22 Aug 2023

5 reasons your business needs coupons

Talon.One Writer

Content Team


4 minutes to read

Why should you use coupons? Because they are a great strategy for increasing conversions, acquiring new customers and rewarding loyal customers.

According to eMarketer's ecommerce statistics report, more than 70% of US internet users said their purchases were influenced by coupons and discounts.

You've probably created a coupon campaign already, but maybe you're worried about loss of revenue, how to securely validate coupon codes, fraud or having the right solution in place to support your campaign.

However, when executed correctly, coupons can be incredibly beneficial for your business, increase profits, increase customer engagement and reduce customer acquisition costs.

Here are 5 reasons you should implement coupons in your promotion marketing strategy.

1. You'll drive traffic to your website


Idea: Run a coupon campaign valid for 10% off all orders on your site for purchases made in the next 72hrs.

96% of consumers would still use coupons even after winning the lottery.
-Red Plum

Why: Both new and existing customers will have a compelling reason to visit your site to browse products and redeem their coupon. Increase the sense of urgency to discover your site and buy products by adding a time limit to the campaign.

How: Promote your coupon effectively to ensure wider campaign reach. Target a large segment of your audience with the code in an email, promote on social media and consider a paid Facebook promotion to acquire new customers.

Remember: Ensure your website can handle the spike in traffic, that all coupons can be securely validated within a short time frame and the coupon itself has an expiry date.

2. You can increase product sales

Idea: Send new customers a 5€ coupon code when they sign up for your newsletter, to use for their first purchase. Set a minimum order value to increase the average spend and increase product sales.

57.4% of consumers claim they are more likely to buy a product from a retailer's site when the retailer emails them a discount code.
-Cue Connect

Why: Reward customers for signing up to your newsletter and encourage a first purchase with a valuable offer. Once they have stepped into the sales funnel, they are more likely to make a second purchase and see the value in opening brand communications like newsletters, sale alerts and contests.

Tactics: Create a positive customer experience from day one and reward them for opting in for communications. Suggest other relevant products based on their cart items to help them reach the minimum order value.

Remember: Analyze customer data to see what products are most relevant to customers, the optimal time to send communications and what customer segments should actually receive offers (not every customer needs encouragement).

3. Promote new products

Idea: Give your active customers access to your latest products or services before anyone else and a coupon code for 50% off, valid only for the new item. Ask for a product review or rating after a successful purchase.

47% will sometimes try a new product after receiving a coupon/discount offer while 23% said they "almost always" will.

Why: People are more likely to purchase a new product if it feels like an exclusive offer and they'll be able to have it before anyone else. This will positively impact sales, product awareness, and assuming product reviews are good, build positive brand awareness.

Tactics: Leverage customer data to achieve the highest level of personalization for these customers. Be sure your new product is ready, in-stock and has all the features you say it does. Target people who trust your brand already so they will be excited (not apprehensive) about trying something new.

Remember: Don't forget to ask customers for a product rating or review. Include a social sharing element to expand campaign reach.

4. You can reward loyal customers


Idea: For customers who make regular and high-value purchases like plane tickets, reward them with 50€ coupon to be used for a hotel or tourist attraction.

Existing customers are 50% more likely to try new products and spend 31% more than new customers.

Why: Customers who are loyal to your brand should be rewarded for their good behaviour, and if you deliver an exceptional experience, they will return the favour by making purchases or recommending your brand to their friends.

Tactics: Send the coupon code via email once they have made a minimum number of purchases on your website. Leverage your customer data to reward them with a highly personalized offer that recognizes their unique behaviour and preferences, like a family-friendly hotel or luxury spa.

Remember: It costs 5 times as much to acquire a new customer as it does to retain an existing one (Invesp), so it's worth investing in building this relationship.

5. You get customers to come back (and convert)

Idea: Send a “Welcome Back!” coupon code to inactive customers. Offer a very valuable reward like a free 3-month subscription to your service if they use the code in the next 24 hours.

Why: There are numerous reasons customers might stop interacting with your service, but that does not mean you should give up on them. A re-engagement email with a compelling incentive might be just the trick to get them interacting with your brand again.

Tactics: Give customers a chance to experience your service for free, or at a heavy discount and show them what they have been missing. Highlight products they might enjoy, communicate the improvements made and features you have added since they have "been away".

Remember: Analyze customer data to determine what customers are worth targeting. You don’t want to give free subscriptions to customers who have only been inactive for a few days (but this definition is up to you).

What are you waiting for?

Coupons are a great way to drive traffic to your site, increase product purchases, drive product awareness, reward loyal customers and re-engage with customers.

Now that you know the benefits of sending coupons to your customers, always keep the following in mind to ensure the success of your campaign:

  • Define target audience and promotion channels

  • Create compelling creative and clear calls to action

  • Determine a timeframe (start and end date)

  • Ensure codes can be validated efficiently

  • Prepare for increased traffic and product orders

  • Set campaign goals, measure and track results

Check out our report, "Campaign ideas for your online promotions" to discover different ways to get creative with your promotion campaigns.

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Isabelle Watson

Loyalty & promotion expert at Talon.One

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