Good news comes out of Houston for the show season ahead. The Houston Boat, Sport and Travel Show at NRG Center ended an eight-day run with an attendance up 2 percent and reports from dealers of very good sales.
You may be thinking that attendance up only 2 percent isn’t that good. However, the show could not open on its first Saturday — normally the biggest attendance day — because the Houston Texans were in an NFL playoff game in NRG Stadium next door. (All parking is contracted to the Texans.) Moreover, the Texans won and played again last Sunday, albeit in on the road. But Texan fans were still glued to the tube, which hurt Sunday’s show attendance.
“When we lose our biggest Saturday and a normally strong last Sunday is down, we’re dealt a tough hand,” said Ken Lovell, executive director of the Boating Trades Association of Metropolitan Houston. “So we are very pleased with our total attendance and, especially, the good sales reports were getting from exhibitors.”
Our winter show season is in full swing. Between now and March, hundreds of dealers across the nation will show off their hottest models in regional and local boat shows. And as they prepare, the inevitable question will arise: Should we have a sign on each boat that shows the dollars off the regular price or the percentage of discount?
You might assume it makes no difference — like which came first, the chicken or the egg? It really doesn’t matter; we eat them both. But studies show what dealers decide about their signs actually can make a difference.
Consumers react differently to discounts depending on whether they’re presented as an amount off or a percentage, according to a study conducted by Eva M. González of Monterrey Institute of Technology and Higher Education. More important for boat dealers, it’s believed to be especially true for more expensive products.
“Even when people understand percentages and dollar amounts,” González wrote, “consumers tend to focus on an absolute number in isolation.”
Similarly, a later study by Blue Hornet Marketing asked 1,000 consumers which they preferred. Result: 42 percent of respondents said dollars off was the most attractive offer, with a percentage discount coming a distant second.
Actually, these findings weren’t all that new. An e-commerce company had gotten a similar result in a coupon study. The “$50 Off” coupon generated 170 percent more revenue than the “15% Off” coupon. So why?
It’s all psychological, or as some behavioral economists have labeled it, the “art of positioning.” It’s creating perceived value, and while the discounts are identical, one feels bigger. So good positioning says all deals aren’t created equal, even if they are. The dollars off savings are right there in black and white — no mental calculations or miscalculations needed — and appear more compelling.
But what about “FREE”? Well, if you really want to turn heads at the show, the word free has power. Forget the dollars versus percentages. The word “free” is considered among the most powerful words in marketing. It stirs excitement like no other, say the experts. “Free” can get people to radically change their choices.
For instance, offering a free electronics package or trailer or dockage or maintenance deal or similar incentives, then strongly noting the value as “you save X dollars” can hit the target. Indeed, every brand in the auto industry today is using such dollars positioning with great success.
So want a word to get prospects into your show display? Free could be that word.
If perception is reality, then take time now, before your local show, to carefully consider what each of your display signs will say. Go with the study results, and show dollars off instead of percentage. And it couldn’t hurt to have a freebie leader prominently somewhere in the display.