[mailman]

Hey everyone!

I hope this makes sense, but I just wanted to see if I could start some sort of discussion regarding the practice of offering a discount; specifically in regards to marketing/advertising your services. i.e. 15% OFF! or $500.00 OFF your exterior estimate! etc.

In my experience, there seem to be two schools of thought:

1. NO! A discount effectively lessens the value of the service you provide, is transparent and adversley affects the bottom line.
2. YES! If a discount makes/helps my phone ring, then I'm all for it! People love the idea of getting a bargain, plus it helps keep my postcard/brochure/ad/door hanger in the drawer/on the fridge rather than in the trash can.

Now I know a lot depends on the offer itself, to whom you're marketing, how often, company identity and a number of other factors; but from a philosophy standpoint, is this something you and your company subscribe to?

In other words, what's your company philosophy regarding discounts? Love 'em or hate 'em?

 

[Tmrrptr]

Not being a union man, I guess I'm a discount painter.
On the other hand, I am not an extremely gifted artist or a speed demon.
Therefore, I remain a discount painter.
r

 

[straight_lines]

If you gotta eat, you gotta eat... right. I will do anything for a profit if I get hungry enough, but I have worked very hard to build a business of high end custom work.

I hope to keep it that way.:whistling2:

 

[Rich]

In other words, what's your company philosophy regarding discounts? Love 'em or hate 'em?

I offer them on postcards I send out each year. I also lower my rates for friends repeat customers occasionally. I don't have a "set" philosophy though. I offer decent rates to begin with, so I usually don't have to work too hard marketing with discounts. I find that it's usually the expensive guys who are offering discounts (which end up still being more expensive than others most of the time!)

 

[nlpaint]

I only think to know how dutch people think.
I think it depends on the kind of customers you have.

For example I sell a decorative paint for too many money as
an alternative for a worse mineral based paint.
Clients are older women with a lot of money who make eachother mad
about the 'great looks' of the product.
I send painters by plane to France with 5 liter of paint (around 2 gallons)
to have a wall paint in their second or third house....
That kind of people are not looking for a bargain, just the best.

But most of the people are looking for a bargain.

Other question;

Why is someone a discount painter if they arent member of the union?

 

[Tmrrptr]

There's a very real reason why you won't see many union shops doing residential work... $$$$
r

 

[Brian]

In principle, I am not opposed to discounts. I think a more "retail" approach could be a huge marketing bonanza.

I've seen other contractors in my market take a retail approach. I don't know if they are making money, but they are visible everywhere and I must assume they get a lot of leads.

A service business needs leads. Certainly we want a specific kind of lead, but we can often sell a job even when the customer doesn't fit our profile. In my book, a lead is a lead-- someone wants painting and I offer painting. What happens from there is up to me.

I've offered discounts in the past with pretty good success. We used to do a Winter Coat Sale-- I'd sell winter work in the summer and fall for a 10% discount. It worked well for both parties. I've discontinued it because I get enough leads during the winter that it isn't necessary.

Bottom line-- discounts can be a very good marketing strategy if you know your numbers and the discount still makes the job profitable. If you are using discounts to buy jobs, you'd be better off working for someone else.

Brian Phillips

 

[paintbiz]

:cowboy: Instead of offering a percentage off - how about offering a FREE service. People love FREE much more than 'off'. I'm thinking about a Free paint offer over the slow winter months. Summer might be teaming up with local window washer for free 1st story window cleaning.

 

[T200]

I tyically offer discounts on all work during the winter months.
Even if the profitability is negligible, it pays the bills and keeps my painters (guys I do NOT want to lose) busy.

The "Free" idea is good too. People are attracted to "free".
I know one guy who offered "free paint" with any exterior repaint. He offered SW's A100 for "free" and said he was able to "upsell" many of the customers to SW Super. That offset the "free paint" offer a bit. I've also seen "free pressure washing" and "free gutter cleaning".

 

[plainpainter]

Isn't offering discounts really just adjusting your price to meet the market? If you are using discounts - it's my opinion that are only using price to get jobs. I go to a job, thinking how much I want - and then add a certain percentage - and then if they want to ****er - I let 'em - knowing I am getting the price I want anyways. Heck - I've gone to jobs, and the homeowner doesn't want the ceilings painted - and I give 'em an estimate that would have included painting the ceiling anyways - and if they pull a fast one on me - and ask how much I will deduct if I don't paint the ceilings - even though I just handed an estimate - I tell 'em nothing, that I include a 'free' ceiling paint in every estimate, it's there if you want it or not - hee hee h ehe hee haha ha a. You gotta play games to survive in this business, unless of course they pay you Time and materials - then it's 100% honesty - as those customers respect you the most.

