Do you have promotional codes? Push them to the limit!
Coupon, discount code, voucher, offer... as consumers, we all like these magic words. We search for coupons on the net, receive offers in our mailbox, and wait for discounts to shop at our favourite online stores butwhere are the offers more appealing and attractive.
As retailers, those words are a powerful marketing tool, which requires an accurate planning process.
What is the user profile like today?
Proactive, restless, unloyal and a savvy saver. He/she searches for coupons proactively, finding out what offers he/she can use in his/her favourite shopping website or going to different stores if promotions there are fitting his/her interests in a better way.
From the advertiser/brand point of view, what is the aim of an offer or coupon?
The most important goal is to increase sales, but also benefit specific actions such as newsletter subscription, website registration, feedback on service, enhancing new payment methods...
How many coupon types are available?
An offer can be directed to certain audiences or be restricted to a specific target. An example could be a discount only for students or retired people.
What can you get from a coupon?
- Reach new clients
- Enhance future sales
- Increase sales in low season
- Collect information about consumer choices and opinions
- Gain links to the shopping website
- Enhance new or specific payment models
- Boost the average order value
- Sell overstocked products
- Introduce new products on a market
How should you set up a promotion or coupon?
Fix the average order value and offer discounts above that average. Also targetclients and determine who you want to give your bonus to.
How do you calculate a coupon?
It's easy! Let's say we have a margin of 50% and we are planning to offer a 10% discount. With an average order value of 100€ the benefit is 50€. Offering the 10% discount to obtain the same benefit, the transaction has to grow by 25%.
What if we offer a 20€ discount when spending more than 200€ (which represents the same 10€)? We first increase the average order value, since consumers will probably spend more than 200€. Second, our benefit for a 200€ order is 100€. So in this case the transaction only has to grow by 14%, less than in the previous example.
What key advice should you follow when promoting offers and coupons?
Preferibly, place the coupon box as low as you can at the checking out area of your webiste. Advanced users who have a code will screen roll to find that space, but the rest won't see it. Otherwise, there is a high chancedisappointed users will goto other pages to search for an available code.
Keep all your coupons and vouchers up to date, and affiliates will display them in more visible and relevant locations.If there's no way you can offer discount codes, promote your outlet section or specific offers. This way you can still gain the consumers' interest and affiliates will stick to your content.