How And When To Use Coupons On Your Site For An Effective Marketing Strategy
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Building an ecommerce site doesn’t mean that it will be successful. The site is only 1/2 of the equation, the other 1/2 is buyers. To be successful you need to attract buyers. There are a lot of different ways that you can attract new customers to your site and encourage previous buyers to return. Books have been written, courses developed just to show you how to drive a steady stream of buyers to your site.
One method that has worked in retail almost since there has been retail is couponing. Everybody loves coupons, and that means that EVERYBODY loves to use coupons. Building a coupon marketing strategy is one of the absolute best ways to drive traffic. They work because coupons, as a concept, serve one single purpose, changing the user’s buying habits.
What Are Coupons?
Coupons are a pull marketing strategy that merchants use to change buying habits. The hope is that, if you change your habits once and like it, that the new habit will stick without the need for more coupons.
If you normally buy brand X wine but you get a coupon for brand Y wine, the hope is to break your existing buying habits and convince you to try brand Y.
Additionally, some coupons are designed not to make you change brands but to buy more. Some coupons for brand Y wine are not for people who have never tried brand Y but those that regularly buy a bottle. The hope is to change their buying behavior by convincing them to buy more than they usually do.
Both of these types of coupons are trying to change buying behavior, but each targets a different behavior and thus a different group of consumers.
Physical coupons are usually printed pieces of paper with a discount code on it that retailers will honor. Many times physical coupons are distributed by the postal service, however, in some cases, they are handed out at a store. Physical coupons are more costly for retailers because there is a physical cost to creating and distributing them. Even if they are printed on a copier and handed out by employees at the store, they cost. This means that retailers are more cautious about what they offer with physical coupons. Experiments are more expensive so most retailers stick with what they know will work to change behavior.
On the other hand, digital coupons have almost no costs associated with creations and distribution. If you are using WordPress and WooCommerce and want to run an online coupon marketing strategy, you can create a 10% off coupon for your T-Shirts and send it to everyone on your mailing list. Your total cost for this was the time it took to enter the coupon into the system and write the email.
Because they are so cheap to create, many retailers set their online coupon marketing strategy incorrectly. They will literally create a 10% off coupon for one of their products and send it to everyone they can, hoping that if they send it to enough people that they will generate some sales. The problem with this “shotgun” approach to coupons is that if you do it enough, the only behavior you are changing is that you are teaching your customers to wait to purchase until you send out a coupon. This is not the behavior you want from your customers.
3 Key Ecommerce Coupon Marketing Tips
In order to create an effective coupon marketing strategy, before you create your first coupon, ask yourself, “what behavior am I trying to change?” Then, figure out which customers have that behavior, and craft not only a coupon but a message specifically for those customers.
1. Set the behavior you want to change
Let say you want to increase your average cart value, the amount of goods that a customer buys in any given transaction. One way to do that is with a digital coupon.
For every customer that regularly purchases from you, but purchases less than $50 per transaction, send them a coupon to give them a 10% discount on their next transaction if it is over $75.
Don’t send them more than 1 of these coupons and don’t send this coupon to every customer on your mailing list. Only send it to customers that have already purchased from you once and you expect to purchase from you again.
For each customer that uses this coupon, you have changed their behavior, at least once, and increased your average cart value for that customer. Whatever you do next, do not send this customer another “10% discount when they purchase $75 or more” coupon. Sending them the same thing over and over just encourages the bad behavior of waiting for the coupon to arrive before purchasing.
2. Personalize your coupons
Digital coupons are easy to personalize. Up to this point we’ve talked about sending out coupons to groups of customers, but you can easily create a coupon that is good only for a specific person. The most common version of this is a birthday salutation.
If you have collected your customer’s birthday (or any other special life event date) then you can easily send that person a happy birthday email and a special discount coupon good only on their birthday.
If you are going to do this, make it personal.
HAPPY BIRTHDAY, HERE’S 10% OFF OUR LATEST BOOK
TODAY IS YOUR BIRTHDAY, SINCE YOU LIKE X, HERE IS A 30% OFF COUPON FOR X IF YO BUY TODAY.
CAL, TO CELEBRATE YOUR BIRTHDAY TODAY, WE WANT TO GIVE YOU A 30% OFF OF X BECAUSE WE KNOW YOU LIKE X. IT’S ONLY GOOD TODAY.
The best scenario above takes more time because you have to do a little research. You have to figure out who is having a birthday tomorrow. If they are a regular customer, you also want to figure out what they buy the most of and offer them a coupon for that.
This type of coupon builds brand loyalty. By offering a sizable discount on something they already purchase from you, you are letting them know that you appreciate their business. This will stick in people’s mind and they will remember it the next time they go to buy anything that you sell.
You can do this for customers that haven’t bought from you yet but you need to remember two things:
- It needs to be sincere
- It needs to be a steep enough discount to cause someone to buy something from you.
A generic Happy Birthday email with a 10% discount on something the person would never purchase to begin with, will likely be deleted without even a click.
On the other hand, a sincere happy birthday that greets the person by name and offers them a 50% off discount this one time as your way of celebrating their birthday will most likely move the needle.