Isn’t Loyalty Discounts program increasing the undercutting problem?

Actually, we believe the opposite will happen. Buyers will spend credits which will cover up to 30% of the price. Therefore the higher is the price the lower discount you will have to give away.

For example, if the buyer has 5 credits:

  • for $15 model, 5 credits will cover almost 30% of the price, the final price will be $10.5
  • for $100 model, 5 credits will cover only 5% of the price, the final price will be $95

Therefore, it will give pressure to undercutters, they will have to increase prices in order to reduce the potential discount.

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