The Customer Who Learned to Wait

The offer ends tonight. The next one begins on Thursday. Somewhere between the two, a customer learns something the business did not intend to teach: there is very little reason to buy on Wednesday.

Repeated promotions are usually discussed as a margin problem. They are also a lesson. Every price change gives customers another piece of evidence about what buying now means. A business may believe it is creating urgency while its recent behaviour makes patience look like the more sensible choice.

A successful weekend can conceal an expensive month

Imagine a small retailer introducing a weekend discount to bring forward some purchases. This is a hypothetical example, not a reported case. Orders rise. The owner repeats the offer the following month, then adds a midweek code when sales slow. Eventually customers begin asking when the next promotion will start.

Those questions can feel like evidence that customers have become unreasonable. They may instead be evidence that customers have paid attention. If the same product repeatedly becomes cheaper shortly after someone buys it, waiting is not necessarily indecision. It can be a rational response to the pattern the business has established.

The weekend report cannot settle whether the promotion helped. Some customers may genuinely be new. Others may have bought sooner than planned, bought more than needed or paid less for something they would have purchased anyway. A busy period is an observation. Incremental demand is a different claim, requiring a comparison that the sales chart alone does not provide.

The price on the page is not the only price in the room

A controlled experiment by Manohar Kalwani and Chi Kin Yim, published in the Journal of Marketing Research in 1992, found that promotion frequency and discount depth influenced the prices participants expected to pay. The abstract supports a narrow but useful point: expectations can be shaped by the pattern of offers. It does not establish what a particular modern shop should charge or how often it should promote.

The practical inference is that customers can arrive with a remembered price as well as the advertised one. A full-price week may therefore feel different after several discounted weeks. The business calls it a return to normal. A customer who has mostly encountered the lower price may experience it as an increase.

That does not mean every customer remembers every offer. Some need the product immediately; some discover the business for the first time; some value availability more than savings. The question is not whether everyone waits. It is whether the firm is making waiting attractive to enough customers to change the economics of its promotion calendar.

Give the reduction a job

There are legitimate reasons to discount. A retailer may need to clear a discontinued line, a service business may want to fill otherwise unused capacity, or an introductory offer may reduce the cost of trying an unfamiliar supplier. Those objectives should not be treated as interchangeable simply because each produces a lower number at checkout.

Name the job before choosing the offer. If the aim is clearing particular stock, evaluate what remains and what the clearance contributes after relevant costs. If the aim is acquiring customers, look beyond the first discounted order. If the aim is filling quiet appointments, check whether bookings moved from slots that would otherwise have sold at the usual price.

An offer with a specific purpose can also have an understandable boundary. Different conditions, a genuinely different package or a particular available slot can explain why a lower price exists. The boundary must be real and clear. Inventing a distinction to conceal an effectively permanent reduction does not solve the underlying problem of expectations.

Count what the offer moves, as well as what it adds

For the hypothetical retailer, a useful review includes the periods before and after the promotion. Did the discounted weekend merely collect purchases absent from the preceding week? Did the next week weaken? Did the mix shift towards products with lower contribution, or did fulfilment costs increase? Revenue alone cannot answer these questions.

Choose an observation period that fits the buying cycle. A few days may be informative for some purchases and misleading for others. Where feasible, compare a suitable group or period without the intervention, while acknowledging differences in traffic, season, stock and other marketing. An imperfect comparison should remain an imperfect comparison, not acquire certainty because a spreadsheet has decimal places.

The review need not become a research department. It needs a stated objective, a defensible comparison and an honest account of uncertainty. Record the result that would justify repeating the offer and the result that would prompt a change. Otherwise a promotion can earn another promotion simply by creating the quiet period that follows it.

Predictability is not the enemy

A regular, transparent offer can be perfectly coherent. Customers may appreciate knowing when a service is cheaper, and the business may deliberately exchange price for flexibility. A stable arrangement can help both parties plan. The problem is not that the customer understands the schedule. It is that the business has mistaken an understood schedule for a fresh surprise every time.

Nor is constant price variation automatically more sophisticated. Unpredictability can make decisions harder and communication less credible. Making customers uncertain about whether they are being treated fairly is not the same as giving them a useful reason to act. A business should be able to explain its pricing structure without needing customers to misunderstand it.

A quantity price is also different from an endlessly renewed countdown. So is a clearly specified off-peak service. Evaluate the actual offer and conditions rather than condemning every reduction under one label. The aim is a pricing pattern that supports the business and makes sense to the customer, not a ceremonial commitment never to discount.

Changing the lesson takes more than deleting a banner

If a firm decides it has taught customers to wait, ending a promotion will not necessarily erase that expectation immediately. Some people may continue waiting for the familiar message. Others may leave. A brief fall in orders does not by itself prove that the previous policy was better, but neither should it be dismissed as a temporary inconvenience without evidence.

Change a bounded part of the approach and observe it over a relevant period. Explain the actual current offer clearly, honour commitments already made and make sure staff can answer price questions consistently. Do not promise that a price will never change if the business cannot sustain that promise. A new policy should be a workable operating choice, not another dramatic headline.

The work may reveal that the usual price itself needs reconsideration. It may reveal that the promotion is doing a valuable job. Either finding is more useful than defending a nominal price that hardly anyone pays. The point of the exercise is to understand the commercial arrangement customers are actually using.

The next offer teaches something too

A promotion asks for an order today and sets an expectation for tomorrow. Good measurement pays attention to both. The customer who waits is not always lost, disloyal or difficult. Sometimes the customer has simply become very good at reading the business.

Before launching another countdown, ask what a sensible repeat customer would learn from the last few months. If the answer is “never buy before the next code”, the company may already have a pricing policy. It just has not written that policy down.

Source: publisher abstract consulted; the full paper was not available in the retrieved source. Kalwani & Yim (1992).