Never judge a voucher code by its cover: why discounts shouldn't always be seen as a last resort
Last week an article appeared on eConsultancy that raised a few eyebrows. Or more specifically, mine. In a nutshell the piece argues that discounts should always be seen as a last resort. The implication was that they don’t drive brand awareness, loyalty or sales. In my opinion this assertion overlooks two key factors.
Discounts should not be discounted
Firstly, the piece argues that voucher sites are often the last click in the customer-purchasing journey. So what? There is plenty of data to support the theory that if you reward people they will spend more with you. Many discounts convert customers to engage with a brand, which they previously wouldn’t have. Often they are pleasantly surprised and become loyal customers with a high life time value.
What Ian McCaig’s article doesn’t take into consideration is that many affiliate partners are last click in the purchase cycle as this is how they are paid and they are experts in closing a sale. However, so are many brand terms and other advertising partners, I’m not sure why being last click should been seen as a negative, as an advertiser I need those channels to be closing the sale. In reality voucher sites are only a small part of the marketing mix so I don’t think this is an area for concern.
Furthermore, sites such as Groupon and Vouchercodes.co.uk are hardly small fish. They are viewed by millions every single day. You can knock them all you want, but for brands all around the world they work. Voucher sites and other affiliate sites also play a wider role in the purchase journey beyond last click. In addition they get a brand in the consumers mind and assist in the research stages of the customer journey, which is particularly important when you have a number of competitors.
Secondly, to dismiss voucher codes so easily is somewhat blinkered and doesn’t take into account the bigger picture. Vouchers can be used beyond simply driving sales, they can be used to drive higher value purchases, sales of a particular product or to retain existing customers. I strongly believe that you need to understand activity beyond the last click. When I worked at Sky we dedicated time and effort to understanding the entire consumer-purchasing journey in order to best adapt our strategy, drive more traffic and convert sales. We found that not only do voucher codes help to ‘seal the deal’ they also featured higher up the funnel, driving traffic to the website in the crucial early stages of decision-making. Only when you truly understand the bigger picture can you make an informed decision regarding your digital marketing strategy and understand the value to your business of offering discounts and via what channels.
Discounts might be easy to sniff at, but the fact is that they can also be an effective tool to drive more sales in a busy period, keep sales healthy when things aren’t so busy, take your brand to a new audience or drive higher purchase values.
Clearly no one is saying that you should use voucher codes all the time, but surely that is common sense marketing. The reality is that discounts can be used both strategically and tactically in order to drive growth, depending on your business objectives. Their versatility makes them very useful and effective. And, in my opinion, that makes rejecting them outright simply because they are the last click a mistake.
Helen Southgate is UK managing director at affilinet