Do brands pay a price for discount culture?

By Susan Riley, Head of Think Stylist

How do you feel when buying something that’s  on offer? Triumphant? Lucky? Uncertain? Guilty? 

We all appreciate getting something for less – be it a labels-still-on Massimo Dutti trench on Vinted or a Homesense Armani Casa rug – but as women increasingly try to balance intentional purchasing with making their money stretch further, what kind of discounts are landing well and which brands are making us shop versus stop?   

Even outside of the purposefully bargainous retailers (the Costcos  and B&Ms, as well as the under-restructure Poundland), discounts are everywhere – most now disguised as membership schemes and loyalty cards, with brands battling hard for customer loyalty and consideration with offers of sign-up seniority and perks.   

In these instances, we see women indulging if a) they already have big love for the brand in question and want to enjoy it more often for less (case in point:  Joe and the Juice’s gamified tier reward points),  or b) they can see clear added value and will pay an ongoing fee to secure it (our Thinkfluencer  Chloe- a member of Think Stylist's ethnographic panel- loves Cineworld Unlimited from £12.99,  which allows her a low-cost weeknight activity at a time when social spending is sky high).  

Any discounts that attempt  to carve her out as an individual also win. H&M members get a 25% discount on an item around their birthday as well as early access to sales – akin  to getting a private view before an exhibition opens to the public.  

It’s  a nice touch, as is creating a memorable discount franchise.  Take Boots’ £10 Tuesdays – a  regular opportunity to check back in to see if your  favourite skincare products might be on offer that week, which was  another example referenced by our Thinkfluencers. It’s  a  great example  of how cut-price products can be transformed into aspirational 'Why not?'  habit building. 

Then there  are  the brands that have successfully built their whole identity around delivering luxe for less. Disruptive beauty brand Beauty Pie focused its  2023 'No catch'  campaign entirely on its accessibility and affordability, with statements like “Our prices make other beauty brands blush” and “Luxury beauty doesn’t have to be a squeeze” emblazoned across brushes and bottles to classily suggest that other luxury beauty is a rip off. The Ordinary,  too, by singing about its ingredient simplicity, remains  aspirational while proudly positioning itself as a low-price, value-packed brand.  

With so many flattering discount strategies being deployed (even a discount code can seem decadent if done in the right way),  consumers are very comfortable  with, if not expectant of, being incentivised by brands. It’s  why only 21% of Gen Z and millennial women are put off by frequent promotions due to them  shifting their perception  of a brand’s quality. More women do have a shift in value perception,  however, with 56% saying that regular promotions make them less willing to pay full price when purchasing  with that retailer. Think back to The Gap trap:  a brand that started off famous for quality staples and then struggled to recover from a deluge of constant discount sales.

Also  a massive promotional ‘no’  is anything that actively encourages overconsumption, the chief culprit being Black Friday. Only 6% of women love Black Friday and use it to do their Christmas shopping, while 27% actively avoid it. And all those in between? They either browse but don’t  buy or make a considered purchase of something they have wanted for a while and have been waiting to be reduced.  

Nor is Black Friday perceived as good value. Only 2% of women have saved themselves a lot of money from a  Black Friday  deal, 40% think Black Friday is purely marketing hype and just over half have bought something they didn’t  need. This is not the dream for a cohort who started this year tracking and accounting for their purchases on TikTok with ‘No Buy 25’ challenges.    

So  what should brands consider when working out their pricing strategy with this woman in mind?  

1. Find a way to make discounts personal to your brand. It could be a famous franchise, some specific reward rules, or make it part of your brand ethos (think John Lewis’s  ‘Never Knowingly Undersold’ promise). Just find a way to make it fit your world rather than feel like a generic '30% off’.  

2. Think perk, not promotion as you try to deepen your relationship with her.  

3. Put as much thought into what you discount as she does with the products she buys. She’s  increasingly selective:  what are the products and why is this promotion taking place? Sales need careful curation,  too.  

4. Avoid driving discounts that she might assume are simply to obtain her data. She values her data more. 

5. Help her goals of achieving value while avoiding hyperconsumerism. She doesn’t  want to associate with brands that encourage impulsive spend or are constantly screaming ‘money off’ (unless that’s  what they’re  famous for).  

   
   
   
   

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