2 Ways Your Sales Can Go Bad Quick

Posted In:

blue 3d realistic paper speech bubble isolated on white“Jane” called recently to ask if I could help figure out what happened in her business. She sent over some info and we scheduled a session.

After reviewing everything, I saw what happened and, sadly, what many business owners do when business is slow and they want a cash flow surge or revenue jumpstart.

Jane had offered a 15% discount on her signature program. She regularly enrolls 12-15 people in the program and was thinking the discount would encourage others to register. Her goal was 25 participants and she had plans for that money.

It didn’t happen.

While it doesn’t seem like a big deal, the discount accomplished two things:

  1. For the Program, a 15% discount cut her profit by 50% (read that again!) per member.pricedecreasechart
  2. Which means she now needs 10 members to achieve essentially the same profit as 5 members.


Jane was anticipating 25 people in the program with an estimated profit of $5,000. Instead, 7 clients enrolled and the estimated profit was less than $1,000.

What went wrong?

Two primary things, from which others follow:

  1. Jane failed to calculate what would happen to profits with the discount given the fixed cost nature of her program. She would have been better off keeping the original prices and enrolling the same 7 participants with a more creative marketing campaign.
  2. There was no reason given for the discount. Simply “here’s a discount for you”. Studies show that when we’re given a reason, even if the reason is obvious or nonsensical, we’re more likely to do what’s being asked. See the famous photocopier study.

Later this week, I’ll share what Jane could have done differently for far different, and better, results.

Questions? Just jot them in the comments section below. I’d be happy to answer them.