SOURCE: Coupon Craze

Coupon Craze

May 10, 2011 08:00 ET

The Truth Behind Coupons: What Businesses Need to Know

MIAMI, FL--(Marketwire - May 10, 2011) - According to a March 2011 report by Morpace Omnibus, 94 percent of consumers are aware of online coupons and two in three consumers use them. With the growing popularity of deal-of-the-day sites like Groupon and mainstream attention from reality TV shows, the coupon industry as a whole is showing no signs of losing steam anytime soon, according to Coupon Craze.

Until now, attention around coupons has primarily been placed around how they can help the consumer save money. However, according to online coupon code and deal site, Coupon Craze, an increasing number of merchants are actively incorporating deals and coupons into their marketing strategies. Coupon Craze founder and CEO Christian Gordun provides businesses with best practices to keep in mind when implementing a coupon strategy and dives deep into the common misconceptions of coupon usage.

Myth: Businesses lose money by providing customers with coupons

  • Reality: Coupons are an incentive tool to capture an additional part of the supply and demand curve. Although a merchant might make less money in terms of percentage of sales, coupons bring in additional business, which can result in an increase of revenue and growth. They also provide a great way for customers to be introduced and try out new products they otherwise would not have.

Myth: Customers become accustomed to using coupons and will not make purchases without a discount

  • Reality: Development of an internal strategy behind coupon implementation is essential. You want to consider elements such as rotating promotions, and tracking the results closely to adapt tactics. Additionally, it is crucial to be clear on what the promotions apply to and how long they last. Employing a combination of these tactics will help make your product and deals stickier for the consumer, and ultimately increase repeat usage.

Myth: Coupons make customers think that standard prices are too high or that discounted merchandise is of lesser quality

  • Reality: Merchants must be clear and concise with messaging around special deals. A coupon should be used to help the consumer realize that there is a great additional value during that limited time. Influential retailers should invest time in educating consumers on restrictions and coupon policy. For example, merchants are not always in control of product pricing. Retailers must abide by the Minimum Advertised Price (MAP), which is the lowest price a manufacturer will allow their product to be sold.

Myth: Providing too many coupons could devalue a store's overall image

  • Reality: Never underestimate the consumer, as customers are smart and understand value. It is important to offer a variety of deals and to appeal to different types of customers, i.e. new, returning, VIPs, etc. For example, some online vendors offer a onetime discount code for signing up for their newsletter that any customer is encouraged to use.

Myth: Deal seekers will not turn into repeat customers

  • Reality: Coupons and deals are great ways to attract new customers, but the task of retaining customers ultimately falls onto the merchant. Retailers must show additional value to the consumer by providing quality customer service, competitive pricing of products and access to tools customers value, like reviews, product suggestions and gift finders. One online shopping site, for example, has built an incredible reputation from offering tools like reviewing options, wish lists, product suggestions and gift finders which give the consumer more than one option when navigating the site.

Myth: Online coupon sites are not trustworthy

  • Reality: There is a wide array of coupon sites out there including coupon sharing sites where there is no way to control the quality and accuracy of the deals. The quickest way to check if a coupon site is reliable is to check if they are posting expired coupons. A quality coupon site works with retailers to ensure accurate and up to date listings, in turn benefiting both the consumer and business.

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"In order for deals to be successful, merchants must identify their business goals and implement a plan accordingly," says Gordun. "If a retailer's strategy is tailored, well thought out and executed correctly, online coupons are undoubtedly a powerful tool for merchants to attract new customers, engage with users and increase customer loyalty."

About Coupon Craze
Founded in 2000, Coupon Craze (www.couponcraze.com) is a free, online consumer resource that allows shoppers to take advantage of double-digit savings by providing the most reliable and up-to-date database of free coupon codes. With more than 10,000 leading online retailers and new coupon codes added daily, Coupon Craze empowers savvy, value-conscious shoppers to never leave the promo code box empty when shopping online. For merchants, offering reliable, high-quality coupon codes prevents customer disappointment and frustration that can negatively affect retail brands and lead to cart abandonment and loss of revenue. Merchants also benefit from the unique customer relationship building opportunity Coupon Craze presents -- instead of aggressive advertisements, customers are made aware of their brand through savings incentives. With the mission of connecting consumers and merchants through reliable online coupon codes, Coupon Craze has already saved consumers millions of dollars.

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