Business

Loss Leader strategy- businesses thought to use in increasing numbers

Published

5 years ago

September 30, 2020

When people talk about pricing strategies, one of the most mentioned is the ‘loss leader strategy.’ This involves pricing a product low enough to get customers through the door. Once there, the customers will likely spend more on higher ticket items. Essentially, the business sacrifices the loss leader to encourage customers to shop with them. But how effective is the strategy?

Loss Leader to Develop Loyal Customers

The loss leader strategy can be used to develop loyal customers to incentivize them to use a certain brand. Nightclubs and bars that offer happy hours do so as a loss leader strategy, with very little profit being made on each item. Instead, the customer becomes a loyal patron and may visit at other times.

They may also stay beyond the happy hour or spend enough due to the cheap prices to make up for the loss leader of the original happy hour offering. The goodwill gesture that can be seen in the reduced prices will be more likely to foster positive attitudes towards a brand or business, which will then cultivate a stronger relationship.

Loss Leader to Incentivize Against Competitors

Moreover, the online entertainment industry utilizes the strategy to get customers to try the product or service instead of those of a competitor. Customers can then indulge in more of what the entertainment site has to offer. As we can see, some new casinos in the USA offer no deposit bonuses as a loss leader to attract new customers. These range from no deposits to free spins and can be tailored to specific games. This means that they offer an incentive for customers to use them, and once on the site, the customer can engage with the online casino games they have on offer. The welcome bonus gives them a foot in the door to then try out the other aspects the site has to offer.

Loss Leader to Sell Higher Ticket Items

One of the main reasons for using the strategy in retail is to get customers through the door so they then purchase other higher priced items. Milk is a common loss leader product as most retailers make little on the milk – but without it, many customers wouldn’t step foot in the store and would go elsewhere.

Losing money on these items is necessary for a business who might be charging more for other higher priced items. By giving away something like milk for a low price the retailer can focus on upselling other products. If someone is coming to a store for one item, they are likely to go somewhere it is cheapest. As most people attest to, one item rarely means one time.

The loss leader strategy can be useful for a business. As part of a wider strategy, it can help incentivize customers to use the brand or business, can help foster stronger relationships with customers, or could be used as a ploy to sell more expensive items. Ultimately businesses who use this strategy understand that by sacrificing something to get the customer’s attention, they could end up with far more profit than if they had relied on the customer arriving without any incentive.

Business

Spynn’s PR Playbook for Startups Turning Funding into Market Leadership

Published

3 weeks ago

March 27, 2025

Matthew Wiles

Byline: Jennyfer Ann Valencia

The recent funding boom in India, where startups raised over $428 million between March 10 and March 15, 2025, reinforces the critical role of public relations (PR) in securing investor confidence and enhancing visibility. As competition intensifies, effective PR strategies help startups differentiate themselves and build a strong market presence.

Spynn, a PR agency for startups specializing in securing top-tier media coverage, enables startups to craft compelling narratives that attract investors and maintain a positive brand image.

The Role of PR in Startup Funding

A recent survey conducted by Spynn found that startups with a strong PR strategy are significantly more likely to secure funding rounds than those without. According to the research, nearly 70% of investors say media visibility and brand credibility helped their decision-making process. This highlights PR’s direct impact on a startup’s ability to attract investment.

PR helps startups articulate their value to investors by securing media coverage and highlighting their growth potential. High-profile placements lend credibility and set up startups’ potential, making them more attractive to investors. For instance, a well-publicized success story from a startup like Zolve, one of the top funding recipients, can drive further investor interest and strengthen its brand.

India’s funding surge spans sectors including Batterytech, Edtech, Gaming, Apparel, Aerospace, Manufacturing, Fintech, Energy, and Travel. While this presents opportunities, it also brings scrutiny. Startups must manage their reputations effectively, ensuring consistency in their messaging across media platforms. As a PR agency for startups, Spynn’s expertise in reputation management helps businesses navigate these challenges by maintaining a cohesive brand identity and reinforcing investor trust.

Establishing Credibility Through Media Placements

Research from Spynn also revealed that startups that get featured on Forbes, Business Insider, and other top-tier publications experience a 50% increase in inbound investor inquiries within six months. This shows the value of securing strategic media placements to reinforce credibility and market positioning.

Strong media coverage bolsters a startup’s credibility, reinforcing its market positioning and investor confidence. Spynn ensures startups secure coverage in authoritative outlets, helping them establish themselves as thought leaders. Beyond initial publicity, Spynn focuses on building long-term relationships with media, ensuring sustained visibility and brand consistency.

Spynn’s CEO, Matteo Ferretti, emphasizes the role of storytelling, “Effective PR is about coverage and creating narratives that resonate with audiences. Startups must highlight their unique value and demonstrate how they solve real-world problems.”

PR for Growth and Global Expansion

Spynn’s data indicates that startups leveraging international PR strategies are twice as likely to successfully attract foreign investors and expand into new markets. Media coverage tailored for global audiences enhances cross-border recognition and facilitates partnerships, making PR an essential tool for growth beyond domestic markets.

As Indian startups scale, a strong PR strategy facilitates global recognition. Spynn’s international media reach helps startups gain traction in new markets and attract foreign investors. This is especially crucial for sectors like Fintech and Edtech, where global expansion is key to success.

A well-executed PR strategy strengthens a startup’s digital footprint, ensuring a consistent and engaging presence across platforms. Matteo Ferretti highlights the importance of balance, “A successful PR approach integrates both digital and traditional media to maximize impact and audience engagement.“

Ethical Considerations and Future Trends

Transparency and ethical storytelling are vital in PR. Startups must ensure authenticity in their messaging to build lasting trust. Spynn upholds ethical PR practices that align with principles of sustainability and integrity.

Indian startups must adapt to evolving PR trends, including AI-driven outreach, digital media dominance, and deeper media relationships. As competition grows, startups that take advantage of PR will have a better standing for long-term success.

Spynn’s PR strategies equip Indian startups with the tools to navigate funding surges, enhance credibility, and drive growth. By securing impactful media coverage and managing reputation effectively, startups can strengthen investor confidence and expand their market presence. As India’s startup ecosystem evolves, PR remains an indispensable asset for sustained success.