Coupon promotions are one of the most effective ways to advertise your retail store and help it grow. On the one hand, coupons can be an especially effective way to attract shoppers. According to the
Promotion Marketing Association (PMA), 94 percent of shoppers used coupons in the past year, with many of them planning their shopping around coupons. Furthermore, coupons can be a particularly useful sales driver in a weak economy, as evidenced by a 20 percent increase in coupon use over the first half of 2009, according to the PMA.
Even though many small retailers recognize the value of coupon promotions, creating a coupon campaign can be complicated. First of all, a coupon offer must be compelling enough to tempt customers, but sensible enough to let you afford the discount you promise. You must also protect yourself with a clear and simple offer that cannot be misconstrued or abused. Each coupon should therefore include an expiration date, relevant legal copy and any exceptions and limitations.
If it is constructed well, an effective coupon campaign will not only increase sales and attract new customers, but also gather business intelligence about shoppers, which can help inform your business decisions. In order to capture this data, make sure your coupons can be tracked — either manually or through bar codes — to provide non-intrusive information on buying habits.
Before you select the most effective promotional coupon campaign for your business, consider the various distribution methods available:
Online coupon codes
The Internet has made it simple to disseminate and share promotional offers. If you want to increase online sales, find out if your Web host or e-commerce software can accept coupon codes. If it can, there are many easy ways to distribute a promo code and attract clients. You can “tweet” a code to your Twitter followers, or add it to Coupon Tweet or twtQpon.com, two Twitter tools aimed at publicizing discounts. Alternatively, you can e-mail the code to your customer database or list it on a coupon search engine, such as RetailMeNot.com or Coupon Saver.
But be cautious about handing out coupon codes online unless you are prepared for them to go viral. When a great retail deal is spotted online, it often gets posted on popular forums such as FatWallet or Slickdeals, which can cause an unexpected volume of new orders that you may not be able to fulfill, leading to dissatisfied customers.
Newspaper coupons
Although online coupons are the easiest to distribute and are often used by younger, computer savvy shoppers, newspaper coupons are still effective. According to the PMA, nearly 90 percent of all manufacturers’ coupons issued in the U.S. are delivered through the local newspaper or delivered with local retailers' circulars. If you can’t afford the cost of distribution through the Sunday insert of a major regional newspaper, there are cheaper alternatives such as advertising online through CouponGenie.net or in the local paper and using the ad to provide a coupon.
Think beyond the paper
Newspaper advertising is just the tip of the iceberg when it comes to paper coupons. Other options include posting a printable coupon on your Web site or as mentioned before CouponGenie.net offers this service for businesses or listing it for free in your area’s annual Entertainment Book, which makes its money by charging for the book rather than making advertisers foot the bill.
Direct mail campaigns are another route for retailers, but these often require a financial commitment in order to produce results. It costs just pennies to send each coupon, but that amounts to $500 to $1,000 per month if you’re sending tens of thousands of mailers. Advertisers recognize that “shared mail” or “cooperative direct mail,” like Valpak and RedPlum, often gets thrown away without being seen. Consistency is key with mailers; you must constantly saturate your market area with the mailers in order to get through to your customer base.
Bounce-back campaigns
A bounce-back coupon is one that encourages a customer to return to your store at a later date. You might, for instance, have your sales staff roam the store offering a future sales discount in exchange for an e-mail or mailing address. This way, you might get an immediate sale from shoppers in your store and you’ll be more likely to receive a second visit once you send a coupon.
Bounce-back promotions can be instituted in-store or online. It’s common practice to ask online buyers at the checkout whether you can e-mail them special promotions. This allows you to establish a loyal customer base that keeps your business profitable.
Brian Luskey is an associate editor at Business.com, the web's largest business-to-business searchable directory and home to more than 35,000 business how-to guides.
Find compensation design and planning solutions at Business.com, the internet’s largest business-to-business website. Business.com helps businesses reach 40+ million users monthly online and is home to more than 35,000 how-to guides that help business owners solve problems and realize opportunities.
Copyright © 2009 Business.com, Inc. All Rights Reserved.
