How Coupons Can Help Businesses Build Customer Loyalty
Coupons drive new business, boost existing customer engagement, and help control pricing and margins.coupons They come in the form of paper vouchers, digital codes, barcodes on smartphones, or offers stored in a customer’s account.coupons Used wisely, coupons shape pricing strategy and encourage purchase behavior without eroding value or creating the false sense of scarcity that can lead to price inflation. Used poorly, coupons train customers to wait for discounts and can compress revenue over time. Pricing and marketing teams need to work together to roll out promotions that meet the company’s goals.
The most important factor in deciding whether to use coupons is whether the discounted product can be sold for enough money to make it worthwhile.coupons Using the right tools, businesses can measure the profitability of discount offers before they deploy them. These tools include the ability to capture customer data in-store or online and the ability to automatically process a coupon at checkout.
A key advantage of coupons is the ability to inspire consumers to try products they would not otherwise have purchased.coupons They also provide a way for companies to build loyalty and reward their most valued customers. For example, a free item might convince a loyal customer to spend more at your store or to switch brands. In a recent study, over 90% of households reported using coupons.
Consumers use coupons to save money on products they need or want, but it’s not always possible to get the best deal with a coupon.coupons Many people spend hours each week combing through newspaper fliers and online sources to find the coupons that save them the most. This can be fun and rewarding, but it can also be expensive. If you spend two hours per week scouting out coupons, you may end up spending more than you planned to in order to save a few dollars.
In the digital age, consumers can access coupons through apps on their smartphone or online at websites such as Groupon and LivingSocial.coupons Digital coupons are easily redeemed at checkout and can also be shared through social media promotions, email blasts, or a company’s website.
Businesses can add more value to digital coupons by incorporating gamification techniques.coupons For example, they can set a coupon expiration date that creates urgency and challenges shoppers to act fast. They can also limit the number of eligible customers or products, which helps mitigate financial exposure while still encouraging new and existing customers to take action. Using these and other gamification techniques can turn coupons into a challenge that keeps consumers coming back to test their luck and earn rewards. The right blend of gamification and loyalty marketing can drive additional engagement without adding to the cost of your discount campaigns. This is especially true for digital coupon campaigns that offer a chance to win something of value, like a trip or a gift card, as opposed to a traditional cash discount.