GUEST ARTICLE: 4 Mistakes Indian Brands Make With Promo Codes
Mumbai: Promo codes, the backbone of partner marketing, are very powerful marketing tools. When used correctly, they have the potential to attract new customers while rewarding existing customers for their loyalty. Many brands understand this – according to Coupon WhiteLabel, a company that creates coupon pages for hundreds of businesses around the world and drives traffic to them, the number of online purchases of promo codes in India in the first half of 2022 increased by more than 40 percent.
Despite this, many brands still don’t know how to properly use promotional codes. By analyzing their customer data, Coupon WhiteLabel compiled a list of the most common mistakes brands make when using promo codes and how to avoid them.
Mistake #1: Treating promotional codes as a last minute solution
Promo codes can give a last-minute sales boost for brands that want to eliminate excess inventory. But to be truly effective, promo codes must be integrated into a brand’s entire commercial and communication strategy.
Promo codes are an essential part of a healthy sales strategy, mainly because they offer real incentives to the customer at the end of the decision process. But when used correctly as part of an overall plan, they can in various ways bring in new customers, help launch new products, increase sales during a crisis, or increase visibility during a peak sales season. .
Mistake #2: Assuming promo codes work fine on their own
It is clear that promotional codes can help increase sales, but they are not miracles. Unless your brand offers really massive discounts, promo codes work best when they can be contextualized in a customer’s life. By associating your brand (and promo code discount) with a holiday, seasonal event, or trend, you can enhance your brand’s emotional connection with the customer.
Brands must constantly analyze their customers’ reasons for purchase: why do people buy our product? What holidays, seasonal events, or trends are a good match for my product? In a normal year, thousands of events can amplify the power of a promotional code. From New Year’s resolutions to spring, graduation season, festival season, wedding season, back to school, fall (pumpkin spice latte anyone?) and holidays, brands should create an event calendar that matches their product offering. and consider how these moments can fit into their overall message.
Mistake #3: Ignoring deal hunters
An estimated 35% of customers use coupons that the brand did not give them directly, but instead use promotional codes that they found by searching the internet on third-party platforms and websites. This represents a certain loss of control for you: a third of your customers may find a better deal elsewhere, be frustrated by expired promotional codes or something else that leads to a bad experience.
How can you reconnect these customers with your brand? Data from Coupon WhiteLabel shows that additional coupon sites launched by the service in conjunction with brands are helping to bring most of these customers back under brand control. This allows the brand to better manage the customer experience and refocus its attention on the desired products.
Mistake #4: Prioritizing short-term sales growth over long-term loyalty
Promo codes are a proven way to increase sales by cutting your margins a little. But if you take the time to foster a long-term emotional connection with the customer, you can reap the lasting benefits of customer loyalty.
Instead of just looking at promo codes as a way to trade some of your profit margins in exchange for increased sales, you can instead think of promo codes as a way to build customer relationships. Offering special promo codes for different groups can help your customers feel important to you. Look at your customer demographics and consider offering tailored promotional codes to different groups of your customer base. This can be particularly effective when targeting low-income groups like students, government workers, or seniors. That being said, higher income groups also appreciate a good discount, so don’t leave that out, consider tying the discount to a larger basket size instead.
In each of these cases, the promo code will be more effective when combined with a clear and well-planned communication campaign aimed at the group or groups you are targeting.
Why Promo Codes are Right for Your Indian Business
When used correctly, promo codes are a great way to drive conversion. As e-commerce explodes in the wake of the pandemic, brands in India and beyond should take a hard look at their online strategy and consider how they can make the most of their promotional codes.
The author of the article is Country Manager of Admitad India, Neha Kulwal.