Coupons are widely used in the offline world, but they also are a great ecommerce promotional tool that can boost conversions in your online store.
There are many good reasons to use online coupons. You can use them to:
- Capture or maintain clients
- Clear stagnant inventory
- Seduce customers with accessories or complimentary products
- Introduce a new product
- Open a new territorial e-store or
- Target a new segment or boost sales in a specific period.
However, be careful to avoid common coupon pitfalls…
Shopping cart abandonment is a challenge that all digital ecommerce merchants face. In many cases, the problem stems from the checkout page itself. A coupon code box in the checkout page often invites the customer to search for a better deal. When this happens, in the best scenario, the customer will come back with the discount code – so he/she won’t pay full-price, but you still make the sale. Additionally, if the customer found the coupon through one of your affiliates, you will have to share your profit. In the worst case, the customer you invited to abandon your e-store will never be back.
There are, however, good solutions to avoid this problem and create an effective coupon campaign. First, consider removing the coupon code box from your ecommerce site. Instead, create a specific landing page for each coupon where the offer is automatically applied. This way, you will boost the natural flow from coupon to checkout page instead of vice versa. Landing pages also offer great options for customization of message and call to action, as well as targeted conversion tracking.
Coupon Code Box
If you still want to keep the coupon code field on the checkout page, but want to prevent the off-page hunt for the coupon, consider including a “How can I get this?” link that leads to a voucher page on your site. Such a page can provide the essential coupon code info and quickly send the shopper back to the checkout page. This will reduce transactional friction for your visitor, keep them on your site, and let you avoid affiliate fees.
Time to plan your campaign:
The final purpose of the coupon has to be to generate traffic to your ecommerce store and convert, convert, convert. As with any other marketing tool, you need do some homework first:
- Does the coupon campaign fit your general marketing strategy? Coupons can be associated with low-quality products. Discount hunters have a low brand loyalty. Remember, a coupon campaign is a short-term tactic! If you train your customers to always expect discounts, it is very hard to untrain them. Your full price could be gone forever.
- Define your clients profile based on accurate data. Do not make assumptions and conduct tests to understand your consumers’ behavior to make sure whether they will respond to a coupon campaign. For example, we were very surprised when we read this survey and found out that coupon lovers are more likely to be high household incomes and college-educated. If you know what your customers want, you can match it up! Specify an objective: increasing sales, getting customers to spend more than the average, building an email list, attract followers to your Facebook page, boost the sale of a software product before launching the next version. Goals set upfront will help you determine the campaign’s success post mortem.
- Decide on your target. You have basically three options: private, public and group coupons. If your aim is to get new customers or build an email list, you’d rather target a massive public through public or group coupons. But if you want to gratify the customer, get followers or improve affiliates’ loyalty, private promo codes –-distributed directly — is the smartest choice.
- Do the math. Set your budget (and stay there!). A coupon campaign will cost you some money (designing the coupons + landing pages, distribution and promotional costs, human resources, discount offered, etc.) The goal is to earn money so if you don’t carefully calculate costs, the campaign will quickly eat your profits.
- Measure the results of the campaign. It is essential to confirm the success or failure of your campaign and learn to improve future ones. Some indicators of success are: ROI, conversion rates, number of new consumers, web and social media traffic and interaction, emails collected, etc.
“Ok, I’ve prepared the strategy, I’ve checkout the things-to-do-before-launching-a-coupon list above, but what can I offer?” Of course, you want to offer those deals that convert best, for example:
- Money or percentage off coupons (Discount must be tied to a minimum number of items acquired or to the minimum amount spent which should be higher than the average).
- “New customers save X$ on any order over Y$ if you place your order now” or “Save X$ if you buy now” (evoke a sense of urgency).
- “Deal of the Day Promo” (Must be a real bargain to be effective).
- “Exclusive Coupons to Selected Affiliates” (exclusivity will attract your affiliates and motivate them to distribute your coupon).It is important that you set some redemption requirements, like ensuring that the customer spends more money than the average.
However, the holy grail of your coupon campaign will be returning customers. Craft a customer retention strategy integrated to your coupon campaign by following-up and having more products worthy to return for.
By the way, don´t forget to test your coupons and make sure that the links work and the promise is applied!