Offering a discount when paying in Bitcoin \ stacker news ~bitcoin

Offering a discount when paying in Bitcoin

1309 sats \ 33 comments \ @kytt 5 Mar bitcoin

I've been thinking more about discounts that are offered to customers paying in Bitcoin. I've noticed that most of the discounts I've seen in the past are usually 10% or less. I realized, if this were me, on most occasions I wouldn't bat an eye for that kind of a discount.

My proposal: if you are a business offering a discount for paying in Bitcoin, and it is feasible for you, consider making the discount much larger - maybe somewhere in the 25-50% range. Before I got into Bitcoin, I believe this would 1) make me much more likely to find a way to pay you in Bitcoin and 2) make me curious as to why someone would offer such a large discount for paying in Bitcoin.

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620 sats \ 2 replies \ @DarthCoin 5 Mar

I did that long time ago, around 2016-2017. I offered a 10% discount to all my clients if they pay my invoices in BTC directly. The next tier was standard price if they pay in cash. The lowest tier was: if they pay through bank transfer, will get a raise of 10% on top of the price.

Some clients were surprised about that, some were interested into Bitcoin. Nowadays after years, those that were listening my advice to start accumulating BTC and pay me in BTC, are very grateful to me and always remember that I saved them.

I also did this https://darthcoin.substack.com/p/a-bitcoin-adoption-story

22 sats \ 0 replies \ @oliverweiss 5 Mar

That is a nice story about the owner of the grocery store.

0 sats \ 0 replies \ @satoshiplanet 5 Mar

https://media.tenor.com/r40EvzgO5a4AAAAM/bitcoin-king.gif

336 sats \ 10 replies \ @kr 5 Mar

or try the opposite approach, add a 10% fee for paying in fiat.

on average, people have a stronger aversion to losing than they have an attraction to winning.

69 sats \ 0 replies \ @030a29f333 5 Mar

BTC Sessions talked about this being the way recently. 20% fee for fiat was apparently the tipping point for the majority of people to start paying in sats

69 sats \ 0 replies \ @Fabs 5 Mar

this is the way.

69 sats \ 1 reply \ @kytt OP 5 Mar

Also a fair point, but still, make the fee larger ;)

0 sats \ 0 replies \ @Fabs 5 Mar

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0 sats \ 4 replies \ @joda 5 Mar

That's how you lose customers and get bad reviews

33 sats \ 3 replies \ @kr 5 Mar

why?

it actually costs more money for merchants to accept fiat payments vs. lightning payments… it’s totally reasonable to charge an extra fee imo.

0 sats \ 2 replies \ @joda 5 Mar

Because people like discounts, and dislike fees. If you give a bid or advertise rates, then when you bill them charge a fee or surcharge, I think a lot of people will resent it and accuse you of nickel and dime.

Plus it's all in the name of your pet cause that most people don't care about.

How would you take it if a business charged you a fee unless you paid in Doge?

26 sats \ 1 reply \ @kr 5 Mar

i don’t think people actually like discounts that much (when they come with hoops one needs to jump through).

for example “save 5% if you sign up for our rewards program” has a negative effect on me. i’d pay an extra 5% if they promised not to bombard me with random offers upon checkout.

69 sats \ 0 replies \ @joda 6 Mar

True!

Depends somewhat on the product or service and absolute amounts. Like 10 percent off a $10,000 project is a lot. But yeah 10 percent off some $20 at a random store who cares

0 sats \ 0 replies \ @0xbitcoiner 5 Mar

😂

https://imgprxy.stacker.news/0cZKWH8_EGvFWWjhRAZDtE9NaHJi-pHZHoxMCanWYFU/rs:fit:1280:720/aHR0cHM6Ly9pbWFnZS5ub3N0ci5idWlsZC85YmRmNDBiZTk4NWUzNzJiNDJiZTYxMzlkYWJlYjZkMzNmNjZiM2NmMTY2MTA2ODliMDg0NTc3MjQ2MTczNDZhLmpwZw

106 sats \ 5 replies \ @nerd2ninja 5 Mar

I personally would do the typical 3% surcharge for using a credit card (convenience fee), plus a 3% fiat to Bitcoin conversion fee for using fiat (a 6% convenience fee basically).

I don't expect discounts on Bitcoin payment methods to be the sole reason for someone to look into Bitcoin. I do expect it will help with community building with other Bitcoiners as to get off of fiat.

As that community grows, there may be certain merchants who are part of this business network who don't deal in fiat at all. People like Nigerians (who yes, have a culture of scamming, but I'm hopeful about business practices that allow Bitcoin especially to navigate that) or El Salvadorians (simply because they don't have a bank and sending in cash would be too expensive and difficult for the customer)

This network of businesses would I believe attract fiat only users. It would be uniquely opened up to markets with cheaper prices than the fiat system and/or be uniquely higher quality. The people who participate in this community would seem comfortable and confident at all times and when everyone else is fighting inflation, figuring out what's going on with us might be attractive.

Another thing I think about sometimes, is we've put a lot of focus on accessibility and that's great and all, but I think we haven't put enough effort into "the Gucci strategy" which is the marketing of exclusivity and intentional inaccessibility. You see this in metal credit cards and in and out (secret menu animal fries).

For cases such as these, you could do a 50%, 100% 200% surcharge for using fiat or make it "Bitcoin exclusive" as in fiat not accepted here, you couldn't afford it. This is a market where branding is extremely important. "Yes, you have a bag, but its not a Gucci bag" or "Yes, you have a phone, but its not an iPhone".

