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Down-sell is a technique in marketing and sales that you have to use when a customer is backing down from a sale because of budget constraints.  The seller must conform to the buyers budget by offering a cheaper substitute relative to his preferred choice.  So it's like giving a buyer the best option that would fit his budget.

 

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Posted (edited)

Down-Sell? It's actually somewhat similar to what sellers do here in the Philippines tho. It's actually called "Tawad" in Tagalog and "Hangyo" in Cebuano where the sellers drop down the price of their products just so that the customers won't back out. If they are the same, well it's very interesting to know that there's an English word for that because it's so hard to translate it to foreigners. Actually, I've heard that this kind of thing originated from China and the Chinese Businessmen before during the 15th century I guess, according to my not-so clear memory of our History class during High School. They are really good with selling their products because of this technique. 

Edited by jaybee

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Down-selling is quite an important thing to remember because it's a much better option than actually losing the customer and not getting any revenue from them at all. Whilst it's not great to potentially be getting less because the budget of the customer restricts them, it's much better to get that lower amount. It's a great tactic and it's good for both because the business gets income and the customer gets a product that is similar and for a price that they can afford to spend.

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Well its a good way to gain costumers but i think it will affect profit. Of course you wouldn't sell a product with a definite loss that won't be logical. But i think they down sell price for a much lower profit. In these case it would help in terms of costumer satisfaction and eventually lead to regular clients. Good point...

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Sometimes, down selling helps gain more especially on items that have spent way too long on the shelf and have no chance to be bought with their regular price. 

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18 hours ago, jaybee said:

Down-Sell? It's actually somewhat similar to what sellers do here in the Philippines tho. It's actually called "Tawad" in Tagalog and "Hangyo" in Cebuano where the sellers drop down the price of their products just so that the customers won't back out. If they are the same, well it's very interesting to know that there's an English word for that because it's so hard to translate it to foreigners. Actually, I've heard that this kind of thing originated from China and the Chinese Businessmen before during the 15th century I guess, according to my not-so clear memory of our History class during High School. They are really good with selling their products because of this technique. 

That's bargaining, down selling is when the seller offers you another brand which is cheaper or instead of a specialized one, a standard or stock model would be offered which is more appropriate for your budget.  When buying a TV you may pick a good brand let's say a Sony but it's to pricey for you so the best thing for a sales personnel to do is to down sell and ask you your budget and suggest that you buy a lesser priced TV like a smaller sized Sony TV or a different brand with the same size but with lesser features and price like a Sanyo or JVC or TCL.  Doing this will save the sale and make a profit for the company.

4 hours ago, fishbate said:

Well its a good way to gain costumers but i think it will affect profit. Of course you wouldn't sell a product with a definite loss that won't be logical. But i think they down sell price for a much lower profit. In these case it would help in terms of costumer satisfaction and eventually lead to regular clients. Good point...

It could have a minor effect in profit but it really depends on the item profit margin.  If someone expresses that he would like to buy a Samsung S9 worth but he doesnt have the money, the sales Personel can ask his budget and find another phone which is within his budget or offer a lesser priced Samsung S8, doing that will save the sale and will earn the company some profit and a new customer.

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16 hours ago, Ash said:

Down-selling is quite an important thing to remember because it's a much better option than actually losing the customer and not getting any revenue from them at all. Whilst it's not great to potentially be getting less because the budget of the customer restricts them, it's much better to get that lower amount. It's a great tactic and it's good for both because the business gets income and the customer gets a product that is similar and for a price that they can afford to spend.

Couldn't have said it better.  It's always best for a business to sell something to a customer than lose a customer who has the money to buy something from the store right?  It's better to get some revenue than nothing at all.

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