The History of Coupons in Retail and eCommerce
1887 marked the beginning of the use of coupons; Coca-Cola co-owner Asa Candler realized that utilizing coupons to increase brand exposure would boost sales and benefit his business. Since then, the popularity of coupons has risen steadily. The early 1900s offered shoppers coupons on dry goods like cereal; but their heyday came with the storm of the Great Depression.
Since that time, coupons have remained a popular way for consumers to save some cash and for brands to push their products. Despite a brief decline in use during the early 90s, coupons were popular during the 2009 recession and have experienced an upswing in popularity ever since.
Coupon and promo codes have emerged in recent years as a means for shoppers to save money at checkout on eCommerce platforms. Retailers can offer site wide discounts, alleviate shipping costs, and give access to special products by simply sharing a code with consumers. These promotional codes can be the defining reason customers move through the online checkout process.
Why You Should Utilize Coupon Codes in eCommerce
The fact of the matter is that consumers have been conditioned to expect the availability of coupon codes when they shop online. A host of retailers run various promotions on a near-constant basis to pull shoppers in and convince them to finalize sales. If you don't offer some sort of coupon code for your products, many of today's online shoppers will simply walk away.
Coupon codes should be seen as an absolutely vital aspect of your marketing toolbox. Provided you understand the best strategy for maximizing profits and driving sales, you should never be losing sizable amounts of cash from running promotions. Coupon codes that incentivize buyers to add more items to their carts or hit higher checkout totals are ideal.
Unique and innovative coupon codes and promotions can drive conversion. You can push consumers onto your site based on impulse alone if the deals you advertise are enticing enough. Cart-level discounts offering things like a free product if you buy two others push conversion rates up sizably.
Types of Coupon Codes
- Free shipping coupon codes
- These codes help nix the cost of shipping for buyers
- Shipping costs are, arguably, the biggest pain point for consumers shopping online; 44% of shopping cart abandonments occur due to shipping charges
- If you're shipping exceptionally large or heavy items, you'll need to consider restrictions on which products can ship for free
- Total cart value coupon codes
- Ideal for scenarios where site-wide discounts are unrealistic
- Total cart value promo codes restrict consumers to applying discounts only to orders that meet certain criteria
- Order value
- Number of products purchased
- Oftentimes "X% off orders over $X" or "Buy X items, get $X off"
- Money or percentage discounts
- The most popular, straightforward type of coupon code
- Discount item and/or order price by a specific amount
- Dollar or percentage
- Ideal for low-priced items that combine to total $100 or less
- Most commonly "X% off of your order" or "$X off of your order"
Best Practices for Leveraging Coupon Codes
There are a few key things to consider as you integrate coupon codes into your eCommerce platform. As with any other sales decision, it's critical that you adhere to best practices in order to minimize customer issues.
- Target usage
- Targeting sales and promo codes to customers that meet certain specifications
- Ideal for rewarding shoppers that meet requirements without alienating those who don't
- Can be completed in several ways
- Ensuring site visitors URLs meet certain parameters before displaying pop-up windows with promo code information
- Displaying promo code details only to consumers who reach your page through affiliate links or campaigns
- Use different terminology
- Referring to a promo code as something else (i.e. as a voucher or special offer code) helps consumers feel less targeted and makes you seem less salesy
- Using slightly more vague terminology also means that the only consumers who'll pick up on your message are the ones that you want it to reach
- Make your coupon code practices known
- Offer a small symbol near the promo code input box that leads buyers to more information about your practices and rules surrounding these codes
- You can provide examples of past promotions and clearly lay out the terms behind your sales and codes
When (and When Not) to Use Coupon Codes
With the unspoken understanding that you should never execute a plan that'll put your business at risk, it's rare that merchants will have a reason not to offer shoppers some form of coupon code. Coupon codes are an excellent solution to:
- Outdated or slow-moving stock
- If you know that certain products won't sell without a push from your end, offer a discount on them!
- You can publicize promo codes for certain products or brands
- Offering free shipping with the purchase of a specific product, collection, or brand can also help move inventory
- Lagging conversion rates and lack of customer interest
- Everybody is interested in a good sale; if you're worried about consumer engagement, conversion rates, or the general excitement surrounding your business, you can pull customers in with coupon codes
- The need to show customer appreciation
- Consumers are becoming more and more interested in connecting with the companies they buy from
- Offering coupon codes can help your audience feel in-the-know and appreciated
- The need to reward new customers
- Offering customers X% or $X off their first order with a company has become increasingly common
- This is a great way to go about fostering consumer retention
The Future of Coupon Codes
As technology advancements and innovation come faster and faster, it's no question that coupon codes will see changes as well. The implementation of chatbots across many online platforms, for example, now allows consumers' attention to be caught before promotional codes are presented to them.
The influence of AI has also come to the world of eCommerce. Computers and machines can now work on their own to improve consumers' experiences and provide personalized assistance where it's needed. Marketers can utilize AI and predictive technology to understand what consumers want when they land on a website-- sometimes before the consumers know it themselves. This translates to more targeted and effective marketing through promotions and coupon codes.
If you're interested in integrating your eCommerce and marketing automation platforms to make the task of marketing through coupon codes easier, check out Unific's coupon code generation capabilities.