As the holiday approaches, shopping enthusiasm among Indonesians reaches its peak. This phenomenon presents a golden opportunity for business owners to boost their revenue through various Eid promotions.
However, behind the sharp increase in sales lies a risk that often goes unnoticed: profit margins being eroded due to reckless discount strategies. Many business owners get caught in price wars or offer steep discounts simply to follow competitors’ trends, without accounting for the increased operational costs during the holiday season.
To keep your business financially healthy while celebrating a sales surge, the right strategy is essential. This article will discuss how you can stay competitive with attractive Eid promotions without sacrificing profitability. Let’s dive in!
Tips for Managing Eid Discounts Without Eroding Profit
Offering price cuts is indeed the fastest way to attract customers, but discounts are not the only element of a promotion strategy. The key to a successful promotion is creating perceived added value for consumers without inflating your expenses.
Here are strategic steps you can take to maximize profits amid the flood of Eid promotions:
1. Implement a Product Bundling System
Instead of offering a direct discount on a single low-margin item, try using a bundling technique. Combine your best-selling products with slower-moving items into a single Eid package.
This approach not only increases the average order value but also helps reduce warehouse inventory. Moreover, it allows you to maintain overall profit margins.
2. Use Tiered Discounts
This strategy encourages customers to spend more in order to receive larger discounts. For example, “Get Rp10,000 off for a minimum purchase of Rp100,000, and Rp30,000 off for purchases of Rp250,000.”
By setting a minimum purchase threshold, you ensure that the cost of the discount is covered by higher sales volume. This way, profit per transaction remains protected.
3. Limit the Duration and Quota of Promotions
The psychology of scarcity is very effective during the Eid season. Instead of offering discounts all month, create “Flash Sale” promotions at specific times or for a limited number of units.
This creates a sense of urgency for buyers to make a purchase without having to offer discounts to everyone. By limiting the quota, you can precisely control how much margin you’re willing to “give up” to attract traffic.
4. Focus on Non-Cash Rewards
Sometimes, offering physical gifts is more advantageous than cutting prices. For example, with a minimum purchase, customers could receive a “Limited Edition Eid Pouch” or an “Exclusive Greeting Card.”
Psychologically, consumers feel they’re getting extra value. For you as a business owner, however, the cost of providing these gifts is often lower than giving a 20–30% discount on the product itself.
5. Leverage Loyalty Programs for Existing Customers
Eid promotions don’t always have to target new customers. Offering special discounts or “Early Access” to loyal customers already in your database is a cost-effective strategy.
The cost of acquiring new customers is usually much higher than retaining existing ones. By focusing on loyalty, you can offer more personalized promotions with higher conversion rates.
6. Calculate a Safety Margin Before Launching Promotions
Before deciding on the discount amount, calculate the Break Even Point (BEP) after the discount. Ensure that the selling price after the reduction still covers the Cost of Goods Sold (COGS) and operational expenses, such as extra packaging or employee overtime during Eid.
If a 50% discount causes losses, consider switching to another promotion, such as “Buy 2, Get 1 Free.” From a calculation standpoint, this type of promotion is safer for protecting profit margins.
The Importance of Early Preparation for Eid Promotions
The Eid season is a period when cash flow moves rapidly in and out. Without careful planning, you might feel like the cash drawer is full, but by the end of the month, net profits could be virtually zero.
That’s why technical preparations—such as stock management, staff readiness, and transaction recording systems—must be in place before the surge in demand occurs.
Additionally, transparency in tracking the effectiveness of each promotion is key. You need to know which promotions truly generate profit and which simply “burn money.” Without accurate data, you’ll just repeat the same mistakes in the next promotion season.
Manage Your Eid Promotion Campaigns More Easily with Labamu
A great Eid promotion strategy requires precise and measured execution. Recording discounts manually or using a regular calculator during busy store hours risks costly calculation errors.
That’s why the Labamu cashier app exists as a digital solution for MSMEs. Labamu now comes with a Campaign Management feature, specifically designed to help you manage various promotions automatically and professionally. With the Campaign Management feature, you can:
- Set up automatic discounts: No more manual calculations at the cashier— the system will apply price reductions according to the promotion scheme you create.
- Monitor promotion performance: Track in real time how many products are sold through each promotion and observe its impact on profit margins.
- Personalize promotions: Create unique campaigns for different customer segments to target them more effectively.
- Save time: Manage all discount programs from a single, easy-to-use dashboard, allowing you to focus more on serving customers.
Don’t let this year’s Eid promotions pass by without maximizing results. With the right strategy and the technological support from Labamu, you can boost revenue while keeping profits secure. Ready to maximize your earnings this Eid season?
Let’s get started with Labamu!
