Penny Pinchers & Profits

• PRESENTED BY • AKISSmetrics SALE! PENNY PINCHERS a &PROFIT$ How coupons and promotions can impact your business Between June 2009 and June 2010 the savings generated from digital coupons doubled. During November 2010 alone, digital coupon traffic rose 27% year-over-year". Coupons are becoming huge. In this infographic, we're going to briefly investigate the world of coupons: how consumers interact with them and how they might impact your business. Data is for 2010, unless otherwise noted. A COUPON USAGE SNAPSHOT (U.S.) #1 $119 M amazon Digital coupon sales for the 201o holiday period (November & December) reached a combined $119 million. The Southern states led all U.S. regions in During the 2010 holiday period, Amazon.com was ranked as the most searched-for-store for digital coupons. online coupon usage. Out of the top 20 frugal cities, one-third are in the South. RECENT CH ANGES IN SHOPPING BEHAVIOR (as a percentage) People who say that they're shopping less People who say that there's been no change in their shopping habits People who say that they're shopping more Shopping less Shopping more 3rd quarter 56% 42% 3% 2009 4th quarter 2009 53% 44% 3% January 49% 47% 4% 2010 WHERE SHOPPERS LOOK FOR COUPONS NEWS 62% 31% 12% 62% of consumers say that they look for coupons in newspapers. 12% of consumers say that 31% of consumers say that they look for coupons on coupon websites. they don't use coupons. BREAKDOWN OF WHERE SHOPPERS LOOK 62% 58% 33% 32% 31% 24% 24% 18% 12% 3% 2% On-pack Retail websites I do not use Newspapers Circulars Coupon websites Brand Other Mobile phone In-store or Magazines on-shelf websites coupons REASONS VWHY SHOPPERS USE COUPONS (as a percentage) I use coupons to . I use coupons to . Save more, 75% 25% Buy more spend less Buy familiar brands Try new brands 70% 30% Buy familiar products Try new products 67% 33% Buy online 39% 61% Buy offline MOST COMPELLING ASPECTS OF A COUPON (to try a new product and switch from a preferred product or brand) %24 #2 #3 INSTANT SAVINGS THE VALUE OF THE COUPON THE COUPON HAS P.O.S. FLEXIBILITY THE COUPON CAN BE USED IMMEDIATELY Coupon value is the most motivating factor driving consumers to switch from their preferred product or brand. Consumers were also motivated to try a new product because of where/how the coupon can be used-the Point of Sale. Another reason why consumers tried a new product was that they could use the coupon instantly or on the next purchase. HOW COUPONS FIT INTO SHOPPERS' LIVES Coupons are convenient & useful Coupons take too much effort to find & use 74% 26% I actively search for coupons I use coupons when I run into them 51% 49% I decide on brand first, then look for a coupon I ind coupons first, 52% 47% then I decide on brand COUPON INFLUENCE ON CHOOSING A BRAND Consumers were asked how influential a coupon was in choosing a brand 14% 28% 44% 11% 3% EXTREMELY VERY SOMEWHAT NOT VERY NOT AT ALL INFLUENTIAL INFLUENTIAL INFLUENTIAL INFLUENTIAL INFLUENTIAL 86% 86% of consumers say that a coupon affects their decision (to varying degrees) in choosing one brand over another. HOW COUPONS CAN IMPACT YOUR BOTTOM LINE 24 #2 Consumers Who Use Coupons Can Make or Break a Sale Coupons Spend More 57% 57% of consumers who used a coupon code during their last online purchase said that if they had not received the discount, they would not have bought the item(s). 57% Consumers who use coupons spend an average of 56.5% more than consumers who did not use a coupon. #3 Coupons Can Increase Customer Satisfaction #4 Coupons Can Increase Customer Loyalty 4% When asked about their overall online 5% Consumers who used an online shopping experience, satisfaction was about 4% higher for consumers who used a coupon (92%) than for those who did not (88%). coupon said they are 91% likely to buy from the retailer again-which is about 5% higher than the likelihood of consumers who did not use an online coupon (86%). EFFECT OF PROMOTIONS ON SHOPPING CART RECOVERY Contained in a study by Seewhy.com, an analysis of abandoned shopping cart data from one of Seewhy's customers yielded some interesting results: the introduction of a promotional discount in remarketing emails caused the shopping cart recovery rate to jump from 18% to 46%-a 244% increase. Shopping cart recovery rate Original remarketing campaign 18% Remarketing campaign with promotion 44% 244% After the introduction of a promotional discount in remarketing emails, one particular company experienced a 244% increase in their shopping cart recovery rate. A WORD OF CAUTION While coupons may be great to generate a cash and encourage brand switching, they may not be a good long-term promotional strategy for some businesses. Test your market and see what works best for you. Try running promotions other than a price break-like free delivery, an extended warrantee, an upgrade, etc. Below are ways in which offering coupons could potentially interfere with a healthy promotion strategy. Tips courtesy of BlockBeta.com (@robbinblock). #2 May not be sustainable May cause revenue cannibalism Coupons may not be sustainable as a long-term promotional strategy. New customers may only be interested in your company because you ran the promotion--and not come back. If you're giving a discount to people who would buy from you at regular price anyway you're "cannibalizing" your revenue. One way to avoid this is by limiting the offer to first time buyers. #3 #4 May induce the "P.O. factor" May lessen value of product & brand image Coupons could alienate the people who aren't offered the discount. Rather than Coupons may lessen the perceived value or quality of the item being offered, especially when it comes to products or services people value based on price. Bottom line - coupons can make you look cheap. catering only to new customers, be sure to reward loyal customers as well. SOURCES: coupons.com allbusiness.com OKISSmetrics mcclatchydc.com marketingcharts.com compete.com integer.com sixrevisions.com blockbeta.com retailmenot.com * As measured by Retailmenot.com * As measured by Coupons.com PEOPLE PAY YOU. NOT PAGEVIEWS. KISSmetrics is a powerful web analytics solution that helps you make smarter business decisions. Learn more at kissmetrics.com