Incentivizing Customers without Coupons

and Discounts#AddShoppersLive

I. Intro

II. Strategies

III. Re-cap

IV. Live Q & A

Agenda

When does it make sense to coupon?

Liquidating inventory

To reach economies of scale (e.g. to achieve shipping discounts, supplier volume discounts, etc.)

To grow new customer acquisition (requires you to have an accurate metric for customer LTV)

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What happens when you discount excessively?

Margin Erosion

Tarnished Brand Perception

Selling discounts instead of value

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Coupons by the numbers:

This doesn’t take into account other costs like customer support, warehousing, affiliates, etc.

Current Revenue $1,000

Margin 30%

Current Net $300

Revenue w/ Coupon $1,500

Coupon Value 10%

Margin 20%

Net w/ Coupon $300

The Right Way

To Discount

Keep it special & targeted

Don’t give coupons away for free

Don’t show discount offers to everyone

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5 Strategies

Chad LedfordChief Revenue Officer + Co-Founder

1. Contests & Giveaways

Contests & Giveaways

Pros:

● Incentive is capped and limited to 1-3 winners

● No risk of coupon leakage

● E-mail opt in rates 43% higher

● No damage to margins & perceived value

Cons:

● Requires marketing collaboration

● Requires administration / customer support time

● Local rules and regulations need to be considered

Email Capture ContestField Supply increased email captures by 42.9%

Share To WinHope’s boosted email captures by 51% & social sharing by 905%

Selfie ContestScrubs & Beyond Increased Brand Engagement

Name That ItemHope’s captured 1,977% more emails

Win Your WishlistSilver Jeans boosted sharing by 4,650% & email captures by 224%

2. Shipping Upgrades

Shipping Upgrades

Pros:

● No discounting of actual products

● A proven conversion-booster

● Can be less costly than couponing, depending on your typical coupon amount.

Cons:

● Additional expense per order

● Can create conditioning to expect free shipping

Free ShippingAn E-tailing Group study revealed that unconditional free shipping is the #1

criteria for making a purchase. 73% of customers consider it critical to proceeding to checkout.

Expedited ShippingB&N Membership includes Free Express Shipping

Members Only ShippingFree Shipping for Staples rewards members

No MinimumL.L. Bean Free Shipping - no end date

No Return Shipping Fee81% of consumers are likely to abandon the cart if the return

policy is not lenient.

3. Free Promotional Items

Free Promotional Items

Pros:

● No discounting of your standard products

● Typically less expensive than offering a coupon

● Can lead to incremental purchases of the item given away

Cons:

● Requires additional work from your order fulfillment team

● Adds incremental cost per order

Free GiftsFree 14 piece gift for orders over $19.50

Free Samples with PurchaseGreat way to build awareness of new products

Free Gift CardGreat way to cross promote other products

Extended Warranty / InsuranceAdditional value for customers

4. VIP Status

VIP Status

Pros:

● Doesn’t incur any additional costs

● Helps identify & segment your best customers

Cons:

● Can be confusing to customers - requires education

● Difficult to keep customers engaged

● Difficult to make changes without customer kick-back

First Access to New Products

Exclusive Offers for MembersUber VIP - upgraded after 100 rides

Early Access to SalesPresale tickets for top customers

Customer Spotlight OpportunitiesMake customers feel famous

5. Loyalty Points

Loyalty Points

Pros:

● Drives repeat purchases & loyalty

● Loyalty program participants are most likely to become brand influencers

Cons:

● Difficult to change once loyalty program is established… *cough* Starbucks *cough* :)

● Requires integration & setup

● Can be difficult to sync across offline and online shopping

Socially Sharing ProductsOffer points for product shares

Leaving ReviewsGet 10 Birchbox Points for each sample review

Refer-a-Friend for Points50,000 points for you - 10,000 points for your friend!

Points for PurchasesEarn 10 points for every dollar you spend

Creating an AccountGet double points when you join within a certain time period

I. Contests & Giveaways

II. Shipping Upgrades

III. Free Promotional Items

IV. VIP Status

V. Loyalty Points

Strategy Recap

Additional Questions? Follow Up:

To learn more about AddShoppers, check out our trending resources: addshoppers.com/trending-resources

To register for a Live Demo check out our schedule:addshoppers.com/live-demo/

We help the world’s top brands market to their influencers.

chad@addshoppers.com@ChadLedford