Retail and Discounts - Building Business Sales

Retail and Discounts - Building Business Sales The stats behind coupon marketing campaigns SALE THE HISTORY OF COUPONS The word "coupon" is derived from the French "couper" which means "to cut" COUPON TIMELINE The first coupon was a hand written ticket offering the bearer a free glass of Coca-Cola. The coupons were mailed to homes across the country, handed out on the street by Coca-Cola salesmen, and placed inside magazines. The first official coupon campaign was a success! Between 1894-1913, more than 8.5 million coupons were redeemed at soda fountains 1887 8.5 MILLION 1894 nationwide and Coca-Cola-and the word "coupon"-become a household name. 1909 It wasn't until 1909 that the second coupon was distributed for Grape Nuts cereal - the grocery coupon was born. The post-depression and the war years in the 30s and 40s saw a dramatic increase in the use of coupons for savings and rationing. 1930 With the development of the internet in the 90s, coupons went digital and became even more widely used. voucher code The US celebrated its first ever National 1990 Coupon Month. SEP 1997 COUPON SUCCESS STORIES McDonald's Coupon type: Collect stamps for every purchase to qualify for a free product They found a way to get customers to spend more just for a chance at the big prize McDonald's discovered that by offering games pieces on their large and super-sized value meals they could sell double what they would without it. This strategy has proven to be successful for years. $4- $5 $7-$8 value meal Large value meal game piece Orange Coupon type: Two for One They made the least popular day at the cinema profitable with a Two for One deal FILM The Orange Wednesdays campaign started in 2004 and is still running today. Historically, a Wednesday was the least popular day for the cinema in the UK, but all that has changed since they launched their offer. Customers text the word FILM £15 MILLION 300,000 coupons a week which equates to about £15 million Orange issued over 300,000 that gives them two tickets for the price of one at their nearest cinema redeemable on a Wednesday receive a message back with a coupon code per annum coupons a week COUPON FAILURE Blockbuster Coupon type: Discounts They tried a "No Late Fee" offer but customers kept the DVD's In an effort to compete with Netflix, Blockbuster started a 'No Late Fee' offer which lead to customers simply keeping DVDS as if they owned them. This offer could not compete against Netflix. They needed to do more and develop their service instead. The offer was useless and caused yet more damage to business. Back story Over a decade ago, Blockbuster ruled the film and game rental market, valued at $3 billion US dollars. They decided not to purchase Netflix when it launched in 1997 as they were small and only offered DVD films via post, which was no competition at the time to the already established giants such as Blockbuster. Netflix then developed their streaming service which changed the whole industry. COUPON VARIETIES COUPON TYPES • Discounts - £/$ off or % off a qualifying product or for a minimum spend • Free shipping • Buy one Get one Free / Two for One / LOYALTY CARD TYPES 241 / BOGOF • Two for the price of three (cheapest one free) • Additional loyalty card rewards points for minimum spend • First time buyer offer • Additional loyalty card rewards points for a specific item purchase • Free trial offer CASE STUDY • Gift with purchase Boots Advantage Card Coupons now have a longer • Collect stamps for every purchase to qualify for a free product expiration date of up to 3 months because customer's said they didn't have time to use them. Listening to customers is important. 25% OFF 8042561382 Cut out Coupons and Free Standing Inserts Internet coupons and Voucher Codes Mobile coupons Often found in magazines and newspapers, or via postal marketing. These coupons usually operate using barcodes or they provide consumers with a discount code to use A mobile coupon is essentially an electronic coupon or a paperless ticket that Offered to consumers via social media, email, voucher distribution websites, they often require the consumer to type a code into an e-commerce discount code box within the checkout which can be both searched for and then delivered to consumers using a online. will then apply the discount. mobile device. LAUNCHING SUCCESSFUL COUPON