Coupons and discounts are a valuable way for e-commerce shops to boost sales. Getting a coupon or discount offer can push a potential shopper to click that buy button. Coupons can convert new customers and bring back old customers. Coupons can ultimately boost revenue and help move product.
Why Use Coupons?
So what makes coupons so great in the first place? They make people buy. Here are some interesting stats to back up the power of coupons:
- 50% are more likely to visit a store if they have a coupon.
- 60% of first-time shoppers will complete a purchase if they have a coupon.
- 57% of online shoppers say they wouldn’t have bought something if they didn’t have a coupon.
More than being good for your bottom line, coupons also make shoppers feel better. Exactly 11% better.
According to a 2012 study about what science says about discounts, shoppers who received a coupon had a 38% rise in oxytocin levels, their respiration rates dropped 32%, heart rates slowed 5%, and sweat levels were 20 times lower. In short, shoppers were less stressed and more relaxed if they used a coupon to make a purchase. And they were 11% happier. All thanks to a coupon.
The Negatives of Coupons
Of course, coupons aren’t a magic solution that prints money. There are potential downsides to using coupons:
- Coupons can negatively impact your brand. All that discounting can devalue your products or services.
- If you don’t carefully plan your coupons, they could reduce your overall revenue.
- Coupons don’t work on all customers.
- There’s the potential that you could be training your customers to wait for coupons.
Coupons aren’t a magic bullet, so coupon tracking is the best way to make sure you’re making the best decisions. You’ve got to have the right strategy to make sure your coupons are working for you.
Developing a Strategy to Boost Sales with Coupons
You need to think smart about your coupons. But what is the right strategy? That’s hard to say. It will vary by store and should fit with your wider brand strategy.
Here are some coupon strategies that might help:
- Hide coupon field: One study found that 27% of cart abandonment is due to shoppers leaving to look for coupon codes, so stop encouraging that behavior by hiding your coupon field.
- Change the name: This one is admittedly silly, but simply changing the name of your coupon field can help. Ask for discount or promo codes instead of coupon codes.
- Create a coupon page: Another way to combat shoppers running somewhere else for coupon codes is to create your own coupon page. So when shoppers Google your store name and coupons, they come up with your own coupon page. Then you can use a coupon as a lead magnet and add them to your email list.
- Expiration date: Always include an expiration date on your coupons. Not only does this make it easier for you to manage coupons, but it creates a sense of urgency for shoppers.
- It’s all about timing: Space out your discounts and coupons so they’re spread apart and come at timely seasons. Don’t offer a discount during your busy season, offer it during a lull to help goose sales. And don’t turn around and offer another discount two weeks later, spread those discounts out throughout the year.
- Not rational: Shoppers aren’t always rational. When offered 33% off or 50% more for free—which amounts to the same thing—shoppers overwhelmingly go for 50% more. Getting extra for free feels like a better deal than saving money. So as you experiment with coupons, try to offer something extra instead of a simple discount.
- Clearly communicate: Finally, however you do your coupons, make sure you’re clearly and consistently communicating about them. If you change your coupon field to a promo code field, make sure you call them promos in your marketing.
Bonus: Tracking Coupons in WooCommerce
You need to think smart about your coupons, and then you need to pay attention and see what works. If you’re running a WooCommerce store, using a WooCommerce reporting plugin like iThemes Sales Accelerator can help you keep a quick eye on total coupon sales and know if your coupons are working.
These questions can help you evaluate the data:
- Do you get a surge in coupon usage when you send a discount to your email list?
- If coupon use is going up, are other important indicators also going up—such as new customers, average order value, total revenue, etc.?
- Are total coupons rising while average order value is falling? You might need to rethink your coupon strategy and give a minimum order or number of products threshold.
Coupon tracking can help you see what’s working and what’s not. Then you can adjust your strategy as necessary. If your coupons aren’t working, you might need to revisit the strategy above. Or you might need to make some tweaks. Maybe you need to change the threshold for a discount or increase the coupon minimum.