Sale and discounts raining this monsoon, go get your deal

Marketing has always been a domain of hyperboles and superlatives – best deals, throwaway prices, highest discounts, biggest drop in prices, once in a lifetime opportunity and the list goes on. The economic slowdown during the pandemic has turned the country into a veritable discount republic.

Everything that’s up for sale, seems to be at a heavily discounted price. From shoes to apparel, eateries to airlines everything was/is available at hefty discounts – often deep discounts – so that manufacturers and marketers could keep their heads above water.

Though they began as a marketing tool, now the appetite for discounts seems to have become a countrywide phenomenon – a potent dope that is getting the consumer more in its grip than the product for which it is offered.

Bhai, koi discount dede

Recently in a front-page advertisement on Sunday, food aggregator Swiggy admitted that their 4,508 customer care representatives constantly face consumer calls urging “Bhai. Koi discount dede” and “Any good discounts?!!!…Or”.

At the end of the text, Swiggy did not forget to reiterate that they are offering up to 60% off on top food brands of the city.

Food entrepreneur Jayanta Banerjee, who worked for 26 years in hotels such as Hyatt Regency, Holiday Inn and The Lalit Great Eastern before opening a diner 37 Relish Route in south Kolkata in November 2020 vouches that most customers start salivating at the mention of discounts.

“I can say from experience that if a restaurant sells a big fish fry for Rs 200 and another sells two much smaller ones for Rs 100 each, people would be inclined to visit the latter, not stopping to think that the two smaller ones don’t add up to the weight of the bigger one,” says Banerjee, who has prepared an advertisement offering discounts of 10%, 15% and 20% depending upon the order value.

Exceptions

The only exceptions to this discount raj were perhaps consumables, devices and medicines needed for the treatment of Covid, monopoly utilities such as electricity and, you guessed it right, petrol and diesel.

Though discounts, unfortunately, stopped short of petroleum products, they are virtually raining everywhere, even in the most unexpected areas. In mid-June Ambience Mall in Gurugram began offering free parking and discounted rates on various brands available in the mall to healthcare workers. Watering holes offered hung up placards conveying special discounts to those who had taken Covid vaccines.

Watering holes

And that was not an exception. Cyber City in Gurugram offered as much as 50% discount to those who got two jabs and 25% to those who got one.

If Coronavirus was a great leveller, discounts were the much-preferred gun marketers loaded to trap customers in times of diffidence.

In the west, customers were wooed with free beer, tickets to cash lotteries and free burgers to overcome vaccine hesitancy. In India, vaccines made strange bedfellows with a couple of banks even offering slightly higher interest rates on deposits.

Banks too

Banks are one of the most unlikely entities to be associated with discounts.

But in the first week of June, Kolkata-based public sector UCO Bank that is not known for the best of customer-friendly initiatives hit upon the startling plan of offering 30 basis points of an additional interest rate for deposits on 999 days for those who received at least one shot of the vaccine.

Central Bank of India launched Immune India Deposit Scheme with 25 basis points of additional interest to those who took the jab.

In the last week of June, the country’s biggest airline IndiGo said in a statement that it was offering up to 10% discount on fares to anyone who got a single jab.

McDonald’s went for a 20% discount on meals for those who got the vaccine.

Dawn of discounting

Discounts as a weapon of sales promotions were first used 134 years ago when Atlanta businessman Asa Candler hit upon the plan to raise the sales of Coca-Cola, according to an article in The Time in 2010.

“Candler’s invention transformed Coca-Cola from an insignificant tonic into a market-dominating drink. His hand-written tickets offered consumers a free glass of Coca-Cola, then priced at five cents. Between 1894 and 1913, an estimated one-in-nine Americans had received a free Coca-Cola, for a total of 8,500,000 free drinks. By 1895, Coca-Cola was being served in every state,” stated the article.

But marketers really jumped on to the discounts bandwagon during the Great Depression when sales plummeted across the board.

Target online

In the 1990s the internet led to another discount coupon revolution with online coupon codes.

However, there is a huge territory for discounts even beyond the vaccine raj. Just about everyone, irrespective of whether pierced with the needle or not, can just walk into any store and expect discounts.

Log in to all major online shops such as Flipkart, Amazon, Myntra and you would be bombarded by phrases such as “min 60% off”, “60-70% off”, “up to 35% off” and “up to 50% off”. They apply to apparels, consumer durables, ACs, cricket bats blue tooth speakers, skin and haircare products, shoes and in fact anything.

There is not a single brand like Wills Lifestyle, Levis, Vero Moda, Tommy Hilfiger, US Polo Assn, GAP, Nike, UCB, Puma that is not offering price reductions upwards of 30%.

Hidden discounts

There are a class of manufacturers/retailers who cloak discounts in other forms.

“I did not offer discounts per se both during the first and second wave. But I desisted from raising prices though prices of raw materials such as chocolate bars, raw fruits and aamsatta (mango papad) rose 10-12%. You can construe that as an effective discount,” said Madhumita Upadhyay, who set up Mad Chocolates four years ago. She has two outlets in two prominent shopping malls in Kolkata.

“We operate on wafer thin margins. Offering discounts would make the business unviable,” she said.

The psychology

Discounts can be viewed as a democratic avatar of the faculty of bargain hunting that some are gifted with. Bargain hunting is such a compelling urge among a large section of people that even tourist guide publications and websites flag such zones as bargain hunters’ paradise.

Every city has more than one of them – Chandni Chowk and Janpath in Delhi, Gariahat and Hatibagan in Kolkata, Chor Bazar and Fashion Street in Mumbai.

But everyone is not a great bargain hunter – most women are somehow born with it – and discounts obviate the need for acquiring the skill, providing a level playing field for all.

Applied psychologists tell us that bargain hunting helps to shed a burden of guilt that is associated with the purchase of the item in the first place.

But they can also be addictive. In his article “Can Bargain Hunting Be Addictive?” in Psychology Today, Dr. Mark Griffiths mentions, “Bargain hunting may save money, but for some people, looking for the next ‘great deal’ becomes an addiction.”

Any damn fool

While discounts do push up sales in the short term, for the marketer they can also lead to a classical trap. Sales can taper off when discounts are withdrawn.

But then, in periods of economic slowdown there is hardly a brand – perhaps with the exception of Apple – that is staying away from discounts completely.

“Any damn fool can put on a deal, but it takes genius, faith and perseverance to create a brand,” said David Mackenzie Ogilvy, the most famous advertisement professional of all times.

For the time being, till incomes rise again and jobs return to empty hands, till consumer confidence languishes at low levels and aggregate demand continues to suffer, ‘damn fools’ would rule the market.

Last word

A few online shopping sites have started offering discounts on hand sanitisers too.