 

[Tmrrptr]

I like that FREE PAINT idea...
r

 

[T200]

Isn't offering discounts really just adjusting your price to meet the market?

Yes, and that's why I offer them during the winter months, when it's slow.

If you are using discounts - it's my opinion that are only using price to get jobs. I go to a job, thinking how much I want - and then add a certain percentage - and then if they want to ****er - I let 'em - knowing I am getting the price I want anyways.

Supply & demand are at work.
In the winter, many people are getting ready for the holidays and don't want to mess with painting. Or they can't open windows and don't want to smell paint fumes. The discount could make a difference. And I've found the discount makes a difference for some customers I've previously quoted.

Heck - I've gone to jobs, and the homeowner doesn't want the ceilings painted - and I give 'em an estimate that would have included painting the ceiling anyways - and if they pull a fast one on me - and ask how much I will deduct if I don't paint the ceilings - even though I just handed an estimate - I tell 'em nothing, that I include a 'free' ceiling paint in every estimate, it's there if you want it or not - hee hee h ehe hee haha ha a. You gotta play games to survive in this business, unless of course they pay you Time and materials - then it's 100% honesty - as those customers respect you the most.

Idunno.
Sometimes playing games can come back to bite you.
Let's say that customer refers you to a friend and tells the friend: "Tell him you only want the walls painted because he'll throw in the ceilings for free."

 

[plainpainter]

Well that's easily solved - price the ceilings in anyway, even if they tell you they don't want them painted. And if they surprise you, no skin off your back, you already priced 'em in. Think of it as a hidden savings code, if a customer calls you on it - whatever, it may only happen once or twice. Heck - you know those, 10% special offers? Well think of that as your 10% special offer - that you give to those clients that ask. Giving customers extra 'value' or at least making them think so - will make 'em feel better. And in the end - no matter what I use to think, it's making the customer feel 'good' is what is most important. I have left jobs where the customer received paint jobs that were of paramount quality - yet they weren't happy with the experience with me, other painters have done quite ordinary work - yet, they left the customers beaming! Who do you think got the call-backs?

 

[porkchop]

The offer should be based on the needs in your market. I used to own a landscape company (sold it!) and we did a Holiday decorations promo and offered a free decorated wreathe ($100 value) and not one person even asked about it. I was young and nieve at the time. I was putting up Christmas lights for $2K a house, these people didnt need coupons. They wanted the best service.

So find out what people in the market would want, are they cheap or like to buy the most expensive thing they can? Giftcard to store or resturant? Ask your past customers what they would want, then offer it to them for a referral. Just shooting out some ideas and some things I have learned through my businesses.

 

[Brian]

You gotta play games to survive in this business, unless of course they pay you Time and materials - then it's 100% honesty - as those customers respect you the most.

First, I'm not trying to survive. I'm trying to thrive.

Second, in 21 years in business I haven't found it necessary to play games or be anything but 100% honest. Neither business nor life is a game, and to approach either with anything less than 100% honesty is-- well, dishonest.

Third, how is a customer asking to deduct the price for something they don't want done "pulling a fast one"? It seems to me that you are the one pulling a "fast one" by telling them it is "free" even though you built it into your price.

Fourth, I fail to see how T&M is honest, but a flat price isn't. Perhaps you could enlighten me.

Brian Phillips

 

[Rich]

I was putting up Christmas lights for $2K a house

Please tell me you're still doing this

 

[Rich]

First, I'm not trying to survive. I'm trying to thrive

this is why I may be leaving the painting business

 

[Rich]

Neither business nor life is a game, and to approach either with anything less than 100% honesty is-- well, dishonest

You're a good man Brian. I appreciate your moral views on things, and I try to be like this myself. Sometimes I slip up, of course, but I am only human. I also appreciate you voicing your views as well.

 

[porkchop]

Please tell me you're still doing this

Actually I sold my lighting business to a friend of mine, who was also in the business. He has been doing it for close to 10 years now. He has close to 400 accounts, you can do the math.