CAMPAIGNS DEALS AMOUNT CONSUMERS CONSIDER $55 $5 OFF OFF 43% discounts of 25% or less to be a "good deal" 31% of coupon users are most interested in deals that offer a specific dollar/pound amount off of their purchase FEATURES The best coupons have... WHY? Discounts on the products they like and would be buying anyway Some % off deals can be difficult to calculate. A specific amount off is clearer for consumers Discounts that are substantial Consumers are least interested in coupons which offer free shipping enough to justify the time required for clipping them CONSUMER REACTION TO COUPON CAMPAIGNS Coupon Users 79.8% 53.7% of consumers say they now focus more on needs than wants when purchases are concerned. of consumers use coupons with regularity 92% 80% are value-seeking shoppers, self-described as 'promotion sensitive' of consumers used coupons in 2013 2007 = 63.6% 02 00 00 91% 57% of coupon redeemers say they will visit a retailer again after being offered a coupon of shoppers say they would not have made a purchase hours spent per week for 62% of consumers searching for deals and special offers. without a coupon first GENDER USING COUPONS AGE GROUPS USING COUPONS 15-17 2% 18-25 |26% 26-30 20% 31-40 26% 41-60 23% 47% 60+ 3% USE COUPONS FOR: 18-34 35+ apparel/shoes/accessories 33% 17% electronics 23% 10% NCH'S 2012 COUPONS INFLUENCED: CONSUMER SURVEY SOMETIMES VERY OFTEN IALMAYS trial of new product 42.9% 17.5% |10.4% selections of a brand typically not purchased 97.2% compared prices between brands 12.8% 5.8% selections within accepted set of established brands 42.4% 25.1% 84.1% 7.8% switched stores to take advantage of weekly specials. product is purchased only with coupon 36.9% 10.9% 3.4% REASONS CONSUMERS MIGHT NOT UTILIZE COUPONS: "I can't find coupons for the products I want to buy" 46% 25% OFF "Coupons expire before I have had the chance to use them" 39.1% "I don't have time to clip coupons" 30.7% "Coupons require me to buy too much to get savings" 19.5% "I am buying more store brand products" | 19.4% BRAND BENEFITS FOR OFFERING COUPON PROMOTIONS Brand Benefits Encourage Promote a new product Attract Trial a new customers to return new customers product $5 OFF Feedback in order to target marketing Goodwill, customer loyalty, customer retention PROS CONS Coupons should not just be used as a short term solution • Can entice price sensitive consumers • Easy to track • Easy to implement to attract new customers. This • Can reduce average order value will lead you to attracting • Increase sales • Can encourage disloyal price sensitive customers who customers will move on to your competitors once the promotion is over SOCIAL MEDIA COUPON PROMOTION SOCIAL MEDIA COUPON CAMPAIGNS CAN: DRIVE IN-STORE PRODUCT TRIAL qID GENERATE "BUZZ" START CONVERSATIONS share BUILD A FAN BASE REWARD ENGAGEMENT 66 SOCIAL MEDIA AND COUPONS % OF CONSUMERS will share deals via social media platforms 28% Brands should use social media channels as well as other marketing techniques to advertise coupon campaigns. Email marketing, FSI, will 'like' a Facebook page to obtain a 25% or more saving from a brand 67% will Tweet or Retweet a deal to save 25% or more from a brand 17% promotion on voucher site AND social media promotion combined will lead to more chance of success. searched online for a coupon after hearing about it on social media 71% used a coupon they have found on social media 54% -PHIL FROST, Main Street ROI BEST POSTING TIMES Facebook Twitter BEST DAY: BEST DAY: SMTWTFS SMTWTFS engagement is 32% higher on weekends BEST TIME OF DAY: BEST TIME OF DAY: 6AM 12PM 7PM 12PM 6PM Be aware of different time zones when posting social media content. ONLINE VOUCHER CODES ONLINE COUPON USE 2013 2010 66 29% 16% MILLION parents 35% adults without children 26% digital coupons were redeemed industry- wide in 2013 MOBILE COUPON USAGE I2013 2010 Coupon codes are an excellent way to track and measure your advertising ROI. Simply use a different code for each ad outlet (i.e. Googlevs. Bing vs. Facebook) so you can see exactly how many sales each campaign generated. With a little bit of tech work, you can also use coupon codes to track- down to the keyword level of your search ad campaigns - which is critical for optimization. Ages 18- 34 18% Ages 35+ -PHIL FROST, Main Street ROI Online Voucher codes often finalize the decision for me if I am undecided on a purchase: IAGREE / LIKELY I DISAGREE / NOT LIKELY 65% 10% How likely would you be to reconsider purchasing a product you put in your online shopping basket, but did not buy, if you received an online voucher code? 63% MOST POPULAR COUPON SEARCHES HOW ARE CONSUMERS FINDING COUPON DEALS? 