Since Coca-Cola introduced the first ever paper coupon in 1887-which saw the beverage company solidify its brand bring in more revenue-this marketing strategy has been utilized by almost every retailer and brand to grow their business.
According to WikiGains, a UK coupon site, business owners who understand this marketing concept well can use it to successfully create a favorable image of their brand, boost customer satisfaction as well as drive more sales and boost their long-term profitability.
The following are four things marketing studies have found about coupons, and how you can use them to grow your business.
- Promotions influence purchases
A global survey in 2013 found that out of the 10, 009 participants, 51% agreed that when shopping online, they were influenced by discounts and deals. In the U.S alone, 56% of the 1000 correspondents gave similar feedback.
Business owners can use coupons to encourage their existing and potential customers to discover and purchase new products and even spend more money in their store. Again, coupons can be used to encourage consumers to add specific products into their cart including higher-margin items and out-of-season items.
Coupons also encourage sales of related items. For instance, if a customer visits your online store to redeem a coupon on a shirt, they could see and like, say, a pair of trousers and decide to purchase them as well. If your products and customer service are good, the customer is likely to come back.
- Coupons boost overall revenue
According to Inmar, an intelligence commerce network, out of the 319 billion coupons that were distributed last year, 2.84 billion were redeemed by consumers. These days, crafty consumers know where and when to find good deals, and therefore, only brands that give attractive special discounts create win-win situations and attract more shoppers.
A survey done by BIA/Kelsey, an advertising company, shows that “small businesses estimate that 17.7% of their total sales in the next year will be as a result of such customer acquisition promotions as daily deals, coupons, discount deals, among other similar offers.” A successful business owner will use multiple channels to attract customers and increase sales. For instance, understanding that consumers include individuals who pay full prices and those who eagerly wait for discount offers, a smart brand will issue special deals that will encourage both groups to make return visits.
- Discount offers discourage cart abandonment
Coupon experts from WikiGains say that without a coupon, more than half of shoppers will most likely fail to complete a first-time purchase. In fact, some shoppers feel that for any brand looking to acquire customers, a discount for first-time buyers is a prerequisite. The research also reveals that about 62% of shoppers use 1-2 hours online every week scouring for promotions and discounts. Without special deals, many customers abandon carts.
As per WikiGains, if a retailer offers a discount, up to 91% of shoppers who redeem the coupons are more likely to complete their purchase and even make return visits. As long as the buyer finds value in your products, they may even buy them at full prices when they come back.
- Coupons create happiness
A 2012 study led by a Claremont Graduate University neuroeconomics professor, Dr.Paul J. Zak, found that coupons make people happier. Researchers discovered that individuals who received a 10$ voucher had a 38% increase in oxytocin levels. They were also 11% happier than shoppers who didn’t get a coupon. Their respiration rate also dropped by 32%, their heart rates decreased by 5%, and they felt less stressed and more relaxed.
Shoppers find joy and delight in receiving exclusive discount offers, and most of the time, they are even happier when they get an unexpected offer from a favorite brand which rarely gives discounts. Therefore, a coupon may be all you need to spark a shopping spree.
WikiGains believe that ultimately coupons will significantly help you to acquire new loyal customers, encourage repeat business and drive new product sales. However, you should also learn to preserve the integrity of your brand by, for instance, knowing how much coupons you should offer and avoiding deep discounts and promotions.