Retail can be a highly competitive business with new products appearing every day, trying to outsell and out-maneuver competitors with marketing strategies aimed at the same target market. Retail stores have adverts in the window, loud music playing into the street and discounts and free give aways on leaflets and on the TV adverts.
Marketing is everywhere for good retail brands. There is sponsorship of sporting teams, online banners, adverts on TV and radio, newspaper full page reports on products and sales, and leaflets coming through the door. Children go to school and talk about the latest invention, dictating and craving for the latest trends. Marketing strategies aim relentless messages to their target audiences in the hope of generating the vital income to warrant the expensive marketing campaigns and manufacturing costs that it has taken to get the brand to where it is so far.
As competition increases prices can change, discounts can be offered, added extras given to people buying into the latest fashion or innovative product. Marketing companies must prove their worth and must be able to quantify their impact on the product or brand, showing that they have made the effort and increased sales by such a large percentage, that they should be given an increased budget to go again with a new campaign.
When seeking this validation, marketing companies must show that their channel is better than others and must be able to provide the evidence of success. This is one use for Promotional codes.
Offering discounts is possibly the oldest sales technique, shops do it by advertising in the window that there is 50% off their products if you buy now. With more commerce online than in stores, how do eCommerce outlets give discounts and prove that they are working? They also offer promotional codes to track their sales.
The old magazine coupons have been replaced with QR Codes, discount codes and promotional numbers, given at the checkout, to provide customers with money off products and to give marketing strategies the valuable quantifiable data that they need.
What is a Promotional Code?
To put it simply, a promotional code is a code which could be letters or numbers or a combination of both, that retailers give to customers to receive a discounted price or additional service when purchasing products online.
These alphanumeric characters can be hidden in adverts or can be blatantly in the face of the consumers to drive sales of a product, service, or brand.
They could be a part of a long-term marketing campaign, or they could be for one specific product or service to push that when it is needed. They are commonly used around Christmas time, or at the most opportune time when customers are seeking the product available. If it is a tent, they could be used throughout the summer months, if it is the latest gadget, or toy, it will be aimed at Children at Christmas.
Open or hidden?
Open codes are freely available to everyone, and commonly found online on sales platforms or websites. Anyone can find these codes and use them for discounts. These are mainly used to bring in new customers or to promote a new product.
Private codes are used to retain customers or to bring back customers who have visited your site and dropped off, or who have purchased from you in the past. These might be used on dedicated social media pages, for people who follow your brand, or are connected to your company in some way. They could be sent via email, snail mail, or given out on phone calls. They could be for loyal customers, or in a mailing campaign to bring back people who know of your service.
Hidden codes are used to offer specific discounts to a very targeted audience. If a customer is complaining a good resolution is to give them a specific code that gives discounts just to them. This way you make them feel special and resolve the complaint quickly. They could be given out at a networking event or to a secret shopper who is testing your services. These are extremely targeted, usually of high value and given in special circumstances. They are a powerful tool for boosting sales and resolving complaints.
When to use Promotional codes?
Codes to promote sales days are a common tactic to drive foot traffic to your store, and often given out on Black Friday, specific days of the month when you want a boost in sales, or on Boxing Day when people are shopping with their Christmas bonuses. They are used when people are going shopping, to make sure that the first store they go to is yours.
Shops give out gift cards, QR Codes, eVouchers, special text messages, and click here links to drive and track their sales. They can also be passed from one customer to another in the form of a gift to share the discount. This also drives affiliate traffic and tests refer-a-friend marketing strategies. With this, freelancers can join the discount trend and earn money by having their own affiliate code for the sale.
How do they work?
A customer is given a code in digital form and inputs it when they check out of the store or try to pay for their basket of goods. This increases the check out percentage and reduces dropped baskets. They might have received a push notification through the app, or an email or text message. SMS2Email provides a channel for marketing promotional codes to customers who have engaged with the brand before and who are aware of the products.
There is usually a special box on the check out page where the promotional code is inputted just before the payment is taken, and then a flash up on screen shows the discount that you have suddenly been offered. It creates a buzz with the customer and makes them feel valued that you have given them a gift.
It could be a percentage discount, or a fixed amount of money off. It is a benefit for you, the special customer. Promotional codes are not necessarily money off, they could also be offering free gifts, or an additional service that is usually paid for. Buy one, take one, get an extra night free, gift wrapping, or free express delivery, are all promotional code outcomes that benefit the customer.
When the promotional code is typed into the check out box, the discount is clearly displayed, causing a rush of happiness within the customers, and ensuring that they have a positive brand experience.
Are they a trick?
Sales mean money, repeat customers and a positive experience for you, your business, and the customer. Promotional codes can be a trick to convince customers to keep on coming back for more. You need to have regular customers since they generate more income and are generally an easier group of people to target with lower marketing costs. The business gets the sale, the customer gets the discount, the product gets more marketing and word of mouth spreads the benefits of shopping with you. Everyone wins.
