In brief: A loss leader is a product sold with a very low or negative margin in order to bring the customer to a subsequent purchase. The model works only with control over the entire basket and repeat purchases.
How I use Loss leaders in practice
With a Loss leader, I start with the recipient’s expectations: why they receive the message, what value it will bring them, and how easily they can change their choice. I separate operational communication from marketing communication, segment by relationship and behaviour, and before sending I check the sender, links, mobile display and the next step.
What to watch out for
Do not treat the open metric as the only proof. Technical privacy protections can distort it, and a nice number does not say whether the message helped a decision. A Loss leader must also have a working unsubscribe option and a clear distinction between necessary and promotional communication.
Questions for decision-making
- Why should the recipient receive this message right now?
- Do we have a documented purpose and the right type of consent?
- How will we verify delivery, response and business benefit?
- What happens in the event of an error, unsubscribe or change of details?