Now, I understand this marketing strategy might be rather repulsive to Bitcoiners, but it might be kind of normal as the Bitcoin business community grows. At the very least, the cheaper products that we would get exclusive access to as a result of having access to unbanked markets would at the very least stir up the exclusive access fragrance a bit.

385 sats \ 1 reply \ @Voldemort 5 Mar

Now, I understand this marketing strategy might be rather repulsive to Bitcoiners,

Not trying to argue to are implying the contrary - but whether something is repulsive to bitcoiners should not be the ruler used to measure whether something is a good strategy to expand bitcoin use.

0 sats \ 0 replies \ @nerd2ninja 5 Mar

Well I say that because Bitcoiners have to operate the business that works in this way.

0 sats \ 2 replies \ @clr 6 Mar freebie

This is a market where branding is extremely important. "Yes, you have a bag, but its not a Gucci bag" or "Yes, you have a phone, but its not an iPhone". Now, I understand this marketing strategy might be rather repulsive to Bitcoiners

What I think is repulsive to bitcoiners is using a brand name as an indicator of status (appealing to shallow materialism/hedonism), rather than values/principles. The status thing, if it were to be done at all, should be based on achievements that fiat cannot buy. For me, having a Gucci bag or an iPhone is an indicator of lower status.

There have been a few "luxury" brands that have tried accepting bitcoin/"crypto" already. How has it gone for them and for bitcoin adoption so far? I would say it hasn't moved the needle or it might have even been damaging the bitcoin brand, in associating it with hedonism and shallowness.

138 sats \ 0 replies \ @AG0RA 5 Mar

Good conversation to have in the ~AGORA!

0 sats \ 0 replies \ @mwaters 7 Mar

When I started running ttrss.info the fiat and BTC prices were the same - 10 Euros. Since 2018 I have increased the fiat price by 2.50 Euros every couple of years. Now it is at 17.50 Euros. I keep a record in the Price Transparency section of the Payment page. https://www.ttrss.info/faq/payment/

0 sats \ 0 replies \ @joda 6 Mar

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0 sats \ 0 replies \ @grayruby 5 Mar

Interestingly enough the cost of territory rent has gone up by 50% in 3 months.

0 sats \ 0 replies \ @OT 5 Mar

10% is a pretty good discount IMO

I get it. We can hold for long periods of time so it does eventually work out well. Its just running a business has ongoing monthly & daily costs.

Offering too big a discount could give some entrepreneur an idea to buy ALL the product for a 30% discount, then sell it again 30% higher.

0 sats \ 0 replies \ @Arceris 5 Mar

While this sounds good, a 25-50% discount is, in many cases, unsustainable. Margins in most businesses are less than 20%, and often less than 10%. In restaurants, bulk margin is often less than 5% (very high margin on some things, balanced by zero or negative margin on others). If the business is a forced seller, say to cover high fiat-only costs, such a large margin is basically impossible.

That said, there are businesses (personal service businesses, consulting, &c.) where there is essentially no margin - it's just time. In those cases such a discount could be feasible.

A business I know about offers 2.5%-3.5% discount for paying in BTC, on top of other discounts (bigger volumes get the bigger discount). This amounts to roughly 25%-50% of their net margin. It works for them, but it is a big hit to keep that up, since they're a forced seller to fiat on their supply side.

0 sats \ 2 replies \ @TheBTCManual 5 Mar

I've been messing around with it in my business, I offer 20% discounts for bills settled in Bitcoin but I think people and other businesses just find it too complicated to use just yet, and a larger discount isn't going to get them over the hump

In my experience, I've noticed people are much more receptive to paying in stablecoins, which isn't too bad to convert into Bitcoin vs fiat

0 sats \ 1 reply \ @joda 5 Mar

Africa? Do your customers buy stablecoins or get them as remittances?

26 sats \ 0 replies \ @TheBTCManual 5 Mar

Yes, I'm in South Africa, I can't be sure where they source it from but I've been paid in stables from people locally, and from Dubai, India and Ukraine

0 sats \ 0 replies \ @filou 6 Mar freebie

Our IRL business offers customers a choice between added 3% credit card fees on top OR a 10% discount for bitcoin payments. Considering that most businesses operate on somewhere around a 30% margin or markup, being willing to offer customers a 10% discount is basically already cutting any ‘profits’ by 1/3.

On the other hand, I personally believe when it comes to incentivizing #Bitcoin use, the onus shouldn’t be on small businesses at all. IMO it should really fall on #Bitcoiners who want to incentivize bitcoin adoption to be willing to pay MORE in order to convince businesses to accept bitcoin as payment. Flip the tables. We want to be able to SPEND bitcoin everywhere and anywhere. The only way to make that happen is to make it worth while for everyone involved.

The more we are willing to spend our bitcoin, the more businesses will accept it, the more valuable it becomes – and the cycle continues.

I know I am personally happy to pay a small mark up to help support Bitcoin-based businesses and services. I’m also glad to offer a discount on my proof of work if you #paymeinbitcoin instead of fiat 🤙

(Repost from Nostr: note1w54jdrntdfqgwkzruet0pcsl6cvw4tw2ccegsskme2xgznx5680swma99q)

0 sats \ 0 replies \ @fm 5 Mar freebie

and it is feasible for you, consider making the discount much larger - maybe somewhere in the 25-50% range.

Services, maybe.. But products.. If manufactured and not luxury, the gross margin wont allow such. People dont even apply 50% gross margin, let alone benefits..