Everyone loves a discount, it makes them feel special, it saves money, it means that people have more money in their pocket for the additional product that they wanted but could not afford. People who receive discount codes shop happier than those without. People search for discounts, they hunt for the vouchers and hoard them, to make sure that they get the biggest discount possible.
In gambling, the house always ins, but the discount code is the shopper’s way of turning the tables and getting free tools and products and a better shopping experience.
Loyalty is important
Loyal customers spend more money, they advertise your products on their social media and to their friends, they are more valuable to your business than one-time buyers. These reasons prove that giving loyal customers a promotional code is good for business. Big businesses offer their regular users a points-based system to give them cash back, money off or special offers to keep them coming back and to maintain their social marketing strategies.
Everyone loves being a VIP. When a customer feels special, they promote your brand to others, even just talking about it at parties or online means that they are recommending you above others, and if these people like your brand anyway, why not give them something extra to talk about? They have friends that will listen to them and will buy what they are recommended. A discount code is a way of getting that recommendation, above your competitors.
How to use them
Just because retailing Business ABC is using them, does not mean that you should, it is a choice that only you can make because it could lead to a huge discount or a loss of profits. It is a careful decision to be considered weighing up the advantages and disadvantages of the impact on your business.
Make them special
You want your discount codes to make the customers receiving them feel unique and special, so a discount coupon code like DISCOUNT123 is not unique. It can easily be shared with everyone, and it will not target those who you want to avail of your discounts and services. It is too generic and easy to share. Making the codes special, or limited, means that you can move the products that you want to move, and can also track who has the codes and where they got them from. The codes should also be linked to a mobile phone number or an email address. Linking to a second source of identifiable data means that the codes become single use, and they are available to one person at a time. You want to give discounts, but you do not want to give away the house!
Make them memorable
You want your customers to be able to remember the codes and not jump back to a different screen or to drop out of the check out process. The easier they are to be remembered, the quicker the process and the lower the drop off numbers.
Put a time limit on them
Setting a level of urgency means that customers will know that the discount is only available for a limited time and these codes need to be used within that time frame. When you are setting a time frame, be sure that it also matches up with when customers have money, like around pay days, and when they are likely to be shopping, for example, weekends. In retail, the faster you sell, the quicker you make profits and replace the stock. Giving an unlimited time allowance for the promo code means that customers will procrastinate and possibly not use them. Giving them until the 1st of the month mean that they will have money, have incentive to use the discount and you can track all the sales to the month that the promotional code was initially given. Your business will get increased sales and your customers will enjoy the increased savings available.
Make them personal
Everyone likes the personal touch. Making the discount code too personal can seem that you are using and holding their personal data, so you do not want the discount code to t=be their date of birth. Even if they are a member of your site, and you have that information, you do not want to publicize it!
Making the code personal to the individual customer makes them feel even more special and appreciated. You can send them a personal email, SMS or notification. The code in the message is just for them, if they give it to someone else to use, they should be declined, so it is truly just for that person.
First name with 10% means that John is getting 10% off their purchase, and it is only for John.
What is the purpose?
Keep the goal in mind. Is the goal to move more products, is the goal to increase your customer base, is the goal to clear the shelves of a product by a certain date, or is the goal to get more people to your store on a given date? Whatever the goal is for the promotional code, make sure that you stick to it and focus on it. Different goals are:
Boost sales – promotion codes could be for every product in your store on a certain day, this would boost sales for your business across all products.
Reduce abandonment – if people are dropping off at the checkout, a promotional code might increase the conversion of sales. Make sure that you track it to see if it works.
Promote a product – if you want to sell more of a certain brand, or a certain product, be sure to track the code to that product and to count how much of it is sold.
How to communicate them?
Are you sending the promotional codes out via SMS, email, letter, posted on your website, or hidden in communication with customers? You might be giving them out on the phone to customers complaining, this means that customers must have a pen and paper to write them down when you are giving them out. If you are using one communication channel for your codes, make sure that you track the effectiveness of that channel. Giving codes out on the phone or sending an SMS to their mobile phone are both different ways and could impact future marketing channels.
What do they look like?
Testing how to display the code will show you what works and what does not. If the code is simply letters and numbers, it might work better than if there are symbols and the letters are completely random. Having 6 letters might be easier to remember than having 10 letters and 4 numbers. Are the codes case sensitive or could they cause any confusion with the customers? If they are difficult to use, they are less effective. Plan how to display the promotional codes to customers making them easy to use.
How will you track their success?
When using promotional codes will you track the sales territory where they have been used, how much money you have given away in discounts, where they were used (online, offline, geographically), how much of different items were sold, or some other metric? How will you know that this is a good marketing tool for your business?
Will you use them?
Now that we have reviewed promotional codes in detail, is it something that you are going to use, and will you build them into your business model? They can be an impactful way to drive customers to your website or your store, but they need to be monitored and used carefully, and communicating them through the conxHub Suite of services could ensure that more customers get to know about your products and the discounts available.
