Coupon or discount codes entered by your customers during the ecommerce ordering process can help your business monitor and measure the effectiveness of marketing and advertising and make better promotional decisions.
For a professional marketer, measuring a marketing campaign should be one of the first considerations in every new advertising or promotional plan. Without measurement, you won’t really know what worked, and you can’t justify a continued investment properly.
Without measurement, you can find your business in the classic John Wanamaker dilemma: âHalf the money I spend on advertising is wasted; the problem is, I don’t know which half.
One way to monitor (or at least compare) how your marketing promotions are working is to use coupon or discount codes. Buyers are familiar with coupons and entering coupon codes online. When you limit the distribution of a given coupon code to a specific promotion or marketing tactic, you can measure that tactic.
Example of a coupon campaign
Imagine owning an online pet supply store that sells everything from puppy leashes and shampoo to 40 pound bags of pet food and small packets of dog treats.
Your business is about to launch a dog treat sale and your marketing team has decided to place banner ads on several websites, including dog training blogs, breeder sites, and pet travel sites. of company.
For each site, your marketing team develops a specific promo code that is logically connected to the content of the banner ad. A banner ad with the headline “Because You Love To See Her Smile” may use the coupon code “MakeSmiles” on one website and “ForSmiles” on another.
In each case, when a buyer uses a promo code, you will be able to identify the website where your customer found the promo code.
Return on advertising spend
Your business could use this data (the number and dollar value of sales that each banner ad sent to your store) to determine the return on ad spend for each ad.
ROAS describes the ratio of dollars invested in a particular advertising tactic to the revenue or profit it has generated. ROAS can be expressed as a percentage or as a dollar amount, such as the number of dollars returned to your business for every dollar invested.
The ROAS of a group of banner ads like the ones in the dog treat example would tell your business how much money each ad made for your e-commerce business and measure the net success of the campaign. With this in mind, ROAS works best if your goal is to generate immediate profit.
Coupon codes can also be used to create relative comparisons or benchmarks when your goal is not necessarily immediate profit from individual sales.
A physical retailer in the Northwestern United States wanted to identify which print publication would work best for an upcoming campaign. For several months, this retailer ran coupon offers in every publication. Coupon codes were post specific and allowed the retailer’s marketing team to identify posts that appeared to have a relevant audience.
This retailer later ran a series of advertisements (aimed at building customer loyalty) in the print publications that generated the most responses. This relative metric didn’t necessarily mean that those posts produced the best ROAS, but the most engagement.
That same retailer will also use promo codes to test email messages. The retailer’s digital marketing group will develop two or three versions of the copy emails and headlines. Each email has a specific coupon code that can be measured whether or not the buyer clicks a link in the email.
In a recent campaign in November 2017, the retailer generated 486 sales valued at over $ 50,000 in three days. Pre-sale coupon code testing (across multiple media) helped optimize the campaign.
Coupon codes are a good way to measure many forms of ecommerce marketing. They allow you to tie a sale to a specific tactic, such as a banner ad, a Pandora ad, a TV ad, or even a print ad directly.
You will know for sure if a particular tactic resulted in one or more specific sales.
Again, this type of metric works best when your goal is to drive immediate sales, compare relative engagement across multiple ad vehicles, or conduct certain types of A / B marketing testing.
As you develop your business’s ecommerce marketing campaigns, create ways to measure them. Collect performance information that will help you optimize campaigns and make relatively better marketing choices.