ASH AMBIRGE

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Percentage Off or Flat Rate? How to Run a Sale That SELLS.

In: Money Talk

I hate rules.

No swimming after eating.

Let him call you.

Sorry, our video library can only be watched from within The United States. (Stab. Stab. Stab.)

No white after Labor Day.

And other silly rules like stay on your side of the road.

…I kid, I kid.

That last one can slide–as long as we're not head to head, rounding a curve at the Indy 500.

But there is one rule, however, that I think is pretty nifty.

It's called The 100 Rule. 

And if you're running a business and intend on running a sale? You should know it.

The 100 rule is this:

  • If what you're selling costs less than $100, offer a percentage off.
  • If what you're selling costs more than $100, offer a flat amount off.

Why?

Because the way you frame it affects how generous the sale appears–even though it's the exact same, expressed two different ways–and in turn, affects how successful your sale is.

:: Take that $25 homemade candle you're selling. Which seems like more of a deal: 20% off, or $5 bucks? The percentage, of course.

:: Now take that $2,000 service you're offering. Now which now seems like more of a deal? 20% off, or $400? You guessed it–four hundred whoppers.

It's all about the art of positioning.

Because psychology plays a fundamental role in whether you make sales…or not.

It also, apparently, plays a role in securing second dates, so I guess we should all pay attention.

After all, you never know when you're going to have to whip out this theory when the check comes.

How can we frame this tip to appear even more generous?

Oh, I know, The 100 Rule.

Your date won't think you're weird at all.

Don't worry.

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