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Discount containment

Definition updated on November 2023

What does discount containment entail in pricing strategy and sales promotions?

Discount containment refers to the strategy of carefully managing and limiting the discounts offered on sneakers in order to preserve the perceived value of the inventory and maintain profitability. This involves setting clear guidelines and limits on the level of discount that can be offered, the duration of the discount, and the conditions under which the discount is available. For example, a seller may decide to offer a 10% discount on all sneakers for a limited time, but no more than 20% off on any single pair of sneakers. This helps to attract buyers and increase sales, while still maintaining a reasonable profit margin and preserving the perceived value of the inventory. In the sneaker resell market, it is common for sellers to offer discounts as a way to attract buyers and compete with other sellers. However, offering excessive discounts can lead to a devaluation of the inventory, lower profit margins, and can also attract buyers who are only interested in low prices, rather than the quality or uniqueness of the sneakers. For beginners in the sneaker resell market, it is important to carefully consider the level of discount offered, and to have a clear discount containment strategy in place. This involves setting clear guidelines on the level of discount that can be offered, monitoring the impact of the discounts on sales and profitability, and adjusting the strategy as needed.

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