Fix Your Coupon Marketing Strategy with 10 Simple Steps
COUPON - MARKETING
Published On: June 16, 2022
For most customers, saving money is a priority when it comes to shopping. This is the reason online coupons are now an integral part of eCommerce marketing. Some of the latest coupon statistics
show up to 90% of customers use it in some form.
Coupons push customers towards making a final purchase decision and therefore are utilized by almost all brands. A study by Kelton shows that 48% of consumers are likely to make a purchase sooner if they have a discount offer at their disposal.
While coupons are a purchasing incentive for buyers, their value to businesses is much different. Allow brands to target different segments of the market, create customer profiles and get rid of any unwanted inventory.
However, couponing is far from a magic trick that will have thousands of customers buying your products overnight. Instead, like any other marketing tool, it can be extremely ineffective if not strategized properly.
Common Coupon Marketing Issues and Their Practical Solutions
If you have been tirelessly promoting coupons for the last several months and still seeing no significant increase in sales —you’re not alone. Many businesses make common mistakes when it comes to coupon marketing
and miss out on potential benefits.
Here are the 8 common mistakes you can address and improve your coupon promotion strategy in 2022:
1. Bound user for buying after landing on the website - Provide Limited Time Offer
Creating a sense of urgency is an art on its own. More the time potential customers spend wondering whether they should buy your product or not, the more the chances you will lose a potential sale.
There’s a reason limited-time offers are ubiquitous in the marketing world —they work. By limiting access, you can get loyal customers to act sooner rather than later. Research has shown that limited-time offers have a profound impact on sales. They play on the psychological phenomenon called loss aversion, where humans prefer avoiding loss over acquiring gain. The feeling of ‘missing out’ pushes many existing customers to make the final purchase.
Most businesses have these offers so the only way to have an edge over the competitors is to go a step further. If other retailers are offering 15% discount coupons, you can create a similar deal but throw in free shipping as well.
How to effectively create limited-time offers:
The goal of marketing is to inspire action. A tiered coupon strategy, it’s achieved in a few simple steps:
- Put a short time limit on the validity of coupons
- Advertise limited times offer heavy on pages with most of the traffic
- Use action words such as “Now” and “Last Chance”.
Avoid Creating Offers That Lasts for More than Two Weeks
On normal days, your discount code offers would last for 10-14 days. However, the best practice is to have these offers leading up to a shopping holiday like Black Friday and Thanksgiving.
2. Maximize Conversion of High-Intent Customers — Offer Exclusive Discounts
Most people who click on your website will not buy your products. That’s just how the world of eCommerce works. So there’s no point in wasting valuable time and resources to convince low-intent consumers.
Some offers should be reserved for customers who are on the checkout page and have added items to their cart. This way, you can give a final incentive to consumers who are on the verge of making the purchase.
Many businesses use coupons and promo codes to tackle cart abandonment (customers making it to the checkout page but never ordering the product). This makes perfect sense as even in brick-and-mortar settings, salespersons don’t throw out a discount for every customer that walks in. Instead, they are likely to make generous offers to customers walking away due to the high price.
Lessen Cart Abandonment With Relevant Coupons
It’s estimated that 70% of shoppers abandon carts due to a variety of reasons. Here is how you can encourage them to make the purchase:
- Use exit-intent popups that detect when customers are leaving and then send a popup message with a relevant offer.
- Customers mostly leave carts due to unexpected costs such as shipping. This makes free shipping coupons extremely effective.
- Create a brand loyalty program and reward systems to prioritize customers who are loyal to your brand. This will stop others from abusing your discount offers.
3. Prioritize Customers Buying in Large Quantity —Issue Tiered Offers to Incentivize Big Sales
It has become a norm for businesses to offer non-tiered discounts. While coupons with such value do encourage people to buy from you —there’s more you can do to make bigger sales. We have reached a stage in the evolution of coupons
where simple deals don’t cut it anymore.
Let’s say you have free shipping on orders above $45. This creates a scenario where there’s virtually no difference between orders of $45 and those of $450. Both get free shipping and nothing more. Likewise, when the offer is 15% off all purchases above $45, customers don’t exactly have an incentive to order anything that’s more than $45.
“Bigger purchases mean better revenue for eCommerce ventures,” says Alex Grey, Marketing Manager of ClothingRIC. “ Online retailers can invest in a tiered discount system, which is based on cart value to encourage bigger sales”. He exclaims.
