How To Increase Revenue With Coupons
In their article, The Coupon Comeback, Nielsen states:
“Once on their way to extinction, coupons made a strong resurgence in 2009. While they offer consumers a chance to stretch their dollars further, they also offer real growth opportunities for retailers and manufacturers—if they know exactly who to target and how to leverage established and emerging coupon delivery vehicles.”
Indeed, in the last few years, coupons have made a name for themselves as highly effective sales tools for every type of business. As Vaucher points out, “Providing coupons to customers can lead to several benefits for business.”
Let’s take a look at 4 ways coupons can increase your revenue and boost business growth:
#1: Attract More Customers
In general, people prefer buying things on sale. That’s why offering coupon discounts is an effective way of attracting more people to your store.
According to Convince & Convert, about 93% of shoppers use coupons or discount codes throughout the Year. This means that a vast majority of consumers out there are searching out good deals and if you’re offering discounts, you’re going to attract those coupon-seeking consumers.
Coupons can also help you expand and increase your market area, because studies show that consumers will travel further to redeem valuable coupons. Additionally, coupons attract new consumers who are actively in the market for particular products and services. In fact, 30% of people purchase to gain something and 70% purchase to solve a problem. People want to believe that their purchases will help them in some way, whether it’s saving them time or simplifying a task.
Offering discounts will help you lure new customers away from your competitors as well. That’s the word from Convince & Convert, who points out that consumers will break routine shopping patterns to take advantage of a good coupon offer.
Finally, don’t underestimate the value of using coupons at the customer acquisition stage to acquire customer data (like phone numbers, email addresses, locations etc.) and build a database of customers interested in coupons, deals and discounts. Coupons will also help you lure back customers who have crossed over to the competition, offering them a compelling incentive to buy from you again.
As you can see, coupon marketing can be a very effective method of attracting new customers who will boost your sales.
#2: Move More Products
Consumers love a good bargain, so using coupons can be an effective way of moving seasonal or obsolete inventory items when you need to get rid of them to make room for new products. To catch every customer’s eye, suggests Chron, move discounted products to the front of the store.
Coupon advertising also opens the door to additional profits through sales of related items. Because discounts attract more people, you’re increasing potential buyers for other items in your store (most people will look around to see what else you have to offer before making a purchase). For instance, if your clothing store discounts all jeans in stock, people will come in to not only take advantage of the jeans discount, but to browse other clothing items or accessories, such as jackets, shirts, and belts.
Another way coupons can help you sell more products is by offering bundled deals. In fact, according to one study, you can sell up to 73% more product by offering bonus packs. Consumers tend to gravitate to bundled deals because they typically seek quantity. This means increased sales transactions for you.
#3: Cultivate Customer Loyalty
Businesses crave loyal customers. After all, from a business owner’s point of view, loyal, repeat customers provide a constant source of revenue.
But customers aren’t born loyal. They become loyal when companies do something to earn their continued business. For example, a company might use coupons to thank customers for shopping with them and encourage them to make another purchase.
“One of the biggest reasons that coupons are such a success is their ability to spread brand awareness,” says Mandlik & Rhodes.”People tend to trust the names of companies they recognize, which makes this a very effective facet of marketing.”.
The more people see and redeem your coupons, the more they will come to know and trust your brand. And the more likely they will be to remain loyal customers.
#4: Take Advantage of Easy Distribution
While Nielsen indicates that newspaper inserts are still the primary method of coupon distribution (89%) and redemption (53%), the growth of coupon redemption on the Internet has skyrocketed as much as 263% since 2009.
Today, retailers can get coupons into the hands of consumers by such methods as printable coupons on the Internet, and in-store kiosks and discounts linked to frequent shopper cards via smartphones and computers. To put it simply, it’s easier than ever to distribute and use coupons. For example, you can share coupons with consumers via social media, customer receipts, your company blog, newsletters, email marketing messages, SMS messaging, and so much more.
A recent study by Statista indicated that the number of US adults redeeming digital coupons would increase to 126.9 million in 2016. No doubt that number has experienced an upward swell in 2017. But though we currently live in a digital era, studies show that print coupons can be just as effective at marketing your brand as digital ones. So don’t rule them out if you’ve got the funds for printed coupons in your marketing budget.
These days, innovative software, like Rain POS, allows you to send Bring ’em back, Birthday, and Bounce-back coupons through automated emails, saving you time and money. With advancements in coupon delivery methods providing increasingly-targeted distribution (and redemption), coupon marketing will continue to help retailers, like you, drive sales and boost business growth for years to come.
“Discounts drive marketing,” says Nielsen, “so it’s imperative that you properly utilize them to gain the most from your sales efforts.” Keep in mind, though, that if you offer discounts too often, it will be difficult for you to ditch your brand’s reputation for markdowns.
“Be strategic about offering discounts and consistently re-evaluate your marketing plan – and your sales team will be more likely to succeed.”
Also published on Medium.