Consumers want items now and for a lower price. Promotional discounts have evolved as an efficient and durable marketing tactic for all industries — from tourism to CPG — 133 years after Coca-Cola launched the first coupon. Consumers worldwide redeemed 31 billion digital coupons in 2019. The current state of the economy and unemployment rates may hasten the growth of coupon usage.
The Power Of Digital Coupons Is Being Harnessed By Consumers
Since 2015, consumers in the United States have been progressively increasing their use of digital coupons. Consumers’ use of digital coupons climbed by 22% from 2015 to 2019. According to the Valassis Coupon Intelligence Report for 2k19, 92 percent of respondents said they used discount codes and coupons at least once in 2018.
Slickdeal, Supercouponsurveys, eBates, and RetailMeNot earned an average of 32.6 to 68.4 million monthly website views in 2019. The use of coupons isn’t anticipated to go down any time soon. According to eMarketer, the number of adults redeeming coupons in the United States might reach 145 million by 2021.
During economic downturns, both brands and consumers embrace coupon promotions
When times are tight, brands have a history of investing in coupon promotional methods. During the Great Recession, the number of coupons redeemed by Americans increased by 27% from 2008 to 2009, reaching a total of 3.3 billion. During that period, the volume of coupons distributed was large and aggressive.
Coupons, for example, can help brands connect with new customers, encourage trial, reduce cart abandonment, build brand loyalty, and stimulate positive consumer thoughts and emotions when used effectively.
Consumers generally choose brands that provide the best value for their money during economic downturns, connecting value with affordability, savings, and economizing. “Economizing will become standard procedure if the coronavirus crisis continues to roil financial markets,” said Mark Dolliver, Principal Analyst at eMarketer.
Customer Acquisition Is Influenced By Coupons And Savings Offers
Savings and discount campaigns can entice customers to explore new products and services, as well as promote enjoyment and encourage consumer reciprocity. The exhilaration of getting a discount might make you feel satisfied and accomplished.
Whether it’s a free shipping code, a “buy one, get one” discount or an offer that lowers overall transaction totals, coupons can help consumers feel like they’re getting more bang for their buck, according to eMarketer.
Consumers may choose one product or brand over another based on the availability of discounts and their impression of cost versus value. Consumers may improve their frequency of shopping and average order value per transaction as a result of the concept of saving through the usage of discounts. Incentives can be powerful motivators for purchasing decisions.
No Industry is Immune to the Desire to Save Money
Customers use coupons in a variety of industries, not only retail. In reality, consumer pricing awareness has prompted firms across nearly all industries to promote special offers, discounts, and savings. Consumers look for bargains on everything, including streaming services, plane tickets, electronics, groceries, eating, and clothes.
Even premium cosmetic firms, which were long thought to be “immune to discounting,” have witnessed an increase in customers looking for bargains when shopping. Consumers, regardless of their financial class, expect flawless shopping experiences and desire flexibility, affordability, and choice.
Marketers will continue to pay attention to Millennial and Gen Z spending and shopping behaviors. In the 2018 eMarketer Ecommerce Insights Report, more than half of the Gen Zers (over 18 years old) and Millennials surveyed said discounts and coupons were “very important” to their total shopping decisions. According to the 2k19 Valassis Coupon Intelligence Report, the number of Millennials who “always utilize coupons” increased by 42 percent from 2018 to 2019. Coupon consumers among millennial parents are particularly active. More than 90% of Millennial parents surveyed said they use social media sites, store websites, search engines, or savings blogs to find promo codes, discounts, and deals for their everyday shopping needs and desired products and services.
COVID-19 Could Act As A Catalyst For The Next Wave Of Coupon Usage
Some people’s thrifty tendencies have evolved into saving obsessions over the last decade. Extreme Couponing, a TLC show that debuted shortly after the Great Recession ended, signaled a shift in consumer culture.
Price incentives supplied by several businesses enabled higher coupon redemption during the effects of the last financial crisis from 2008 to 2011, according to retail data technology Inmar Intelligence. Consumer purchasing patterns during the coronavirus outbreak may resemble those seen during the Great Recession.
COVID-19 had an immediate impact in March and April, resulting in a decrease in physical store shopping trips and an increase in bulk buying. The usage of coupons has increased in tandem with the increase in supermarket spending. In March 2019, digital coupon redemptions were up 56.4 percent compared to the same month last year.
According to Progressive Grocer, enrollment in big supermarket retailers’ digital coupon programs recently increased by 93 percent over the previous year. “Now is not the time for CPGs and food retailers to shy away from the promotional activity,” Inmar Intelligence Director of Business Intelligence Charlie Gage said in a recent news release.
There is an even greater need to present consumers with savings choices for them to return for their critical purchases. Retailers and CPGs must engage with customers and respond to their requests for savings and digital solutions.” As long as unemployment stays around record levels, more people may be looking for methods to stretch their budgets to buy necessities like groceries.
Brands Must Be Careful Not To Undervalue Their Own Business
While coupons have the potential to increase client acquisition and retention, customers may begin to expect them if they are used frequently. Smart coupons, discounts, and promotional methods keep an eye on buyer motivation and track cart abandonment reasons.
Although discounts can drive purchases, the anticipation of a bargain can also deter customers from ever paying full price. A smart discounting technique assesses long-term consumer behavior to ensure that discounts are subsidizing the appropriate behaviors rather than discouraging purchases.
Similarly, while luxury brand discounts have grown more widespread than in the past, brands must understand why consumers prefer some brands over others. Discounts, even if they result in short-term sales gains, may have a long-term negative influence on brand impression if high prices are part of a brand’s cache.
As customers struggle to make ends meet, digital marketers have an opportunity to use creative web campaigns to provide savings opportunities. Incorporating coupons into marketing tactics for the rest of 2020 could aid digital marketers in fostering new customer interactions and strengthening brand loyalty among existing clients.
Brands that support their customers by making everyday life more affordable will most likely emerge ahead of the economic collapse. Savings incentives, in combination with flexible payment choices and frictionless omnichannel purchasing experiences, might set consumer eCommerce expectations and generate brand loyalty for years to come.