If you’re running a small business in an area that has a large student population, it might be worth considering offering a student discount. This includes virtually every big city as well as tourist and vacation hot spots. On this article, we’re going to look at the advantages of this possibility, the potential issues and determine whether this option could be the right choice for you. Let’s get started!
What Is A Student Discount?
A student discount is any reduction in price for a product or service that is available to individuals in full-time higher education. Some discounts will also include school students and may even provide benefits for part-time students too.
Types Of Student Discounts
It’s worth noting that student discounts can come in a variety of different forms. It can mean that students don’t have to pay for delivery charges, provide a percentage off all or certain products that you offer and it could be based on certain criteria. For instance, a student might be provided with a percentage off the price they pay if they spend a particular amount through your store.
There are also student discounts that are run by major companies. Some companies provide students with numerous discounts as part of a collective scheme for a group of different brands and businesses. A brand may be provided a chance to opt into this type of scheme and provide benefits for their student shoppers. One of the advantages of this type of option is that it does ensure that the discount is heavily publicised and promoted.
Student discounts can be provided through the use of a card that is sent directly to them. Alternatively, they might be able to gain access to a code that is sent to their student email or perhaps delivered to their address.
Students can also access discounts that either operates online or instore. If they are using an online discount system, they may need to provide their student email to access it. Alternatively, if the discount is provided in-store, then a student may be required to show a valid student ID for the particular year.
Discounts can also be offered through a set period and may be seasonal. If the discount is seasonal it could run during the weeks leading up to the student’s return to college, through the summer season or potentially during the college semester. It’s not uncommon for businesses to have different student discounts running throughout the year. These can change according to the needs of the student, the products available and the requirements of the business.
Discounts can also be provided through special deals including ‘buy one get one free.’
Advantages Of The Student Discount
There are numerous advantages to offering student discounts for small businesses. First, it does increase the brand awareness of the company. When you provide a student discount, this is something that could pick up buzz across social media or potentially gain traction through a student population. A discount will also be seen as evidence that a brand is providing more value to a customer base. As such, it could trigger a higher level of brand loyalty.
By offering a discount, you are encouraging customers to favour your brand over the potential competition on the market. It can give you the upper hand and provide you with the crucial repeat sale, ensuring that customers keep returning to your business.
One factor to be aware of is that if a student likes a product, they will on average tell 20 people, compared to an adult who may just tell 2 or 3. Students are also far more likely to use social media and share content with friends, family members and the full extent of their followers. The average member of Generation Z will spend 11 hours on social media every day. Many also use large following platforms like Instagram as well as Snapchat.
If your business is in a location that has a high student population, you could also see an increased demand for your business and the products that you sell.
Students are the big earners of tomorrow. These are the future CEOs, executives and managers. If you want to get them on your side early, you need to provide them with a reason to favour your brand. A student discount can be a great start and students are making purchase experiences right now that are going to impact their brand loyalty for the next decade.
Indeed, 85% of students said that the experience they gain with a brand when in college will impact what they purchase and where they purchase from in the future. Another 83% suggested that a discount makes it more likely for them to shop at a store.
Do Students Have Less Money?
This is a common misconception but it holds no real weight. On the contrary, Students earn on average over a thousand each month. They also don’t have as many financial commitments and this frees up their disposable income allowing them to make more purchases. Remember, they don’t typically have kids or a mortgage to contend with.
Disadvantages Of The Student Discount
There are a few issues with the student discount. It’s possible that you will see a reduced profit margin. This is why it’s important to carefully select the right level of discount. It needs to provide value to the customer without negatively impacting your bottom line. Tech discounts are typically anywhere between 10 and 30% but won’t run continuously. Fashion will often reach 20% with the same for beauty products.
It can also be difficult to regulate the system and ensure it’s not abused. A lot of students will share their discount with friends and family members leading to something often referred to as ‘discount leakage.’ As such, it does require a comprehensive and foolproof verification system to ensure that this is not an issue.
Alternatively, it is possible that discounts for students will lead to disgruntled shoppers in other demographics. If they are loyal to your business and are gaining a worse deal compared to new students who may be shopping from your company for the first time, it could hurt your reputation. As such, you may want to consider having a loyalty scheme so your most valued shoppers can gain discounts as well.
Does it become a race to the bottom? As with any USP that is reflected in the price, there is the risk that companies begin to compete to offer the biggest discount possible for students to win their business. This can lead to an ugly situation and one that doesn’t benefit any of the companies involved.
Another potential disadvantage is that you are going to need to make sure that you promote the discount. While students will likely talk up your discount once they discover it, you have to work to ensure that a significant amount knows it exists. There are numerous ways that you can do this. You can add a badge to your site, highlighting that you offer discounts. You can mention it in the FAQs, set up your search to send users to the discount when they search for ‘student’ or email the student database. You may also think about adding a link or promotion banner onto your homepage and you can set up landing pages.
Brick and mortar companies can print off flyers, hand out leaflets and use in-store promotional materials such as window stickers. This will depend on your specific store.
So, why is this a disadvantage? Well, this type of promotion will always cost time and money. As such, you will need to determine what type of promotion will fit into your business budget and whether it will have an impact. Again, this is a balancing act of making sure that you don’t overspend while also providing enough of a promotional push to guarantee that students are aware of the discount.
So, is a student discount going to be the right choice for you? Well, ultimately, this is going to depend on the type of business that you run. Specifically, you need to think about how many of your customers are actually students. It’s possible to explore this by running surveys and analysing customer data.
According to research, students will spend a significant amount of money each month on fashionable items and socialisation. However, this certainly won’t be the only types of services and products that interest this demographic. Students are buying tech too, they’re investing in products for their dorm rooms and they are looking for services that can make their life easier. There’s a reason why Amazon offers student discounts on Prime every year.
Once you discover your student audience you then need to think about the type of discounts that appeal to them. According to surveys, the most popular type of student discount is money off and they prefer this in the form of a percentage instead of a set amount. Buy one get one free deals are also highly popular particularly for food products like pizza and take away companies. As well as this, you can think about offering a free gift for signing up. This is another way a brand can show dedication to providing value.
If you decided you want to offer a student discount why not advertise your offer on the WHOC platform for free to increase your exposure in the student market.