Coupon Marketing 101: How to Effectively Use Coupons in Your Marketing Strategy
Coupons drive sales. Using coupons to drive sales is one of the easiest marketing tactics that a business can execute. Coupons are quick hitting, and can have a nice positive financial impact on your business in the short-term. That said, just how big a financial impact coupons have on your business depends on a number of factors, with one of the most important being how much thinking and planning you put into making your coupon marketing strategy.
Sometimes it makes sense to use coupons to generate quick hitting upticks in sales, while other times it makes more sense to be much more strategic with how you use coupons for your business. In this article we are going to focus on the latter.
Define Your Coupon Marketing Objectives
Let’s start by defining the “Why”. Why do you want to use coupons in your marketing strategy? Is it because you have an abundance of a certain product and you need to move inventory? Are you trying to attract new customers? Do you have a new product or service you’re trying to promote? Obviously the biggest objective for using coupons is to drive sales, but before you can effectively use coupons to drive sales, you must first set your coupon marketing objectives. Answering the “why” question is a great place to start.
A few examples of coupon marketing objectives are:
- Attract 50 new customers
- Increase per unit sales of product X by 30% month-over-month
- Generate 25 new trials of our software
- Increase store revenue by 25% in the month of August
Once you have defined your coupon marketing objectives, you can build out your key performance indicators (KPIs) so that you have something to measure success against. The only way to understand how the effectiveness of your coupon marketing campaign is to set measurable (KPIs) and track campaign performance against those KPIs over time.
Coupons Are Most Effective as Part of a Larger Marketing Campaign
By answering the “Why” question above, you will begin thinking of the reasons why you want to use coupons in your marketing strategy. Start focusing in on those reasons because you can use them to start brainstorming ideas for using coupons as part of a larger marketing campaign.
We know coupons drive sales, but if we want our coupons to be most effective, treating them as a cornerstone component of a larger marketing campaign is where you want to be. A good place to start when planning your next marketing campaign is around the delivery of the coupon. For example, are you planning to send the coupon out to your target audience in order to entice them to visit your store OR are you planning to deliver coupons to shoppers in-store only after something else drove them to visit your store? If you’re using the coupon as bait to lure prospective customers to your store you can then focus on support tactics that will encourage those folks to actually use the coupon to make a purchase once they are in-store. If you’re delivering the coupon to customers only once they enter your store or land on your website, then you can focus on developing support tactics that will drive more traffic.
By developing additional tactics to surround sound your target customers, you are giving your business a better chance to generate sales. Here are a few examples of support tactics that you use as part of your coupon marketing strategy:
- Brand the campaign
- Generate local publicity
- Host a contest in your store
- Create signage or other promotional materials which support the product(s) that the coupon can be used for
Using coupons to drive sales is great, but if you want to get the most out of your next coupon marketing initiative, definitely consider that coupons are more effective as part of a larger marketing campaign. Give some thought to what other support tactics you can develop to really crank it up a notch.
3 Keys to Effectively Using Coupons in Your Marketing Strategy
When you are ready to begin planning the development of your coupon there are a few things to take into consideration to aid the effectiveness of your coupon marketing initiative. Here are 3 keys to effectively using coupons in your marketing strategy:
- Ensure coupons are relevant. Seasonal coupons are always great at generating positive ROI. Consider tying the coupon to a specific product or service that you know a large segment of your target audience strongly desires, but perhaps has been hesitant to try. Make it relevant to your targets is another way to make your coupons more effective. Generic coupons still drive sales, but it’s the details that increase effectiveness.
- Coupon tracking is critical. Going back to the top of this article where we discussed setting objectives and measurable KPIs, tracking coupon redemption is critical to being able to determine if you achieved your desired ROI for your coupon marketing initiative.
- Extend the shelf-life of your coupon marketing initiative by capturing customer data at the point-of-sale for all customers who redeem your coupon. You can then contact everyone who made a purchase with a coupon during this coupon marketing initiative encouraging them to continue to interact with your brand.
Using coupons in your marketing strategy can definitely be a winning strategy for your business, but only if your coupons are highly effective at generating sales. Take some time to think through your next coupon marketing initiative, set your objectives and KPIs, develop support components as part of a larger coupon marketing initiative, and utilize the 3 keys to making your coupons more effective. Be sure to to track your ROI by comparing your sales and coupon redemptions data to the objectives and KPIs that you set up. The results should speak for themselves.