How to Use Coupons to Promote Your Business
Coupons seem like a pretty old school piece of marketing history, don't they? I mean, it's 2014 and we are no longer that excited about things like Groupon or its many copycats (how much discounted sushi can a person eat?).
So, are coupons still a viable promotion tool for your business? Can they work, and not only this year but also going forward? Can all types of businesses use coupons? In a way, yes!
When you look at it, a coupon is nothing more (and nothing else) than a promise given to a prospective customer that when they come in, they will get your stuff cheaper than other customers.
That's the whole idea behind it.
In practice, however, the devil is in the details. And the question we should be asking here isn't if your business can offer coupons, but how to do it in a way that makes the whole project profitable from day one.
From a technical point of view, you could just join Yowza!! or try your luck with other mobile distribution networks, in order to get in front of as many people as you can. But let's actually dig deeper into the topic and focus on some things worth doing that might not be that obvious at first.
1. Make Your Coupons Specific
It's easy to fall into a trap of trying to deliver too much with just one coupon.
Granted, coupons are meant to present something special to your prospective customers, but at the same time, they shouldn't endanger your profit potential by giving out rock-bottom discounts.
This was one of the problems with Groupon back in the day. Numerous business owners were giving away coupons that were too broad and too generous, resulting in decreased profits once people started cashing them in.
Your goal as a business owner is to make money with every single coupon. So even if one day you get a hundred people trying to cash in their coupons, you should still remain profitable. You can do so by issuing coupons only for specific products, not for your whole offer across the board.
2. Award Coupons
As a web-savvy brand, you should pay attention to what people are saying about you on the web. Having some alerts set up on social media is one piece of the puzzle, but you should also examine your pingbacks – to see what people are saying on blogs and forums.
Just to give you an example, there's a company called Squarespace. A couple of months ago, I mentioned them in one of my posts. Just a friendly mention, nothing extraordinary. As a way of saying "thank you," they gave me a coupon (10% off) for their main product.
Now, I'm sure I was not the only one who was given this. But since the coupons are not advertised anywhere on their site, I figured it must be an internal policy.
Why not do something similar in your business? Just keep your finger on the pulse, and give people coupons as a way of saying thanks for their kind words.
3. Use Coupons In Person-To-Person Communication
I'm sure that email is one of your main online marketing tools. Take advantage of it!
Whenever you're having an email conversation with someone for more than two or three messages, conclude the conversation by giving the person a coupon for one of your products. The more in tune the coupon is with the topic of your conversation, the better.
This can be done when interacting with bloggers, potential partners, or even with customers asking questions about some of your offerings.
Also, it's a good idea to create coupons that are tailor-made for that specific person. For example, if the person's name is John, make the coupon code "johnsdeal" or something similar. That way, you can also track the usage of your coupons very effectively.
4. Reward New Customers
It's a lot easier to sell to someone who has already bought from you, that's a well-known fact. But this presents a whole new challenge – convincing them to come back, which isn't always as simple as it seems.
For instance, on the mobile app market, 26 percent of the time customers never give the app a second try. First impressions matter a lot! One of the best ways to convince new customers to come back is to simply give them a coupon right after they've made their first purchase.
There are loads of companies that rely almost entirely on selling to existing customers. Just looking at my coffee machine, I can name Nespresso being one of them. Their business model is to lure you in by sending you a cheap machine, and then keep selling you expensive coffee when you come back.
(Note. One more cool thing you can do – and that's straight from the Nespresso book too – is to email the person and let them know that you have a special offer for them that's only good for their second order – a "welcome back offer.")
5. Put Time Limits On Your Coupons
Limited offers are one of the most powerful marketing mind-tricks in existence. There's something about our brains that forces us to go after the things that are scarce, and that other people can't have.
So next time you're issuing a coupon, put a time limit on its use. To find the ideal time period, take a look at what's the usual number of weeks/months before customers come back to you. Then take that number, cut it in half and make it your coupon's expiration date.
The idea is that you don't want your coupon to expire too soon because people don't need your services that soon anyway. But at the same time, you don't want it to be valid for too long because after a while they would return anyway. Placing it right in the middle is the sweet spot.
What's your current strategy?
Are you using coupons in your business right now?
I know that the concept might feel intimidating at first, especially if you don't have an in-house web development team. But if you're running your checkout process on one of the more popular shopping cart solutions then you pretty much have a coupon functionality already built in there.
Your coupons could be just codes that people have to input in the checkout process or custom links that they have to visit. Either way, most shopping carts allow you to set them up in minutes.
The only thing you need to do is give this whole thing a shot. And if you're not sure if it's worth it then just release a small number of coupons to a close circle of people (the person-to-person communication approach comes in handy here).
Have you used any of the coupon strategies listed above? What have you found to be the most successful?