Although there are signs that coupons are on the wane, the truth is not doom and gloom. Coupons are still popular today, but things have changed. The changes are mainly on the business side.
According to CouponBirds’ data, a popular coupon website, the retailers are offering fewer coupon codes. This site collects coupon codes from more than 60,000 shopping sites. In March 2022, the average coupon offered per retailer was nearly 13. In June, however, the number of coupon codes per site dropped to less than 11, and in July, each merchant offered only about 10 coupons to customers. That may be because inflation has forced businesses to increase profits by cutting coupons.
The categories that reduce coupons are mainly food, grocery stores, and restaurants, which account for 20% of the coupon reduction category. Food-related businesses are facing the biggest burden as food prices rise to record levels due to unprecedented inflation. Retailers selling shoes, clothes or other accessories were the second to cut coupons. As prices rise, so do raw materials and transportation costs, forcing clothing retailers to adjust their coupon strategies.
It’s clear that it is a short-term trend, as the macro economic situation is forcing businesses to adjust their plans. But the fact that coupons are good for both businesses and consumers is undeniable.
Coupons cater to consumers’ psychological need to save money. This is based on the fact that humans have animal instinct and can’t be rational like they imagined. When consumers want to buy a product, they should consider not only brand, quality and price, but also how to save money. Therefore, consumers will compare the prices offered by different stores in the mall, and they will generally buy goods at the store with the discount if other factors are unchanged.
88% of consumers used coupons in 2020, and more than 142 million American adults used digital coupons, according to SpendMeNot’s survey. And online coupon users spend 24% more than regular shoppers. This shows that consumers are inclined to use coupons, and many of them are willing to use them. As a result, they are spending more money than before. Finally consumers spend more money, but they can buy the products they want at a lower price, which is the desired result of consumers and merchants.
Using coupons can bring happiness. It’s not our unfounded claim, it’s science: A study from Claremont University found that accepting and using coupons can reduce stress and increase a person’s oxytocin levels – which can make a person feel happy – by 38% (which is a larger increase than kissing).
Coupons are an attractive method to change shopping decisions. Coupons can play an important role in promoting new products. One survey showed that 80% of consumers are willing to switch brands because of coupons or other discounts. Coupons push people to learn about and try new products. When you’re facing with two coffee shops, your favorite coffee shop has no coupons, and the new coffee shop offers great coupons to new customers. That makes coffee cheaper at new cafes It’s not a bad thing for most people to try a new brand at a lower price.
For merchants, using people’s psychology laws helps to improve sales, profitability and loyalty. Often items labeled “sale” may not be the cheapest, and the price of a sale item in one store may be the normal price in another. But people will always pay for bargains, and coupons work just as well. Merchants can use coupons to guide consumers’ purchasing behavior, such as using coupons to sell outdated products to make way for new ones.
Coupons can also be used to lure consumers to buy new products, which can promote people to know about and accept new products, so as to achieve the purpose of publicity and profit. Product evolution is the key to a company’s strategy. To get people to accept a new product, merchants need to provide very attractive terms, not only high quality and new functions, but also a very good price. But merchants don’t want to keep prices too low and squeeze profits, so they can use coupons to create the illusion of a price reduction, which can not only to attract buyers but also to keep prices.
Fast growing companies and new brands can use coupons to introduce customers into the store. When the season is off, merchants can offer small coupons to stimulate consumption desire. Because of the off season, people’s demand is not big. How to set the amount of coupons is a problem worth thinking about. Even if the amount of coupons is large, it will not make the already low demand consumers spend much more. So, the off-season coupons can not be too many and the discount can not be too big. But with new brands,using large coupons can increase customer traffic which is important for them. Customer acquisition is the first step in a new business.
Also, coupons can create loyalty with existing customers by using the discount as a reward to ensure they continue to buy from your store. Therefore, coupons can be considered into the long-term sales strategy of businesses and adjusted as the market changes.
If coupons are not used properly, it may reduce the company’s profits. The high inflation rate in 2022 is a huge challenge for business. That has forced some companies to give away fewer coupons. In the long run, however, the benefits of coupons make it hard for both consumers and businesses to abandon them. A decrease in the number of coupons in the short term does not mean that coupons will actually disappear.
