Nowadays, many businesses are using coupons and promo codes to promote their products and services. However, success in coupon marketing does not come automatically. It requires application of specific strategies and tactics. The following are some tips which will help you maximize your profits.
1. Select the right products
Choose popular products which will allow you to offer a discount and still make a significant profit. However, it wouldn’t be advisable to offer discounts on your premium services or products since this might have a negative effect on your future sales. Coupons can be used most effectively when introducing new products or services, or clearing old stock.
2. Focus on the right target market
Before creating a coupon offer, you need to consider who your target market is. Don’t make the mistake of giving discounts on common products since you are only likely to attract bargain hunters. Instead, you could focus on higher margin products which are targeted at a smaller audience. In addition, you should avoid offering discounts to existing customers since this will reduce your normal sales. You can do this by mentioning that your coupons are for new customers only.
3. Capitalize on the coupon to make more sales
When someone visits your business to redeem their coupon, you can use the opportunity to make even more sales. For instance, a mobile phone dealer can offer a discount on handsets, and then encourage customers to add accessories. Or a café could offer coupons for free coffee hoping that customers will also buy pastry.
4. Minimize your losses
Offering coupons does not mean that you have to make a financial loss. Here are some of the ways in which you can minimize losses:
- Establish a minimum amount which customers should spend before redeeming coupons
- Restrict the number of coupons redeemable by households or individuals
- Limit the offer to a specific number of customers on a first-come, first-served basis
When these strategies are properly implemented, it is possible to make a profit through your coupon offer.
5. Make provision for a surge in demand
Coupon offers are likely to generate a lot of traffic within a short time, thus resulting in a sudden increase in demand. You should therefore prepare to meet this demand by having sufficient stock and staff. If your customers want to redeem their coupons but find the product out of stock, they will lose confidence in your business.
6. Track your coupons
Monitoring your redeemed coupons will enable you to find out if the offer was profitable. In addition, it will prevent coupons from being redeemed more than once. You can monitor coupons through methods such as online tracking, unique numbering and various smartphone apps.
7. Encourage repeat buying
You can encourage your coupon customers to buy again through the following strategies:
- Offer exceptional customer service
- Offer an unforgettable customer experience
- Add your customers’ email addresses to your list. This will enable you to update them on new offers
- Encourage customers to connect with you on Twitter or Facebook
- Offer different incentives for repeat buying
- Ask customers to share product reviews as well as testimonials
Do you use coupon campaigns for your business? How effective do you find this strategy? Comment below!