A Malaysian premium skincare brand we have been tracking made a decision in late 2024 that most of its competitors would not consider. It stopped discounting.
Not reduced. Not strategic. Stopped. No 11.11 sale. No double-day discount. No first-time-customer offer. No bundle pricing that disguised a discount as a deal. The full-price product, all year round.
The first six months were not pleasant. Revenue dipped 8% versus the prior year. The competitive set ran promotions. The brand stayed quiet. Customers complained on social media. The founder reportedly considered reversing the decision.
What happened at month seven onward was the part the founder did not predict. Repeat purchase rate increased. New customer acquisition slowed, but the customers who did come through stuck. Average order value rose, because customers were no longer waiting for promotions to stack purchases. Refund rate dropped, because customers were buying products they intended to use rather than products they bought on impulse during a sale.
The Editor's Note
If you are reading this and the pattern fits your business — start the conversation before the conversation starts itself. editor@unpublished.my.
By month twelve, gross margin had moved from 38% to 67%. Revenue was still 4% below the prior year. Profit was up three times.
The lesson is not that discounting is always wrong. It is that discounting trains a specific kind of customer, and that customer becomes the only customer your business knows how to serve. The discount becomes the relationship. The brand becomes the bargain.
Stopping is hard. Customer complaints are real. Competitive pressure is real. But the cost of staying inside the discount loop, compounded over a five-year market cycle, is larger than the short-term revenue dip of stepping out.
