Supermarkets do it all the time. They will advertise a sale price for an item on which they will lose money; that is, not only will they not make a profit at that price, the cost of sales for that one item actually exceeds the selling price. This strategy is known as a “Loss Leader” strategy, and it’s not just for supermarkets.
Loss Leader isn’t a strategy for going out of business, rather, if executed properly, it can lead to more customers, more sales and higher profits. The “loss” part is simple – the product or service is sold at a monetary loss. The “leader” part is that the product or service is offered as an incentive to attract new customers and hopefully introduce them to other profitable products or services that you offer. What if you only offer one service such as window washing?
Even with only one product or service, you can both minimize the loss and maximize the lead by offering the discounted price for a limited time or scope – for example, 3 days only, or for the first 20 respondents. That sense of urgency can motivate procrastinators to move quickly. Make a great impression on the folks taking advantage of the loss leader and they’ll be back or even refer you to their friends.