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Coupon codes and your ecommerce website

Published August 24th, 2011 in Better Business, Online Marketing | Comments Off on Coupon codes and your ecommerce website

If you’ve done any online shopping yourself you’re probably well aware of coupon codes. These are codes that can get you spiffy discounts on whatever you’re purchasing. A simple internet search for the company you’re purchasing from can usually result in a number of listings of sites where people post these codes for others to use. If you run an ecommerce site and you’re unaware of this, then you’ve got a little catching up to do.

Extreme Couponing … on the web.

Unlike the now popular tv show, online businesses are usually spared the customer who manages to get their shopping total close to zero with dozens of different coupons. I have not actually seen a shopping cart that allowed a customer to enter more than one coupon code and the only way to receive an additional discount is if the shop owner creates a special that is applied to some or all products or on the shipping (ex: “10% off blue widgets until September 1st!” or, “Free shipping on orders over $25!”).

Consumer focused.

Websites that act as “databases” (and sometimes touting themselves as, “communities”) for just about every coupon code available are certainly more geared towards the customer than the business owner. Some I may even go so far as saying are a tad bit nefarious (wanting you to “sign up”, then spamming the heck out of you or worse – so as a consumer, if you do use them, use the ones where the code is shown without any sign up). There are a few top sites however where valid coupons can be found. But these sites usually rely on user submissions or other, “gathering” techniques that do not keep a business owner in mind. For instance, a business runs a special promotion for readers of a specific magazine. The coupon code for that special promotion ends up on one of these sites and tons more people, who are not readers of that magazine start using the code.

For business owners, the whole point of putting out a coupon code is to bring in more (and new) business. So the fact these codes end up on those websites should neither shock nor highly concern business owners. You could land yourself some new customers, even if they do start out with a discount. If they’re happy with your product, there’s a chance they’ll be back (and probably looking for the next coupon code, but hey, it’s still sales, right?). If you are worried about thousands of people using your coupon code until the end of time, I highly recommend setting an expiration date in your shopping cart software. Some shopping carts also give you the ability to set a number of uses for a single code or are sophisticated enough to track customer’s IP addresses or other identification when redeeming coupon codes, allowing only 1 redemption per customer.

The dangling carrot.

Coupons are certainly meant as an enticement but how much enticement is enough in today’s world? There are basically 3 approaches to discounts: (1) a percentage off, (2) a dollar amount off, and (3) an additional perk with purchase (ex: “buy 1 get 1 free”, “free shipping”, etc.). There are also variables that can be added on the type of discount you choose such as, “new customers only”. It can be hard to judge how much of a discount is enough to attract people, without it hurting your bottom line. What I would recommend is checking out any competitors you might have to see what they’re doing, or use your own experience as a consumer online and any discounts you might have scored as a starting point. However, don’t get caught up in that, “race to the bottom” mentality where you’re trying to keep up with large competitors with massive discounts (or the type of discounts you see on a site like Groupon). Make sure any purchasing scenario does not eat away at your actual profits.

The wrap up.

So is putting a coupon code out there good for your ecommerce business? Basically, yes. As long as you’re smart about the type and amount of discount as well as protecting yourself from overuse if it does end up on a coupon code site, then there really isn’t any detriment to your business. It’s a valid form of marketing and it’s a way to reach people you might not have otherwise.


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Sherry Holub

Sherry Holub

Creative Director at JVM Design
Choosing design as a profession was easy with a heavy background in creative pursuits and an art degree, but Sherry's also been a writer for many years and has had works published in print as well as online. Besides art and design, Sherry also likes comic books, owls, kitsch, muscle cars, sci-fi, archaeology, rabbits, photography, natural health, octopuses, qi gong, the ocean, cats, and many other fun things.