🎓 Definition

Coupons are marketing tools used by Retailers and Suppliers to incentivize customers to make purchases. A coupon is a type of discount offered to customers for a specific category, product or service.

Customers can receive the coupon through various channels, such as email, direct mail, or in-store advertisements.

Coupons are typically redeemed at the point of sale, either by presenting a physical coupon or by entering a code at checkout. They often offer a fixed discount or fixed value on a specific category, product or service. Usually coupons have an expiration date, after which they cannot be redeemed and are mostly subject to redemption terms, for example:

  • Coupon only valid within a certain date range
  • One redemption per household
  • Basket Value must reach a certain amount,
  • Coupon cannot be redeemed in conjunction with another promotions.

🧪 Example of Coupon and Redeem

A Retailer wants to boost sales for a specific category or product and decides to offer a coupon promotion. They create a coupon offering a 10% discount on all purchases of that category or product to be used during a defined period of time. It can be a defined day, a period of time during the day.

Another example of a coupon is when Customer spend a certain amount of money during a specific period, they will receive a coupon with a value corresponding to X% of their purchase value to be used in their next purchase.

❓What is Coupon and Redeem used for

There are several benefits when using coupons as a marketing tool:

For Retailers:

  • Increased Sales: Coupons can incentivize customers to make purchases they might not have otherwise made, leading to an increase in sales for the store.
  • Customer Acquisition: Coupons can attract new customer to the store who may not have shopped there before. This can help to build customer loyalty.
  • Customer Retention: By offering coupons to existing customers, the Retailer can encourage repeat purchases and retain loyal customers and minimize the Churn Rate.
  • Increased Average Basket Value: Coupons can encourage Customers to purchase more than they originally intended, leading to an increase in the average basket value for the store.
  • Inventory Management: By offering coupons for specific products, the store can clear out slow-moving inventory and reduce Stock Aging
  • Data Collection: Coupons can be used to enroll New Customers and collect customer information, such as email addresses and purchasing habits, which can then be used for Targeted offers.
  • Improved Retailer Image: Coupons can improve the Retailer image of the store by portraying the business as customer-focused and willing to offer discounts to its customers.

For Manufacturers:

  • Increased Sales: Coupons can attract new customers and encourage repeat business, leading to an increase in sales.
  • Brand Awareness: By offering coupons, manufacturers can increase awareness of their brand and attract new customers who may not have tried their products before.
  • Customer Loyalty: Coupons can incentivize customers to remain loyal to the brand, reducing the chances of them switching to another brand, which can also be referred to as Switch Loss.
  • Market Research: Manufacturers can use coupon campaigns to gather data about their customer base, such as which products are most popular or which promotions are most effective.
Learn more about Coupon and Redeem
Churn Rate
Stock Aging
Targeted offers
Switch Loss