The road to retail hell might be paved with discounts, but for retailers looking to survive and thrive, deal strategy is all but required.
And it’s only likely to become more important if data indicating that consumers are increasingly searching for deals is accurate.
According to a report published by Hitwise, which we must also note is a division of Connexity, one in every 300 searches contains a bargain hunting keyword like sale, coupon, deal, rebate, bargain, discount or clearance.
Furthermore, these searches have increased by 40% in the past year alone.
Approximately 60% of these searches originate on mobile devices, evidence of the fact that mobile devices are influencing consumers’ offline shopping behavior.
Not surprisingly, many coupon-related searches are branded, a reminder to retailers that many consumers are still in play even after they walk into their stores.
Interestingly, Hitwise’s data reveals that many deal-seekers aren’t undesirables that retailers would want to shun.
60% of them are women, nearly half have a college degree, and well over a third have an annual income of $100,000 or more.
In fact, these six-figure earners are 19% more likely to search for coupon codes.
Implications for retailers
Retailers shouldn’t ignore growing consumer demand for a good deal.
As more and more consumers become more savvy and comfortable using their mobile phones, retailers that don’t respond risk losing sales to retailers that do respond.
So what can they do?
Obviously pricing strategy is key. Research suggests that younger consumers are among the most sensitive to price, and Hitwise says Gen Xers and millennials are the most likely to search for coupon codes.
Retailers should address these and other price-sensitive customers directly.
When offering deals, retailers also need to make sure that they get the most from their campaigns.
This includes ensuring that discounts are promoted properly on their websites and to customers via targeted emails. Retailers should also ensure that they’re not overlooking affiliate channels and third-party services that aggregate coupon codes.
The good news is that with smart strategy and good execution, retailers can not only please the bargain hunters in their existing customer ranks, but possibly also drive new customer acquisition.
According to Hitwise, those who search for coupon codes are 19% more likely to shop at a store they don’t frequent based on a sale, and they’re 23% more likely than average to identify themselves as a source of purchasing advice to the people around them.