How to use discount to do product operation

Small make up today to discuss with you the discount of activities, small series think this aspect is necessary to say, want to long-term guarantee activities effective, value system is the foundation. Today to expand the value system, specifically the issue of discounts. Today says 3 curves:

Curve 1: Lifecycle and discounts

Q: Why the discount strength will be more and more big?

Just like boiled frog in warm water, users will adjust to a discount, let Hou take this discount as a normal thing.

If you want to be more effective to stimulate the user's nerves will need to use a greater degree of discount (within a certain range, more description see curve 2).

Based on the above 2 points, in the entire product life cycle, activity discounts will be more and more strength, this is a major trend.

Q: Why is the ladder shape?

Most of the things in our lives are depreciating, and if prices fall very frequently, users will not feel secure after buying. If there is no significant depreciation within a cycle, then at least in this cycle users can feel the purchase is guaranteed. The point is how long this cycle should be!

In the case of CPUs, Intel and AMD2 have a fundamental monopoly on the PC CPU market and have full pricing power. Their price cycle is directly related to the release of new products, and the prices of old products will fall once new products are listed.

And as a game, a class of props discount cycle with this type of props play a direct relationship, most props will be in a time period has a great role, after this time, the role will decay. The maximum cycle of this function is the ideal discount period (the ladder width of the above figure)

Curve 2: Activity gains and discounts

My definition of income: direct economic benefits (income), the user's future willingness to pay, the user's confidence in the product, the user's reputation, etc.

Direct economic Benefits (income): Direct manager benefits and discounts have a curve relationship, not the greater the discount, the greater the direct benefit. For example: a prop priced 10 yuan, 10 people to buy, 100, if the price of 8 yuan, there may be 20 people to buy, income 160, if the price of 1 yuan, there may be 80 people buy, the income 80.

Because the user has the limit, so it is not cheaper, the number of buyers will be straight up, there are always 1 valve value (Baidu Encyclopedia explanation) is the highest point, after the will fall back.

The willingness of the user to pay in the future: If an activity is exciting enough for the user, then he will buy a lot of unplanned things, so that when the activity ends there will be a period when the user is not willing to pay unless there is a greater incentive. So there is a "part" of the activity income that is overdrawn in the future at a low price. The willingness to pay for the future is also directly related to confidence in the product.

Confidence in the product: if we live in a society where prices fluctuate greatly. What I bought today, 1 weeks later, became worthless, and some things cost several times. The purchasing power of our money is like riding a roller coaster, then there must be a serious problem in this society. The game is similar, if the price fluctuation is too big, the player will feel fear, dare not pay.

Curve 3: Pay Amount and discount

A small amount of super discount: Free players and small players are price-sensitive users, unlike the old Lady of the market (whether to eat or not to buy it cheaply), only a large role, and the price is enough to stimulate when they will be shot. So for this part of the user, it is necessary to use the most direct stimulation, but must pay attention to, to limit the number of times!

Big discounts: Prices are not necessarily the best way to motivate users who don't blink. They want the glory, the difference ... So this part of the user's discount is not too high, but there must be something to be expected to stimulate them, with priceless things to impress them. This is not a question of discounts, but a matter of added value.

Finally, I used the discount ratio:

The minimum discount for all activities is above 90 percent, if 90 percent is not, it is too stingy.

Product stability period, the proportion of rewards stable around 80 percent

Late in the product, the maximum discount strength will not exceed 50 percent, because I think more than 50 percent will produce some qualitative changes. (for example, group buying subverts the tradition, this subversion is irreversible)

Small series said above discount only for the products I have done in the past, different products will have different value system, in other systems, not necessarily appropriate.