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Should I offer discounts for online classes?

7 April 2020

The words ‘online classes’ have been well used buzzwords for a couple of weeks now and at BusyBee, we’ve been busy thinking about how online classes can help keep children's activity businesses running throughout these challenging times. With many businesses now beginning to find their feet in the virtual world and establishing their online lessons, we wanted to take time to focus on whether you should be considering discounts.

Will discounts benefit my business?

Generally speaking - setting COVID-19 aside for one moment - discounts may seem like a good idea in the short term to boost sales but they won’t always benefit your business in the long term. Spending time planning discounts is essential for them to impact your business in a positive way. Whilst discounts may help your club attract people through the door, it’s likely that your expenses will be higher and you’ll be working harder. If you do want your business to provide discounts, try limiting it to one-offs so that it is not something customers will expect every term. As well as this, always ensure the discount amount you settle for has taken into consideration all of your overheads so you are still receiving a fair price for your lessons. In essence, your marketing strategy should not be based on low pricing points or on discount models - instead you should be focusing on what makes your business unique and stand out from the crowd.

Are discounts good when my business faces uncertain times?

Before we get into the nitty gritty, we want you to take a moment and consider whether your business is still providing a service. If you are running online classes, then your answer is yes. You are still working hard to keep your classes going and chances are, you’re working harder than ever! At BusyBee, we are aware businesses are spending a lot of time focusing their efforts on live streaming and pre-recording content which takes a huge amount of time and effort. Ultimately, the point we are trying to make is that you shouldn’t undervalue yourself or your business. With that said, we know many of your businesses will likely have received requests about discounted lessons since the move online or it is something that you are seriously considering without any prompting. The decision on whether or not your business offers discounts will be down to individual choice but we do want to help you tackle this topic at an incredibly difficult time so you can make an informed decision to suit your businesses needs.

Firstly, if you are running your usual class content only online, one of the most important things you can do from the outset is remind your customers that your business is still providing classes, that your class content is still relevant and continues to educate children. Many businesses may have been working towards recitals or competitions prior to this crisis, so remind your customers that your online lessons will still be helping children work towards this. These recitals or competitions which are currently postponed will eventually be rescheduled, so you want to keep the momentum going in classes. It is also important to make it clear in your own mindset that when you return to your physical space, your club will still have progressed and parents shouldn’t want their children to miss out as they won’t be able to return to normal as content will have advanced.

We also understand that while many of you are reading this post, you may find yourself thinking that offering discounts is the lifeline to your business right now. However, we want to share some alternatives with you before you immediately start discounting online lessons - we’ve listed our top 4 alternatives to discounts below you may find helpful:

  1. It’s important to remember that like you, some of your customers may find themselves in difficult situations. Parents may have lost their jobs or have had employment significantly reduced, so it’s especially important to be sensitive throughout this time. If customers approach you about a discount, consider having a one-to-one conversation with them. They may come to you with the reason why they are looking for a discount, so judge it on a case by case basis. For customers who are experiencing financial difficulties, you could consider offering payment plans where customers can pay more at a later date when things return to normal.
  2. As opposed to offering discounts, your club could provide free resources alongside your online classes. When customers are offered something for free, there is something very appealing about what’s on offer. Now we’re not saying a free resource pack will help you avoid discounts completely but they do offer customers something extra which also keeps their children entertained. Your resource packs could be activity based which include quizzes, colouring pages, research questions, a challenge and so on which all relates to your activity type. By putting effort into this, it shows how much you care about your community and that you’re offering more than just online content.
  3. These are unprecedented times and if you are not offering discounts or refunds, then you do need something in place which you can discuss with your customers. As opposed to discounting lessons, your club could offer extra opportunities for children with further lessons next term or additional holiday camps which will run when you're back in your physical space. Why not suggest that payments for online lessons will be carried forward to cover the cost of extra lessons? Whilst you may effectively be offering financial incentives, it will be at a later date where you have managed to see your business through this period and you are feeling a sense of normality in your businesses operations again.
  4. Consider offering a loyalty discount as a one off which could be applied to future sessions when classes return to their routine. A good way of proposing this to your customers is through a loyalty discount with a message of “As a thank you for sticking with us through these difficult times and for your continued support, we are offering our loyal customers a one off x% discount of lessons next term”. Make sure that whatever discount you offer, you have factored in your expenses to ensure that you will still breakeven from your lessons.

The choice of discounting will be entirely down to you and what you feel is best for your members. You may feel discounts are essential and will be the only thing to retain your client base during this crisis but we would remind you to make sure you are offering one which will still allow you to return to your space. Alternatively, you may feel some or all of the above options are worthy of consideration and discussion. Most importantly, we want to remind you how well you are doing at this time and to never undervalue your business and your work.

BusyBee is working hard to find innovative ways for businesses to navigate their way through this challenging time. And as always if you have any questions don't hesitate to reach out to us here