Apr
09
2014
DISCOUNTS, BONUS AND ANSWERING PHONES!
Written by Michael J. Clark and Lori Shecter

Discounts Blog

Answer Your Phone

One pet peeve of mine:  Frequently when I call a dance studio an answering machine answers. I know you all have lives, but, if I am a mom, I want an answer NOW, I will wonder at no one answering the phone.  Seriously.  PLUS, some studios have messages from AUGUST 2013.  I can give you 1000 words of advice, but perception is reality!  GET A CHEAP answering service to answer the phone, or CALL FORWARD to your CELL phone.  Rant over….

Discount, Bonus's and Consumer Behavior

Discounts, bonuses, or specials can help increase enrollment.  However, choosing the right rates at the right time makes all the difference.  Modified prices are most effectively used as rewards to existing customers whom you would like to thank or as incentives to new customers, especially those who may be comparing your prices to your competitor. 

Discounts, bonuses, and specials are not the only way to stay competitive in the market; convincing consumers your higher price is for a better product will give you a leg up on the competition. 

Here's  how discounts, bonuses, and specials can help you target the financially conservative customer as well as influence increased enrollment among your current students.  Our tips will show you how to achieve a particular consumer behavior using price modification.

BEHAVIOR: INCREASE ENROLLMENT AMONG CURRENT STUDENTS

Convincing students (and their parents) to enroll in more classes can be tricky, but offering a ONE TIME incentive can convince them to take advantage of the offer.  Make sure your offer is only good for a short time period- SIGN UP BY: MARCH 15 (for example).  To increase cash flow, make sure that all specials are PAID IN FULL.  No cancellations.  That way you limit your cash flow liability. Sales that have time limits are always more powerful than an ongoing special:

Examples:

  1. GO EASY:  Tiered discounts:  add a 2nd class, save 5% on that class, or a 3rd class 10%.
  2. GO CRAZY:  BUY ONE ADDITIONAL CLASS GET ONE FREE. (BOGO)This can encourage sampling.  Again, must be completed within a certain time frame. OR Buy 1 more, get one at 50% off!)  There are reasons that retailers have these specials.  It is because they WORK to increase sales. 
  3. GO INSANE!  One of our studios has buy 1 extra class get a 3rd class for $1!  It has increased her enrollment by 25% during this crazy offer period.

REWARD DEDICTATED STUDENTS

We all love the dancer who shows up to every class and takes as many as they possibly can.  However, the hungriest dancer does not always come with an unlimited budget.  These dancers are your can be your advocate and role models and will improve the attitude and work ethic of any class they attend. 

  1. BRAND ADVOCATE:   Spread the word. Expanding to your students’ friends is one of the quickest ways to grow your business.  Offer a bonus for any dancer who brings a friend; also offer the same bonus for the friend they bring.  For example, bring a friend and both of you receive a 25% off bonus for one month of all of your classes.  Giving the bonus to both the new student and your current student is an excellent way to reward both customers.  If this special is abused limit how many friends a year you can use this special with
  2. INCREASE NEW STUDENTS: If you are looking to greatly expand, there are a few different options for price modification that can greatly increase incentives to enroll.  Try waiving the new student registration fee, or give a significant discount (Tip: If you would like to charge $30.00 for new students, advertise by saying you are giving 50% off new registrations, mentioning the usual price is $60.00)   Also offer discounted or free first time trial classes in which you show the student how wonderful your product is.  Lastly, try accepting new students throughout the year by having a special class which does a very short recital dance that you can put together using the basics as late as possible.  This way, late comers can still participate in the recital, attend the recital to see what they could grow into with your studio, and you never turn away a customer potentially into your competitor’s hands.
  3. TAKE ON YOUR COMPETITOR: It is important to know your competitors’ prices as most parents will enquire about the price and want to understand what “bang” they are getting for their “buck.”  If you feel a competitor is offering prices that are more attractive, run a ONE WEEK special that brings your prices to match yours.  OR don’t!  Play up the features that your studio offers- teachers, facility, camps, etc. that the other program doesn’t have.
  4. GUIDE YOUR STUDENTS TO IMPROVE THEIR WEAKNESS AND YOURS! Most studios have a weakness, whether its ballet, tap, hip-hop, or any other style.  One way to incentivize your students to improve their weaknesses is to offer specials for existing classes where your studio is weak.  For example, if your students shine in hip-hop but need more ballet technique, offer every student enrolled 10% to 30% off ballet classes.  This will guide them to improve on their weak areas, and while it may be a cost to you it will improve the overall performance of your studio, the quality of your recital, the quality of your dancers, and if you are a competitive studio it can really impact your performance at competition positively.

Understand that discounts, bonuses, and specials are not meant to downgrade what you do, but rather guide customers towards the behaviors you desire.  Ask yourself “how can I get my customers to behave a certain way? “ and then design your discount program based on that. 

AND, when that phone starts ringing, make sure that someone answers it! Or, better yet, get online enrollment with School Empower software to capture that impulse buyer!

USE SCHOOL EMPOWER DANCE STUDIO SOFTWARE TO SET UP DISCOUNTS. CLICK HERE to start your two month free trial today.