That guy you stand behind at the supermarket checkout, while he clumsily thumbs through endless loose vouchers and causes a tailback four trolleys long at 11:30pm… that’s me.

That party of four, sat at the table of a popular pizza chain restaurant scrolling up and down their smartphones trying to find an online voucher for 50% off while the waiter patiently awaits our order… that’s my party of four.

I owe you all a giant apology. However it definitely looks like I’m not on my own. In fact four out of five UK adults have used a discount or voucher code in the last 12 months (both online and offline).

This is according to research carried out by Browser Media. Here we’ll be taking a look at the study along with offering our own advice for how retailers should use vouchers codes.

Social taboo?

I wasn’t aware that the regular use of vouchers was necessarily a social taboo, however 41% of people in the study believe that voucher codes and discounts have become much more socially acceptable than they were before.

Were we afraid of people assuming that we’re in financial difficulty or somewhat miserly if we were seen to present a discount coupon at store checkout? There’s pride and then there’s common sense, and the latter should always prevail.

It actually turns out that households with a middle income of between £28-£41k are the most frequent users of vouchers and discounts. UK adults on average have used sixteen discount codes or vouchers each.

Clearly attitudes have changed in the last couple of years. There could be many reasons for this… the wider downturn in the economy has made us all a lot more savvy when it comes to saving and the proliferation of available loyalty or points schemes have also made it easier to make savings in a store we’re regularly visit.

Then there’s data. Discount vouchers or codes are a lot more personally tailored to our wants and needs then they were before.

It’s no longer about scouring a newspaper and clipping out a couple of coupons for items that are an approximation for something we sort of regularly buy. Now thanks to improvements in tracking and analysing our online behaviour, we have targeted emails or display ads with money-off the items we’ve actually browsed on a website.

We have barcoded cards that help supermarkets track the exact items we buy and send us vouchers for those specific products, which we would, frankly, be remiss not to use.

And for those who would be embarrassed to use a discount voucher in a high street, ecommerce has made flagrant bargain hunters of us all.

Multichannel behaviour

Online behaviour has begun invading the offline world.

28% of people say they’ll always compare prices online, even if they’re shopping in store.

We call this showrooming, and it can easily be used to a retailer’s advantage, especially if a store’s multichannel experience is seamlessly joined up. 

A consistent pricing strategy would help, as well as free home delivery for purchases made instore, click and collect and multichannel returns.

Practical advice for retailers

Use actual words and dates for your discount codes. 11% of people are more likely to use a discount code if the retailer makes it memorable rather than random letters and numbers.

Present the option to enter a voucher code as early in the checkout process as possible. 13% of people said they dislike checkout processes that only allow the voucher code to be applied at the very end.

However there is a danger here that shoppers will abandon the process and go off searching for a discount code on Google, when they were already practically committed to buy the item.

It’s a difficult balance to get right. As a customer with a discount code, it can be frustrating trying to find the place to enter it if it’s been concealed during checkout. However you also don’t want to needlessly lose profit from consumers already purchasing from you.

This can also lead to you a longer term problem of training your customers to only shop with you if they have a voucher code. People won’t want to pay full price on your site ever again if they’ve only experienced you with a discount.

For more advice check out How should online retailers handle discount codes? and click on the image below for a bigger version of Browser Media’s infographic…

Christopher Ratcliff

Published 8 December, 2014 by Christopher Ratcliff

Christopher Ratcliff is the editor of Methods Unsound. He was the Deputy Editor of Econsultancy. You can follow him on Twitter or connect via Google+ and LinkedIn

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Comments (3)

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Sabine Gamsjager, Marketing Manager at Shop2market

Hi Christopher,

I do agree that there a certain rules retailers should follow when it comes to voucher codes. I think the question retailers need to ask themselves is whether or not they would have also had this order without the voucher code. If not, than it resulted in a (new) order/customer, which is a positive result.

If the answer is yes, why should retailers pay double: the discount and commission for the coupon website?
I think retailers want to know the added value of such coupon sites to their online performance. Doing this by last cookie only will end up in a biased view, there're more touch points than that last coupon code. And then the question rises, which touch point had most value and should actually receive an incentive?

What it comes down to is that retailers should look into marketing attribution to base these decisions on and to maximize their profit in a proper way.

almost 3 years ago

Daniel Lee

Daniel Lee, Web Analytics Manager at Evans Cycles

I'm particularly interested in this too.

Due to the nature of the beast, conversion rates are much higher from this channel of traffic, but one has to ask how much sale cannibilisation is occurring.

Furthermore, if the traffic sent by voucher code sites was new to the destination sites, why are voucher code sites so opposed to working on any commission model different to last click?

From a conversion perspective, it's a great move to drive more of this traffic to site, as it has a high conversion % - but surely the more you send via this channel rather than other channels (PPC etc), the more it will impact revenue generated.

If voucher code sites were keen to prove their value, I'm surprised that they have not come forward to provide evidence that they don't cannibilise sales, are indeed adding value and that generating brand new customers.

almost 3 years ago

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Sabine Gamsjager, Marketing Manager at Shop2market

Hi Daniel,

I do agree with you. I think they can have added value, but in a different way. We do help retailers with this problem, searching alternative ways and making the whole concept transparent. I'd love to dive into that topic with you. Let's take this conversation offline?

almost 3 years ago

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