Thursday, July 05, 2007

Threshers' incredible disappearing discount

Now this is the kind of thing that brings marketing a bad name.

At Christmas Threshers started a viral campaign that offered a discount voucher worth 40%. It seemed a great deal, until it was pointed out that they ALWAYS offer a "3 for 2" deal which equates to 33% discount anyway. Of course, many of those receiving the vouchers were not regular customers and therefore were probably unaware of this.

The reaction was mixed. Some saw this as a "rip off", others as a genuine additional discount even if not nearly as substantial as at first glance. Either way, it seemed to work.

My own view at the time was that this was still a good deal as it represented the equivalent of a further 10% discount on the "normal" price*.

As of today, Threshers are offering 35% off 6 or more bottles until 22 July. "Get the Barbie out of the shed" they say. Hurrah!? That lot at Tesco are only offering 30%.

But, hold on a minute. This is apparently also instead of the usual "3 for 2" offer. Therefore, the additional money you save for buying 3 more bottles is ... 2.5%. We all like deals, but this one is rather small.

This time I can't help the feeling that the only justification for such an "offer" is to dupe customers into thinking they are getting a better discount without actually offering one. They are not actually ripping anyone off of course, they are offering something of genuinely greater value to the customer, but in this case it is very small.

For example, if you pick up 6 bottles of a wine worth £5, the additional saving is worth 50p. Hardly the kind of thing worth creating a poster campaign about or updating the tills for is it?

Whilst I applaud their "3 for 2" campaign to encourage high street shoppers to buy in slightly greater volume, I suspect that the outcome of this campaign could be to damage the reputation of Threshers as offering a good deal, and once again equate "marketing" with "rip off".

Or have I missed something here?

Of course the reason they are doing it is that consumers are so addicted to "deals" that they are now probably losing out heavily to Tesco and others who are currently offering large discounts of their own. Selling wine on the high street in competition to supermarkets is a tough business. I wonder how long Thresher will be able to try and play the same discounting game, or whether it is time for some more of that creative thinking that created the "3 for 2" in the first place.







* the "normal" price is 66% of the single bottle price, so the 'extra' discount is calculated as a % after the initial discount, therefore:
(.4-.3333)/.6666 = 0.1 or 10%

2 comments:

Peter May - The Pinotage Club said...

I applaud their "3 for 2" campaign to encourage high street shoppers to buy in slightly greater volume,

So you don't agree with recent claims that such offers encourage binge drinking?

I suspect that the outcome of this campaign could be to damage the reputation of Threshers as offering a good deal, and once again equate "marketing" with "rip off".

Or have I missed something here?


Yes, I think you have. I think you overestimate the publics mathematical ability. Comparing percentages is complicated. For instance you show that chnaging from a 33.3% to 40% discount (6.7 percentage points) gives an additional 10% discount, but that halving that extra discount - 33.3% to 35% doesn't give an extra 5% discount.

The real problem with Threshers is that the sing;e bottle price is so inflated. With Tesco, their instore prices are equivalent to the discounted Threshers price, and so an additional 30% is a deep discount.

Problem I have with 3for2 and Oddbins 20% off 6 bottles is that when I'm tempted by an interesting bottle I don't want to buy 6 bottles and won't pay the inflated price of the single bottle.

Robert McIntosh said...

thanks again for the questions. Once again the response needs more space than a reply box, so I have posted a separate post. Thanks for keeping me on my toes!