Coupons are a great tool for retailers looking to increase sales, build customer loyalty, and more. Learn which type of coupon is right for your business.
When you hear the word coupon, your mind probably conjures up an image of these beauties…
…but coupons are so much more than just scraps of paper clipped from a magazine. They can be physical, digital, public, exclusive, even data driven! Coupons are a valuable tool for retailers that often go under-appreciated due to their low-budget stigmas.
We’re all about breaking stereotypes, which is why we would like to formally reintroduce you to coupons like you’ve never seen them before.
The 5 Types of Coupons Your Retail Store Needs to be Sending
When choosing a marketing tactic, you have to start by considering your goals and objectives. Choosing the type of coupon you wish to offer is no different. And before we get too far, yes, there are different types of coupons!
They’re often differentiated by details like availability, medium, value, and volume. All of which factor into the five most valuable kinds of coupons available for retailers. Which one is right for your business?
1. The Limited Time Offer Coupon
Driving sales is all about creating a manageable sense of urgency. We see this played out most commonly on infomercials: “Order now and receive this gift valued at $39.99 for FREE!”
If the added value isn’t truly tempting, this tactic can come off as tacky. However, it’s actually a scientifically proven method for influencing behavior. The Urgency Principal is one of the most powerful psychological tools used by marketers. By creating urgency (this offer is only here for a limited time) and demonstrating scarcity (only 3 items left!) you can drive sales by triggering a consumer’s need to act quickly.
The limited time offer coupon is just that, a trigger. Give your offer or discount a hard and fast timeline, whether that’s an expiration date or a window of just a few hours. This will grab customer attention and quickly call them to action.
💡SimpleTexting Tip: Windows of a few hours can be extremely effective, but you have to ensure customers view the coupon in time. Texting is a great way to make sure close to 98% of your recipients will view your offer within 5 minutes.
2. The Pre-Sale (Exclusive) Coupon
If creating urgency isn’t right for your brand, perhaps advertising exclusivity is. People appreciate being rewarded for loyalty and offering coupons to your most active demographic is a way to convey your appreciation. For some retailers, a majority of their sales come from a small percentage of regular customers. In fact, research shows that repeat customers in general spend 67% more than first-timers.
Curating a list of these VIPs and offering them deals customized to their preferences will not only help them to feel valued, it will also boost your bottom line.
💡SimpleTexting Tip: You can segment your general customer list into VIPs to ensure your offers get into the right hands.
3. Quantity Discount
Bringing it back to basics, the quantity discount is a type of coupon that grows in value along with how much a customer purchases. For example, create a coupon that kicks in only when a customer purchases three or more items.
This is the perfect discount for a retailer who is looking to move product quickly or one who is in need of making space for a new season of goods. Most commonly, the quantity discount is a way to increase sales in retail clothing stores.
💡SimpleTexting Tip: For e-commerce retailers, abandoned shopping carts are a huge hindrance on sales. Sending a quantity discount coupon via SMS is a great way to nudge customers to complete their pending purchases.
4. The Trackable Coupon
Data from your customers is valuable, and any time you can collect insights you should seize the chance. As coupons gradually shift from paper to digital, retailers can use that opportunity to collect valuable insights.
Trackable coupons can be created a few different ways. First, by creating a standalone code for multiple users. Second, by creating a unique code assigned to specific customers. Both are valuable, although the later better suited to smaller volumes (unless you want to create and track thousands of unique codes).
After sending your coupon you can collect information like redemption rates, open rates, scroll through rates and general usage. Learn what deals your customers prefer through a trackable coupon A/B test and measure your success as you go!
💡SimpleTexting Tip: With our link tracking ability, you can segment your list based on who has and hasn’t clicked on your link. This means you can turn any digital coupon link into a data-driven marketing tactic!
5. The Sign-Up Coupon
The final coupon category is the crème de la crème of customer loyalty marketing. It also happens to be the simplest and most customizable of all the options. Sign-up coupons are exactly what they sound like, a coupon based incentive for completing whatever call to action your business has.
The sign-up coupon is also a great way to jump-start a customer loyalty program. Most often, this type of discount is offered at checkout to each customer and provides instant gratification.
For example: Would you like to receive $5 off your purchase in exchange for signing up for our text marketing program?
The best part about working coupons into your marketing strategy? Multiple strategies can be utilized at once! Pairing a sign-up coupon with any of the above is a classic example. Baking couponing into your text marketing program is also a great way to get your feet wet.
But no matter what direction your retail location(s) take, know that couponing is an excellent way to grow and maintain your customer base.
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