In a tiered discount system, customers ordering above $50 can get a 10% discount while those with cart values above $100 can get 15% off.
Such a strategy will significantly decrease cart abandonment as high cost is often the reason people don’t make the purchase. A tiered approach will allow businesses to incentivize both high-volume consumers and those with lower cart values.
4. Understand Your Customer Base — Conduct Surveys
Marketers love to believe they know everything there’s to know about their customers. But is this the case? Sure, they realize which country the customers are from and how much time they spend on the website. But outside this; marketers rarely have any idea.
The lack of knowledge stalls marketing innovation and businesses are left with the same old online successful coupon marketing strategies. Without any idea of customer preferences, brands are left with commonly applied discount options where a certain percentage or amount of a product is reduced.
Of course, these are in no way bad strategies but businesses cannot afford to give $10 to $20 discounts all the time. More importantly, some customers might prefer other options such as:
- An opportunity to win a giveaway
- Share a referral program
Customers appreciate chances to win giveaways as it gives them a sense of achievement. Referral programs are effective as they allow customers to set trends and influence other purchasers. Meanwhile, gifts even if they are inexpensive allow customers to build a relationship with an online store and feel valued.
Some Common Ways of Finding Customer Preferences:
So before launching a coupon, ask your customers what matters to them.
The best way to do this is by conducting regular surveys. These can be done through:
- Phone Calls
- Social Media Pages
Surveys will not only give you real-time information but customers too will appreciate you seeking their opinion. Research shows customers like being consulted before a brand makes a big decision. Frequent surveys also inspire loyalty, which is never a bad thing.
5. Reach Maximum Amount of Audience — Utilize All Possible Channels
You can create the most powerful discount offer known to humankind —it won’t matter if it doesn’t reach the intended audience. Using appropriate channels means your messages get to people who are most likely to make a purchase.
Here are some common channels through which coupon promotion is possible:
- Social Media
Businesses use emails to disseminate coupons for the right reason. Data shows that 93% of customers subscribed to a brand’s newsletter are likely to use a personalized coupon they receive via mail. 40% share these emails with their friends. However, many such email coupons collect dust in the promotion tab, which makes it important to diversify the coupon distribution channels.
text open rate is as high as 98%, compared to 20% of emails. With that, the importance of mobile phones in the world of eCommerce can not be understated. It is estimated that 79% of smartphone users in the United States have made a purchase using their cell phones. Going forward, mobile devices will dominate online shopping as 72% of all e-commerce will take place on these devices by 2021. While it would be unwise to spam someone's inbox with coupons, brands should occasionally use text as a medium for promoting their latest deals.
Social media is another avenue that shouldn’t be ignored when it comes to coupon marketing. It’s estimated that around 71% of customers follow brands on social media for the sole purpose of getting the latest coupon redemptions. Different studies have shown that almost half of the planet uses social media. So if you can get your coupon marketing on Instagram, Twitter and Facebook right, there's a great amount of revenue to be made. Of course, don’t ignore emerging platforms like TikTok, Lasso, and Vero as well.
Meanwhile, it is important to seek out relevant forums and blogs for advertising coupons. If you’re in the business of fashion, make sure to look out for forums and blogs that fashion-lovers visit regularly.
6. Select The Right Coupon Type Digital/Traditional
A key component of a coupon marketing strategy is understanding the difference between traditional and digital coupons.
The first question that will come to your mind as a brand owner is which approach you need to prefer. In general, there are particular approaches—online, conventional, or a combination of both types of coupons.
After Covid-19 people prefer online shopping and use online coupons rather than visiting stores.
But it doesn't completely rule out the option of using traditional coupons. Online coupons can be useful in some situations, particularly for software companies, but some businesses still prefer to use traditional coupons.
According to research, more individuals favor online digital coupons than paper coupons. If you go ahead and physically distribute discount coupons, it will not only be seen as less environmentally friendly but also cost a lot of money for printing, sorting, and distribution.
7. Keep Coupon Marketing Strategic —Reserve Best Deals for Rare Occasions
If you’re not careful, couponing can be detrimental to your business. Frequent discount offers mean less profit on sales. So to make sure you’re not going overboard, analyze how coupon marketing is affecting your bottom line.
Jay Goltz, in his New York Times article, has invented a simple formula to determine whether or not deals and discounts are a worthy option for your business. It gives an idea of just where coupons fit into the marketing puzzle.
