stock and inventory

Sales and discounts are a great strategy to move your stock and inventory.

If you have some products that you weren’t able to sell this year or this season, discounting is a great way to actually sell those leftover products, and reinvest that money in your next collection or in your business in general.

new customers and customer loyalty

Discounts also offer a great way to get new customers to buy from you, and get them into your sales funnel by increasing your conversion rate.

Additionally, discounts can help you increase your customer loyalty and the number of repeat orders that you get from customers that already bought from you in the past, and are going to be more willing to buy again, if you use discounts strategically.

A good example of that is offering say, 10% discount on your store for one of your customer’s birthday. You could ask their birth date when they subscribe to your newsletter, and on that day, send them a nice little voucher to treat themselves to something in your shop.

3 – The right way to discount your handmade products

At the end of the day, you’re the boss, so you get to decide if using discounts is appropriate for your business or not, but if you do want to use them, here’s my take on it.

Avoid discounting the first order

Firstly, is don’t discount your first order. It gets your customers used to it straight away, and that’s really something we want to avoid. Instead, you could think of giving them a free gift with their purchase, or free shipping.


I know I sound slightly obsessed with pricing strategy and I talk about it a lot, but you have to remember that even when you’re discounting your products, you cannot lose money, and you still need to be making a profit.

You need to be clear on your pricing structure so that you know exactly how many more sales you need, to make up for the loss in profit due to the discounted price.


You also need to have a good reason to discount your products, and you need to make that reason clear to your customers through your marketing.

That’s because we don’t want your customers to think that your brand or products are cheap, and for that, they need to understand why the products are being discounted.

Is it because it’s Black Friday? Is it because it’s Mother’s Day? Maybe it’s an end of season sale. Whatever your reason, be clear about it and set some boundaries to your sales and promotion as well.

Set boundaries

By boundaries, I mean, do not discount all the items on your shop at the same time, because that would be a clearance sale.

Instead, set the sales on only a few items, maybe on one collection, (if it’s an end of season sale for example) and again, communicate this clearly to your customers.


A great alternative to discounts is actually doing the opposite of discounting your products, and giving something for free every time someone buys your product full price.

I know this sounds crazy, but it’s actually a great way to not only make more sales, but also increase the perceived value of your brand and products in the eyes of your customers.

How does that work exactly?

Think about it. If you were to discount your product, and you were to lose $10 on average of each order, how about you spend those $10 on giving them a free gift. Let’s say you’re selling natural skincare products based on essential oils. Instead of offering $10 off each order, you could partner with another handmade seller (who would be making essential oils candles for example) and offer a candle for each purchase. That’s added value for your customers, and value that they didn’t expect.

It’s going to help you not only get more sales, but also increase the perceived value of your brand and products in the eyes of your customers.

It’s a great alternative to discounts, and something I would really encourage you to look into.

How do you use discounts in your business? Let me know in the comments!

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