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To survive in the e-commerce market where there is fierce competition among retailers, you need to innovate your marketing strategies regularly.
One of the most effective strategies used by Shopify store owners is quantity breaks. It not only helps increase sales for your store but also increases customer satisfaction.
This article will help you understand the importance of quantity breaks and guide you to exploit the potential of this strategy to the fullest. By applying this knowledge to your business, you can make more profits and gain a loyal customer base.
Table of contents
What is Quantity Breaks?
Quantity Breaks allows you to create increasing discounts based on the quantity of a product your customer buys.
For example:
If a customer buys your product with a quantity between 1 and 4, the price is $99.99 each.
If they buy a quantity of 5-9 they are $79.99 each, if they buy a quantity of 10 or more they are $59.99.
This can be applied to a single product, or a group of products (ie. buy any 5 t-shirts, get a price break).
Thanks to this strategy, customers are encouraged to raise their volume of purchases to take advantage of higher savings.
The Psychology Behind Quantity Breaks
Research suggests that consumers tend to purchase more in quantity because they realize
Research suggests that consumers tend to purchase more in quantity because they realize that they are getting a better deal. In fact, quantity breaks can be considered a form of psychological pricing, which is a marketing strategy that takes advantage of the psychological reactions of buyers.
This tactic is based on 2 key psychological principles:
Perceived Value: When consumers perceive that they will get a better value for their money, they tend to buy larger quantities to get this value.
For example, a client may feel that they are getting a good deal by purchasing three products for $30 rather than buying one product for $15. Although the total cost is the same, the perceived value is higher with the quantity discount.
Sense of Urgency: Quantity breaks create a sense of urgency in customers, making them feel they need to take advantage of the offer before it expires or the stock runs out. This strategy encourages quicker purchasing decisions and can boost sales.
Benefits of Quantity Breaks on Shopify
1. Increasing Average Order Value
A paramount benefit of using quantity breaks is its potential to enhance your average order value (AOV). This strategy enables you to encourage customers to purchase more items per transaction to get discounts. As a result, it transforms a potential single product purchased into two or even multiple then boosts your AOV effectively.
In addition, offering quantity discounts also encourages buyers to look into goods they might have yet to consider. You can convince customers to try more items from your store by showing them the money they could save when purchasing in bulk.
For example, in a cosmetic store, customers would buy one serum that costs $40 in normal. With quantity breaks, the offer could be 2 for $75 or 3 for $100. As customers see the advantage of buying more to get a discount, they might choose the higher quantity, thus increasing your AOV.
Read more: Shopify Product Bundles: The Secret to E-Commerce Success
2. Inventory Management
For retailers, managing inventory is a big challenge, especially for products that are overstocked or seasonal items and perishable ones. With quantity breaks, you can speed up the sales of these products, make your inventory always fresh, keep down holding costs, and prevent unsold stock.
For example, If you have a lot of designer Christmas socks leftover, quantity discounts can help you clear them off the shelves much faster.
3. Customer Retention and Loyalty
Quantity breaks are an excellent strategy to foster customer loyalty. Indeed, as customers realize they might get an attractive deal, they are more likely to continue purchasing from the same business in the future. By providing value, you not only can build long-term customer relationships, but also increase the likelihood that they will return for future purchases.
For example, a person who regularly buys dietary supplements is likely to return to the store when it offers discounts on bulk purchases. This strategy attracted them by helping them save a part of the cost with regular purchases.
Using Shopzon Product Bundles to Implement Quantity Breaks in Shopify
Shopzon Product Bundles is one of the best apps that you can use to implement quantity breaks. It allows you to create bundles and offers to increase your revenue and average order value (AOV).
Step 1: Install Shopzon Product Bundles app.
Step 2: After installing the app, create a bundle on the Homepage.
Step 3: Choose a specific product, collection, or entire store.
Step 4: Select a template for your bundle.
Step 5: Customize your discounts (bundle title, offer title, quantity,…)
Step 6: Press “Save & Publish” and start tracking the result!
Maximize Impact of Quantity Breaks
1. Pricing Strategies
You need to have an effective price strategy to make quantity breaks attractive to customers and increase profit for your company.
For instance, if you are a fashion store owner, you can set the price of a t-shirt as $20, 3 for $55, 5 for $95, or buy 10 at $185. This pricing strategy encourages customers to believe they are getting a bargain, leading them to purchase more in each transaction than they initially intended.
Following these steps:
- Researching prices from competitors to know how much customers might be willing to pay.
- Testing different price structures to determine the most successful ones.
- Using A/B testing to compare the effectiveness of different pricing strategies.
2. Marketing Tactics
Advertising your quantity breaks effectively determines much of the success of this strategy.
For instance, highlighting the benefits of purchasing in bulk in your email campaign can help you attract customers to your online perfume store. Additionally, you can post on social media about the cost savings and convenience of making a large purchase which can drive more traffic to your website.
Following these steps:
- Send emails to potential customers to introduce the benefits they will get when buying products in bulk.
- Use attractive images and persuasive copy to feature quantity break deals on social media.
- Ensure your quantity breaks offers are highlighted on your websites such as the product page or checkout page.
3. Analyzing & Adjusting
To optimize the effectiveness of quantity breaks, you have to constantly analyze and tailor its strategy to suit your goals at different times.
For example, you are an owner of a bakery and discover that quantity breaks on certain products do not attract customers as you expected. After studying the statistics, customers tend to buy multiple ice cream sundaes in one transaction. So, you decide to create a program where the more you buy, the bigger the discount to motivate customers to buy more cakes. This method not only helps you increase revenue but also meets customer needs.
Following these steps:
- Manage the sales performance of the products on quantity breaks carefully.
- Receive and analyze customer feedback frequently to know what they think about your offers.
- Use customer data to adjust your quantity breaks based on it.
Advanced Tips & Tricks
1. Segmentation and Targeting
Identifying your goal and customer segment is essential to improving quantity breaks effectively.
For instance, in a jewelry shop, there will be two main customer groups: couples and singles. Offering quantity discounts tailored specifically for couples and singles will make your offers as appealing as possible to each customer segment.
Following these steps:
- Your sales data and customer analytics can help you identify different segments within your customer base.
- Adjust special quantity break offers to the needs and buying patterns of each segment.
- Using targeted marketing strategies, such as segmented email lists or target ads to promote these offers directly to the relevant customer groups.
2. Seasonal and Tactical Uses
Using quantity breaks in different seasons or for each business purpose will help you achieve greater efficiency.
For instance, a fashion products retailer could have promotional sales of special bulk prices on short clothes during the summer months and coats in the winter. Similarly, for overstock or out-of-fashion items, volume discounts can clear inventory quickly and effectively.
Following these steps:
- Manage inventory levels, especially for seasonal or overstocked items, by utilizing quantity breaks. Make these offers during peak shopping periods such as holidays, back-to-school sales, and Black Friday.
- Control inventory such as seasonal or overstocked products, and make quantity breaks.
- Offer your incentives at times when customer shopping needs are higher like holidays, Black Friday, or back to school.
Conclusion
In conclusion, offering quantity breaks will bring a variety of benefits to your e-commerce business. It’s demonstrated by sales data and customer feedback.
Additionally, by combining appropriate pricing strategies and innovative promotional tactics, while constantly evaluating and adjusting your approach, you can maximize the advantages of quantity breaks. Ultimately, it will help you improve your average order value and increase your profit significantly.
