Coupon codes are an important part of eCommerce as they can be an effective way to increase conversions and make customers feel valued. In fact, 68% of shoppers say that coupons make them feel loyal to brands.
However, you’ll need something more thought through than a blanket coupon approach if you want to succeed with this tactic. With the risk of losing revenue due to the rise of coupon aggregator services such as Honey and Pouch, eCommerce businesses should consider a more targeted eCommerce coupon marketing approach using unique coupon codes and segmentation.
Keep reading to learn about the benefits of unique coupon codes vs generic coupon codes, as well as segmentation strategies to take your eCommerce coupon marketing to the next level. Plus, we’ll discuss the importance of testing in coupon marketing and share different ways to do this.
Generic coupons vs unique coupons
A generic coupon code is one which you offer to every shopper. They’re usually made up of a word and numbers, such as SUMMER15 for a blanket 15% discount during the summer months. Unique coupon codes, on the other hand, is where each shopper receives a unique code that can only be used once.
While the generic approach might seem more appealing for simplicity’s sake, it’s worth opting for the unique approach to avoid your coupons being picked up by coupon aggregator services and spreading around the internet like wildfire.
What are coupon aggregator services?
59% of shoppers look for discount codes before making a purchase online, and these shoppers will be met with plenty of coupon aggregator websites to help them make a saving. Many shoppers also use coupon aggregator browser extensions, such as Honey, which automatically applies the best coupon code at checkout. Services like Honey typically work by scraping codes that users of the browser extension enter at the checkout of whichever stores they’ve legitimately earned or been given codes for. The coupon aggregator service then makes the codes available for other users who make a purchase at those stores, and saves them in their publicly-available database.
Of course, in some cases the generic coupon approach is a necessity, such as for podcast ads and affiliate marketing. But where possible, we recommend using unique coupon codes. Here are several specific benefits of this approach.
Benefits of unique coupon codes
1) Avoid losing revenue
Coupons are often used to entice new visitors to make a purchase or re-engage lapsed customers. But with coupon aggregator extensions, shoppers who have already made it through the funnel and would have made a purchase anyway are being given discounts at the point of conversion. In other words, you are needlessly handing out discounts to already interested customers.
What’s more, while discounts can convince otherwise prudent shoppers to spend and may help you encourage more people to make a purchase, you risk undercutting your margins, diluting brand equity and training customers to wait for a discount before buying something from your site.
2) Improve tracking and attribution
When everyone on the internet is using your generic coupon codes, it becomes virtually impossible to track campaign success. For example, if your coupon code for VIP customers becomes available on a coupon browser extension for every shopper to use, you’ll be unable to accurately measure how successful the campaign is and decide whether offering coupon codes to VIP customers is the right strategy for your business.
3) Increase your subscriber list
Giving new visitors a coupon code for signing up to your newsletter can be an effective way to boost your subscriber numbers and increase conversions. However, a generic code (such as NEW15, for example) runs the risk of being added to coupon aggregator extensions and shoppers will benefit from the discount without needing to sign-up to your emails.
4) Boost customer loyalty
Unique coupon codes that are reserved for specific segments, such as VIP customers or shoppers in a particular location, can help foster a sense of exclusivity and demonstrate that you value your customers and understand their needs.
A good coupon marketing strategy is all about targeting. Through segmentation and behavioral targeting, you can cater to each shopper’s needs rather than taking a blanket discounting approach. Here are a few ideas:
- Offer a coupon code to lapsed customers to entice them back to your site
- Send new visitors a coupon code when they sign up to your newsletter
- Give your subscribers coupon codes on their birthdays
You can also exclude certain segments from your coupon code campaigns, such as regular purchasers, and you can try different approaches depending on how visitors have come to your site, for example only showing coupon codes to paid traffic.
Testing your eCommerce coupon marketing strategy
It’s crucial to test and optimize your eCommerce coupon marketing strategy when introducing coupons to your customers, since any missteps can alienate your customers, devalue your brand, or lead to lower profit per sale.
First and foremost, you should test the effects of coupon vs no coupon, then you can move on to testing different coupon amounts and different messaging on coupons, for example making the messaging specific to the category the shopper is browsing vs more generic messaging.
You can also test different ways of delivering the coupon, for example SMS vs email.
How Fresh Relevance can help
With Fresh Relevance, you can upload unique coupon codes directly to the platform and add them to your cross-channel marketing with ease. You can target and exclude specific segments and make each coupon personalized and relevant to each individual based on most browsed, recently bought and many more shopping behaviors.
You can also test and optimize your coupon marketing within the Fresh Relevance platform. Our Auto Optimize tool is an effective way to test your discounting strategy, especially during busy, short-lived campaigns, such as Black Friday. With the tool, you can test two different discount levels and automatically implement the best performing one towards the goal you set (for example, increasing revenue). You can also do the same for testing coupon messaging.
Book a demo to learn more about how Fresh Relevance can empower you to build a revenue-driving coupon marketing strategy.