The Real Game of Discounting: How Smart Coaches Accelerate Profits

If you’ve been in the trenches as a business coach, you’ve heard it a thousand times: “Should I offer a discount to get more customers through the door?”

Maybe your clients swear by “10% off” or “Buy One Get One Free!” as their ticket to more business.

But let’s cut to the heart of the matter: blind discounting is lazy, dangerous, and can sink profits faster than a stone in water.

In this post, we’re going deep on the real economics of discounting, exposing both the landmines and the opportunities.

You’ll leave with a strategy you can use to transform any business from “struggling for scraps” to “profitable juggernaut,” with stories, action steps, and no sugar-coating.

Ready? Let’s play chess, not checkers.

The Discounting Trap

Let’s deal with the elephant in the room: most business owners have no idea what a discount actually costs them. Here’s the punchline I shared on the podcast:

“If your client offers a 10% discount, they have to sell 33% more to break even.”

Let that sink in. Give away 10%, and you’re suddenly running a marathon just to stay in place, needing a whopping 33% more sales just to keep your nose above water.

Most businesses and coaches miss this. They think “busyness” equals business, but if you’re filling your time with discounted deals, you’re just getting busy going broke. Do the math before you slap a red tag on your offer.

Chess Not Checkers

Want to see how the big players use “discounts” as deadly weapons? Enter Gary Vaynerchuk at his family’s liquor store. He didn’t do “store-wide 10% off” nonsense; he played chess:

• Advertise below cost on the hottest sellers (think Budweiser, Coors Light).
• Draw in crowds chasing the “deal.”
• Deploy storytelling and killer salesmanship once the bargain hunters walk in the door.
• Upsell boutique, high-margin products (craft beers, unique wines) that few competitors offer.

Result? The store might lose a buck on a Budweiser, but made five on the craft brew and red wine… and created rabid fans who kept coming back for the special stuff.

That’s how you go from a $3 million shop to $60 million. You’re playing long-term profit, not quick-fix busywork.

The Smart Discounting Strategy 

Here’s your reality: if you want to advise clients on pricing, you can’t settle for “just lower your price.” Instead, help them answer:

• What can we offer below cost that draws ideal prospects?
• What’s our high-margin product we can tell a story about and upsell in-person or online?
• How do we reward repeat buyers and referrals, without devaluing our brand?

A buy one, get one free will always outperform “50% off.” Why? Psychology and perceived value. Wrap things in a story. Make the offer memorable. Make your clients think about lifetime value, not “today’s receipts.”

Why Most Discounting Fails

Here’s what tanks most small business discounting:

• No upsell strategy: You give away the farm, but customers grab the deal and run.
• Commoditized market: If you only compete on price, you’re in a race to the bottom. Someone bigger will always undercut you.
• Misjudging margin: That 10% “sale” is a 33% mountain to climb. At 25%, the hill is Everest.

Your job as a coach? Teach your clients that the real game is margin, loyalty, and unique positioning. Show them how “discounts” are marketing investments, not acts of desperation.

How to Turn Discounting Into a Profit Accelerator

Ready to get tactical? Here’s how you can wield “discounts” like a ninja:

1. Choose the Right Loss Leaders

Pick a popular, super-visible item to discount heavily. It should be:

• Craved by your target customers
• Not available everywhere
• Easy to switch to a premium alternative

2. Master the Upsell Script

Train staff (or your client, if it’s a solo operation) to guide every customer from the loss leader to a story-laden, high-margin offer. Make it effortless, not scuzzy.

3. Track, Test, and Refine

Measure how often customers only buy the discount versus those who upgrade. Refine the offer, script, and product mix. Scrutinize the numbers; the first rule is profit comes first.

4. Build Loyalty and Word-of-Mouth

Craft brews, limited releases, members-only add-ons, these keep people coming back and raving to their friends. That’s chess.

5. NEVER Discount Without a Purpose

Every “deal” should have a specific goal: new traffic, trial of a new product, capturing a new email, or boosting slow days. If your client can’t tie it directly to a planned next step, don’t do it.

Stop Racing to the Bottom

Discounting is a tool. Used without a strategy, it’s a sledgehammer smashing profits. Used smartly, it’s the secret door to loyalty, upsells, word-of-mouth, and sustained growth.

As a business coach, your job is to install strategies that create profit, compounded, repeatable, and long-lasting. That’s why I created a business operating system that plugs into ANY small business and finds hidden profits, all without pouring more cash into marketing.

Ready to see it in action? Book a call and let’s find the profits already hiding in your clients’ businesses.