With coupons, there’s always a danger that your regular customers will develop a habit of waiting for deals. If this happens, you will end up with a customer base that will refuse to spend over a certain amount on the products. This means reduced profits with the cost of purchasing or production staying the same.
Another detrimental effect of frequent discounts is that your product will start to feel less valuable. Lead magnets will seem more like tools to get emails and followers on social media, which will damage your brand’s credibility. To avoid all this, plan your discount coupon around special occasions such as holidays and anniversaries. It makes the most sense as customers usually shop around these events.
8. Build Better Partnership With Affiliates —Get Them to Comply
Nowadays, most brands work with digital coupon offer sites through affiliate programs. To make the best of this relationship, businesses should invest in their partners. Start by analyzing which websites you’re currently affiliated with and determine how much value they are providing.
Your commissions should be based on outcomes such as new customer acquisition, conversions, and brand awareness. Only websites that add significant value to your business should get large commission payouts.
Similarly, examine affiliate websites based on relevancy. Visit these websites and see whether they have a prominent section or applicable category that’s relevant to your products and offers. Promoting your deals on irrelevant websites is nothing more than a waste of time and resources.
How to Get Digital Coupon Websites to Comply:
Getting websites to comply with your established standards is extremely important. Affiliates should know what is permissible behavior. Let them know there’s no room for hot buttons such as promotion of expired coupons, trademark bidding, advertisement of offers that do not exist (such as up to 60% discount), and other click-bait tactics. Make sure to at least visit these websites once a week to ensure compliance.
Lastly, invest in your relationships with affiliates. Create exclusive coupons for your different sites and encourage them to promote your brand. Small gestures such as boosting their social media through your (e.g; sharing and retweeting their content) or linking their blogs on your site can go a long way in establishing trust and loyalty.
9. Improve Coupon Marketing—Hire Someone With Expertise
Companies should realize that coupon marketing is a complex promotional coupon operation that should be managed by experienced professionals. Whether you have an in-house manager or services of a specialized third-party firm —it pays to have experienced hands at the helm.
Someone with expertise in coupon marketing can work closely with digital coupon code websites and apply methodologies to determine what’s converting leads into buyers. They can also use their knowledge to optimize new customer acquisition and incrementality with affiliate websites.
Who Should Manage Your Coupon Marketing?
Companies have two options when it comes to managing coupons:
- In-house managers
- Third-party agencies
As the title suggests, in-house managers would be an individual hired by your firm to supervise couponing. Meanwhile, third-party agencies are present on affiliate networks. Both of these entities will make sure that affiliates are complying with the company's standards. They would also make certain that exclusive coupons that are designed for a particular website are not being promoted through other mediums.
10. Decide Which Deals You Want to Offer
The coupon technique is well known for lowering a percentage or dollar on particular items. Coupons can also be found in a variety of other formats. The consumer numbers at ease can be greatly increased by incorporating the following incentives.
Referral incentives can be thought of as a strategy where customers might feel like establishing trends. The customer will represent your business by suggesting your goods to their friends and family using an exciting choice of referral codes.
Even if you like something, you occasionally change your mind after seeing the shipping cost on the website.
Therefore, offering coupons for decreased shipping costs might bring in more people and boost your brand awareness.
One of the most crucial elements in maintaining a business is creating goodwill for the clients. By giving consumers presents and handwritten messages, you can accomplish that goal quickly.
When done rightly, online coupon marketing can boost the company’s revenue and entrench a company’s digital footprint. On the flip side, botched voucher marketing strategies do more harm than good.
Sometimes it’s the lack of urgency created by coupons with an extended expiration date. Other times, it’s non-tiered offers where customers making big purchases do not get any additional benefits. By fixing these issues and making some additional changes in their deals and discount marketing strategy —brands can create a discounting model that’s both sustainable and compliments their overall digital marketing efforts.
For an efficient discount promotion strategy brands should:
- Create urgency through limited time offer
- Shift attention to customers who are more likely to buy
- Establish a tiered discount system
- Survey customers before creating discount offers
- Promote coupon codes on multiple online outlets
- Don’t go overboard with deals and discounts
- Build a value-based relationship with coupon websites
- Have professionals manage your coupon marketing campaigns
Lastly, do remember that coupon codes alone can not grow your small business. Instead, they work best in conjecture with your other marketing tactics. If customers do not perceive value in your product, they will not buy despite how generous your discount offers are. So study your customers, and their expectations and then create coupon marketing ideas for increasing sales.