Using Coupons Effectively For Your Small Business
Most shoppers are always on the lookout to save a dollar. As a small business owner of a retail store, one of the most effective ways to engage with value-oriented customers is by issuing coupons.
For their ability to bring in business, coupons have achieved wide reaching popularity among marketers. This popularity, in turn, comes from consumers’ broad acceptance of coupons. Advertising Age reports that 87% of all shoppers use coupons, while A.C. Nielson Co. has determined that 95% of consumers like coupons, and 60% actively seek them out.
So, how can a small business use coupons to drive higher profit? There are many ideas to start with.
Using coupons is a great way to get customers through the door in the first place.
A good coupon can bring customers in from further away, effectively expanding your market area. Given a valuable coupon, customers who have frequented your competitors can be lured to making their first purchase at your store, and customers you’ve lost to competitors can be brought back.
Also, some business owners tend to forget that coupons provide an opportunity for additional sales, both of goods related to the coupon item, and general impulse purchases. There’s also the opportunity of upselling to a more expensive product, which would not have been possible if the customer hadn’t come in with a coupon in the first place.
Finally, coupon promotions are easily tracked, and measuring their impact is as simple as adding up how many have been redeemed.
When planning a coupon promotion, a business owner will inevitably reach the point where they must make a decision between simple printed coupons, and the more technical digital kind.
In the modern retail environment, one might assume that digital coupons, downloaded onto smartphones and tablets, would play a major role. However, print coupons as found in newspapers and circulars, still dominate the space.
Consumer product companies issue around 30 billion coupons a month. Off all issued coupons, only a tiny amount, less than 1%, are digital.
All those printed coupons might seem like a waste, especially considering that less than 1% of them are redeemed, but there are good reasons that companies still turn to print.
For one, the cost from publishers to include and distribute printed coupons is typically a fraction of a cent, while digital coupons can cost five to ten cents per download. On top of this, the retailer must have hardware to scan digital coupons.
For now, digital coupons simply represent too much of an expense for typical businesses.
Paper coupons are efficient and broad scale. A large company can reach millions of households any given day with a printed coupon promotion.
The print demographic is aging, however. According to the latest data from the Newspaper Association of America, the median age of a mobile news user is now 17 years younger than the typical print reader.
The day will probably come when digital coupons dominate the industry. But for now, old fashioned printed coupons reign supreme.