By: Jeff Magner
VP of Growth &
Client Strategy
Lately, there’s been a lot of buzz around the concept of “spaving” – the strategy where retailers encourage consumers to buy more to save more.
It is important to note that in many cases, spaving can be a win/win situation for both retailers and consumers. The retailer wins by selling more volume than they originally would have, even if it is at a slightly lower margin as a trade-off or investment. Meanwhile, consumers can walk away with valuable savings or incentives on products they genuinely need and want.
It’s essential to always offer your clients win/win promotions. While the concept of spaving inherently involves encouraging additional spending, promotions with integrity and trust will shine through, assuring customers that you are not merely trying to exploit them.
Here are a few ways to ensure your promotions are trustworthy:
- Add Consumer Value: Ensure every promotion you offer adds genuine value to the consumer.
- Clear Communication: Explain your promotions in clear, understandable terms.
- Offer Real Value: Provide products or services that are recognized and valued by everyone.
In a world where some retailers raise prices just to create a seemingly attractive discount, consumers can often feel uncertain about the true value of the savings. To avoid this, offer rewards that are clearly valuable, such as Mastercard Rewards Cards or other well-known gifts. If a customer receives a $100 Mastercard, they know its value and can use it as they wish. Similarly, items like a Stanley Cup, a Yeti Cooler, or a pair of AirPods have clear, recognizable value.
Providing brand-name quality products that consumers seek and enjoy proves that you are looking out for their best interests.
It’s important to recognize that some spaving promotions can sometimes lead consumers to spend more than they intended. This can be problematic if they exceed their budget or purchase items they don’t need or won’t use, especially if the products are perishable.
However, spaving can be great for everyone if done wisely!
Savvy consumers who find truly fantastic offerings will enjoy the real benefits of spaving and will join the ranks of the wise who win every time.
