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The first coupon ever was distributed back in 1887 and not surprisingly, by the brand paragon Coca-Cola. With this piece of paper in hand, customers could redeem one free glass of Coke at local dispensaries. At that time, nobody could predict the impact it will have on the future of commerce. Over the years, however, millions of free drinks were redeemed and the famous brand has solidified its presence. Other companies have taken notice and implemented coupons into their marketing strategies.
The rest is history: nowadays, almost every brand and retailer use promotions and discounts to improve the bottom line.
Ways of delivering value
Strategic discounts and freebies foster a positive brand image, boost consumer satisfaction, and reach new people. They serve as mainstays of customer loyalty programs and customer acquisition efforts. Some people do not hesitate to pay the full price, while others, who are in majority, explicitly seek coupons and vouchers. They are so-called value-seeking customers sensitive to promotions.
Brands know this and provide these incentives to different segments of the audience. Take the example of discounts. Even when they are slight, tend to reduce cart abandonment rates and increase sales. Beyond that, it is estimated that nearly 80% of customers use coupons on a regular basis. Additionally, 91% of the states that they will visit the retailer again upon redeeming a coupon.
Note that recent years have also been marked by the proliferation of “free gift with paid purchase” and other tactics. Various promotional products are used to deliver rewards to loyal customers and nurture lifelong brand ambassadors. People adore the free stuff and perceive the benefits of as higher than paid discounted products (and not just because they are bad at fractions). Thus, brands that offer it can start the relationship on the right foot.