14% 96% 21% 92% 91% Home 53% improv. Electronics 85% Groceries 68% 38% 25% Clothing Personal Care/Hygiene Products 22% ENTMT. 14% Services 36% 17% Dining Household Items 22% Pet Social Media Brand websites EMAIL COUPON PROMOTION PERCENT OF COUPON USERS THAT ARE VERY LIKELY TO USE COUPONSs OR DISCOUNTS THEY RECEIVE VIA EMAIL 93% women 95% men 89% are very likely to use coupons they receive via email parents 96% adults without children 91% urban 89% town/rural 95% suburban 94% BEST TIME TO EMAIL A 2012 Experian email marketing benchmark study across all industries found: The 'best' time and day to mail varies by industry, however, across all brands and industries: BEST DAY: BEST TIME OF DAY: SMTWTFS 8PM 12PM 4AM highest revenue per mail EMAIL OPEN RATES 21.7% 8pm to 11:59pm highest click rate 17.6% 12am to 4am had the highest open, unique clicks, transaction rates and revenue per email, yet had the lowest volume deployed compared to other days of the week. Deploying emails between 8:00 PM and 11:59 PM and midnight to 4:00 AM proved to have the highest response rates in all areas, yet also had the lowest percent of email volume. Test sending out emails at different times to see what leads to the most engagement for your brand. Once you find your optimal engagement times, email coupon campaign success will increase 40% 7 in 10 82% of consumers share people say they made use of a coupon or discount from a marketing email within the last week. of consumers open emails from companies email deals via email to their friends COUPON SUCCESS STORIES GAP Coupon type: Discounts They made 11 million US Dollars in one day using a 50% off coupon for back-to-school Part of their success was due to their multi channel promotion technique to launch the campaign. It was a big deal, therefore it spread via social media and via word of mouth. $25 = $50 Their email marketing in particular was a success, the company used a comprehensive email database to send out information on the deal. Consumers had to purchase a $25 coupon in order to spend $50 on Gap merchandise. deal! Consumers were notified through social media, email marketing and promotional voucher sites simultaneously. One email was sent out at midnight, ensuring users saw the email first thing in the morning, with about 15 million recipients receiving the $25 OFF message. ADDITIONAL COUPON TIPS WILL A COUPON CAMPAIGN SUIT THE NATURE OF YOUR BUSINESS? GOOD MATCHES ARE: Coupons work best for location-based, product- • restaurants • hair salons • hotels oriented businesseswhere * spas • pet grooming • yoga studios local customers can realize quick and easy savings. CAN YOU MEET DEMAND? Can your business scale up to meet the potential demand surge the coupons may trigger? Whether you operate online or as a bricks and mortar business, it's important that your business is prepared to handle excess sales and that the stock is in place. Letting down customers will only lead to poor customer relations and ruin the whole coupon campaign. $25 orr $25 OFF CAN YOU AFFORD THE DISCOUNT? Make sure you can afford the discount for the duration of its Do you have enough profitable business coming periods to overcome the costs of offering a discount or special offer? oth line time validity. Weigh your long-term goals and how coupons can benefit them. Is your discount rate enticing for customers $10.00 cost yet covers costs? -$8.00 discount $2.00 profit SOURCES http://happymoneysaver.com/ http://www.billhalal.com/ http://business.time.com/ http://www.bizreport.com/ http://www.businesswire.com/ https://www.inmar.com Valassis 2K12 Shopping Marketing Report http://online.wsj.com nttp:. 2012 Experianemail marketing benchmark study RedPlum Purse String Survey https://blog.compete.com/ http://www.nchmarketing.com/ http://www.investopedia.com/ http://www.gametheorystrategies.com/ http://www.practicalecommerce.com/ https://www.inmar.com/ http://blog.kissmetrics.com/ http://blog.funmobility.com/ http://www.sba.gov/ http://uk.couponsinc.com/ CC vouchercloud BY ND Live more. Spend less. GAME CARD UB CARD CLUB CARD $ 15 Coupon website Retailer Websites Search Engines