Everybody loves a great deal. According to Social Media Today, the number one reason that people follow brands on social media is to learn about and gain access to exclusive discounts and promotions.
In fact, 56% of respondents in a 2016 survey said they connect with brands to receive regular coupons and promotions. Consumers want to know about offers, sweepstakes, discounts and coupons, and there are dozens of reasons why you should consider sharing them.
Why Promotions Matter
Promotions and discounts influence purchasing decisions. They give your customers incentive to buy more and keep coming back for future purchases. They can help attract new customers and build brand loyalty. Still not convinced you need well-crafted promotions? Here are a few key statistics you should know:
● Over 80% of shoppers say they utilize more than one promotional channel to make purchases. (Market Track)
● Coupons are the most sought after type of promotions from consumers, based on a survey by Placed and RetailMeNot.
● In 2016, 92% of consumers used a coupon to make a purchase. (PRRI)
● Of that percent, 87% of Millennials, 91% of Generation Xers and 96% of Baby Boomers used coupons for purchases in 2016. (PRRI)
● Almost half (49%) of consumers will switch brands to take advantage of a promotion or coupon. That number jumps to 60% for mobile coupon users. (GfK MRI The Survey of the American Consumer)
● 83% of consumers have made an unplanned purchase based on a promotion they received.
● 60% of consumers love to receive digital coupons or codes and 50% are likely to visit in-store if they receive one
Even though consumers are attracted to deals, what is considered a “deal” often varies.
Types of Promotions
Deals can come in many different forms. Some of the most common that businesses offer are:
● BOGO (buy one, get one free)
● Free shipping with purchase over a certain amount
● Free gift with purchase
● Percent discount on purchase
● Loyalty program or member discounts
● Free samples with purchase
● Bundled value sets
The type of promotion(s) that you use depends on a number of factors, but you should primarily consider your goal and target audiences.
Selecting the Right Promotions for Your Business
For businesses, it can be a challenge to figure out which promotions generate the most interest and provide value to customers. If you aren’t promoting the right offers, then you could be dumping funds and resources into efforts that yield little to no results.
However, the latest research and surveys can give us some insight into which promotions today’s consumers are drawn to most often. For example, every age group is receptive to promotions, but how they find and use them differs.
● Millennials use coupons just as much or more than their parents.
● According to a Bloomberg report, 90% of Millennials use some form of coupons.
● Millennials search for coupons in: groceries (93%), beauty and cosmetics (69%), clothing (62%), household (60%), and restaurants (57%)
● Millennials are also the age group leading the use of digital and mobile promotions. Based on estimates from eMarketer, there are 121.3 million digital coupon users in the US.
Digital and mobile promotions are becoming more popular among all age groups. That doesn’t mean people aren’t willing to cut out some coupons if the discount is worthwhile, but keep in mind extensions like Honey, social promotions and sites like RetailMeNot.
How to Market Your Promotions
Once you decide which promotions you want to run, you also have to figure out the best way to get the word out. Should you offer print coupons, online or mobile? Should you send them with direct mail or email? A Facebook ad or website banner? Perhaps you want to do a combination of different channels? When deciding, keep these tips in mind:
1. Email is the preferred method to learn about promotions.
One of the most effective ways to reach consumers and share promotions is email. Research from PwC reports that 58% of global consumers prefer to receive discounts and promotions through email, 20% through print sources, and 10% through text message.
Another US-based survey found that email is still overwhelmingly the most preferred method to learn about promotions (60%), but direct mail isn’t far behind (54%). Including promotions in email newsletters is a cost-effective way to engage with your customers and boost sales.
You can use a mix of channels to share your promotions, but keep your audience in mind. For instance, text messaging is still in its infancy and may not be the best way to reach out to US consumers. However, mobile promotions are thriving, especially amongst Millennials.
2. Free shipping is a must for online retailers.
When it comes to online promotions, free shipping is a huge influence. Based on a RetailMeNot holiday survey, the top three reasons consumers are likely to spend more money with a retailer is when they offer free shipping (31%), a percent off the total purchase (28%), or a specific product deal (17%).
In a recent study by UPS and comScore, 77% of shoppers said, "free shipping remains the most important option during checkout". Over 60% of shoppers even said they would place additional items in their cart just to qualify for free shipping. Another 2016 survey found that percent can climb to 91% around the holidays.
3. Consider a loyalty program.
One-time promotions can spike your engagement and sales, but if you want to keep that momentum, then you should have a plan in place. One option is to develop a loyalty program for customers. This helps you build more long-term customer connections and sustain the benefits of promotions over time. Loyalty programs aren’t for all business, but there are clear advantages to consider:
● In a global PwC 2016 retail survey, 91% of participants said that they are a member of a loyalty or rewards program.
● 70% of respondents said the top benefit for joining loyalty/reward programs was member-only discounts and offers.
● A CFI Group survey found that the biggest influence for signing up for loyalty programs, according to 93% of consumers, was access to special promotions.
When loyalty programs offer tangible and clear perks, customers are not only willing to sign up, but have a more positive perception of the brand.
Promotions are a highly effective way to engage customers, generate interest and increased sales, but use them strategically. Offering too many promotions can dilute the value of your offers and brand. When it comes to loyalty programs, one of the main incentives is that it gives a layer of exclusivity.
It is important to preserve your brand’s value and integrity by limiting the number of promotions, coupons and other offers customers can use at a given time. Placing your promotions strategically throughout the year will generate more response than if you offer them all the time. It is important to know which deals are the best for your business, goals, and audience. Successful promotions can take a lot of time and planning, but if managed well, they can produce impressive returns. For professional advice on crafting engaging promotions, marketing them and connecting with your audiences in more meaningful ways, reach out to 10twelve today.