October 12, 2018 Last updated October 10th, 2018 2,700 Reads share

How Coupons & Offers can Increase Revenue

Image Credit:

Giving things away for cheap or even free is rarely a sound investment option. This is the risk you run when you decide to run an offer without planning it first. Many small businesses fall into the trap of offering a great deal at a low price and end up running at a loss in the long run.

To help guide you through the pitfalls and the benefits of running a discount offer or coupon campaign, here are a few tips:

Have a plan

Before presenting an offer or discount to the public, you need to consider how you are going to recoup the loss. Let’s say you sell umbrellas at $100 each. To encourage sales during a dry spell, you cut the price by 40%. Now your umbrellas are selling for $60 instead of $100. Great deal!

But for every umbrella sold, you’re losing $40. Just to break even you’ll need to sell 40% more umbrellas at $60 than you did at $100.

You should also consider the impression you’re giving by discounting your offering. Are those $100 umbrellas going cheap because it’s clever marketing, or are they not actually worth $100? Are they instead only worth $60?

When you reduce the cost of your products or services, the perception of those products and services changes. Customers will devalue your offering and you run the risk of making it appear out of date or low quality.

Next, you need to figure out how you’re going to make money and how a coupon or offer is going to help facilitate that. You can figure this out by forecasting and studying past customer behaviour.

If you have no data, you’ll have to build the loss into your plan too. Sometimes your offer needs to be a loss-leader, but ideally, it should be getting you new business.

Real or digital coupons?

Technology has come a long way from cutting coupons out the back of the Sunday supplements. Digital coupons are empowering businesses with wider reach and better customer experiences.

Ecommerce businesses are the obvious beneficiaries of digital offers and coupons, but all kinds of small businesses can leverage them. In addition to ensuring sales, digital offers can encourage in-store footfall, such as Punch Taverns’ Free Pint  coupon campaign. These types of campaigns allow you to upsell and cross sell additional products.

Creating coupon campaigns

Coupons and discount campaigns are similar to other types of marketing campaign. The most important thing to do is to make it easy for customers to engage and take advantage of your offer. Don’t make customers jump through hoops.


  • Use concise text with easy-to-follow instructions
  • Make sure you have a compelling offer
  • Build a sense of urgency
  • Include a clear call to action
  • Add eye-catching imagery to bring excitement to your campaign

Ideas for coupon campaigns

Social media

Spread the word by integrating digital coupons into social media. When a customer makes a purchase on your site using the coupon code, you can invite them to share their experience with their friends. This naturally increases the reach of your promotion with no additional work on your part.

You can also advertise your offer across the multiple social media platforms your customers are using to make sure they don’t miss the chance to take advantage of your promotion.

Push notifications

Push notifications are one of the best ways to grab people’s attention via their phones and tablets. Many apps offer the opportunity for you to remind customers of your latest offers no matter where they are.

Using geo-targeting, you can have a push notification send a coupon code to customers that are close to your store. It’s clever stuff that can help boost footfall as well as make a sale.

Loyalty schemes

One of the interesting side effects of living in a world so connected is FOMO, or the Fear Of Missing Out. Small businesses can leverage this consumer habit by offering exclusive coupons and offers to loyal customers. According to a study by Razors Edge Business Intelligence, 90% of consumers are part of a loyalty scheme, while only 15% of retailers offer one.

In addition to rewarding your regular customers, you can promote your exclusives and encourage people to sign up to your mailing list or visit your store regularly in return for special deals.

Discounts to recover abandoned carts & deals to attract new customers

Ecommerce sites see customers abandon carts every day. You can use coupons and special discounts to lure back basket abandoners and give them the push they need to get a sale. A 10% discount can be given to the customers who have abandoned their carts.

You can experiment with creating campaigns that focus on attracting new business. For example, if a customer arrives at your online store and tries to buy a product, you can offer a 5% discount.

Don’t forget to set an expiry date

Expiry dates on coupon offers are very important. Part of having a campaign plan is deciding on a specific start and end date for your promotion. This gives you more control over the costs and allows you to build focused advertising around the promotion.

This also means you won’t get caught out by having to give away something cheaper two years after you thought your promotion ended.

Attribute your coupons

Whether it’s a digital coupon or a paper coupon, it’s important to attribute your coupon sales. This allows you to see how many sales your promotion managed to achieve. This is essential for measuring success and helping you recoup the loss of discounting your products and services.

Measure, test & learn

Attributing your coupon sales, having an established time frame and having a plan gives you all the tools you need to measure the success of your campaigns. For digital coupon campaigns, you can measure your campaigns using Google Analytics. But first, you need to figure out your ROI.

How to measure Coupon Campaign ROI

  • Figure out the cost of the coupon campaign. This includes distribution costs and any additional marketing outlays.
  • Calculate your margins. You do this by subtracting the overall cost of the product from what you charge for it. So, if you’re paying $20 for every umbrella and after the coupon, the price to the customers is $60 per umbrella. Your umbrella margin is $40.
  • Next, calculate how many products you need to sell to cover the costs of your campaign. This gives you your breakeven point — the baseline for your campaign success.
  • Finally, see how many products you sold and how that compares to your breakeven point.

When your coupon campaign is complete, take the time to review your successes and failures. This gives you insights into how to make your next campaign even more successful than the first. If your first attempt doesn’t get you the results you expect, don’t lose heart!

Do some research into how your competition are succeeding and get feedback from your customers. Then, match it up with the data you gathered from your original campaign and test, refine and try again. You’ll only get better with practice, data and refinement.

Andrew Margison

Andrew Margison

Read Full Bio