Question

1.) Comment on the effectiveness of using deep discounting to attract new customers. What are the pros and cons, both in the short-term and long-term?

2.)Once the initial deep discounts have ended, how can Jet.com use other elements in its marketing program to attract and keep customers? Explain

Answer 1

1. Deep discounting means to give extra discount than usually it is provided. Jet.com adopted this strategy to attract new customers. Jet.com provides deep discounting to the customers, by this strategy new customers are attracted to take service from Jet.com because they get a good service at lower charges compared to other service providers. So this is very effective method to attract new customers. Pros of deep discounting in short term and long term is that by adopting this strategy Jet.com can raise more cash in a short time and attract new customers easily and cons of this strategy in short term and long term is that by adopting this strategy salaries to staff will be reduced because of less collection of cash from customers due to deep discounting. By this new customers can doubt that Jet.com will provide same quality of service to the customers at deep discounting or not because they can provide poor quality of service at less cost.

2. Once the initial deep discounts have ended then Jet.com will adopt other marketing strategies to attract new customers. First is Jet.com can reduce salaries to staff and use the money in marketing of Jet.com. Other is to cut expenses they can use that money to provide more facilities to the customers. They also can improve their services to attract new customers. They can give some extra facilities to the customers like insurance, service on time with reasonable price. They can also join hands with online sites to promote their business at a reasonable charge and spread their business worldwide.