Coupons Still a Solid Small Business Sales Strategy

Coupons are the most common sales promotional tool used by businesses. Their usage continues to grow annually as they provide a way to save money for the consumer while the retailer uses them as a way to grow and retain sales.  The coupon has been consistently proven to be an effective tool in business.

 Coupon Use by the Numbers

They are a cost efficient way to generate sales because literally everyone in the buying market uses them at some time.  Here are a few statistics that prove the usage of coupons in the marketplace from 2016 year to date analysis.

1)      Over half of consumers use a coupon at least one of every four purchases (RetailMe Not).

2)      45.1% of Millennials use coupons (CCG Catalyst).

3)       Valassis reports

a.       88% of affluent shoppers use coupons from the mail

b.      81% find print coupons before shopping

c.       77% search for deals in store circulars.

4)      Print and online are the most frequently use mediums to search for incentives

5)      85% of consumers look for coupons (non-grocery) prior to visiting a retailer (Retail MeNot).

 Who Uses Coupons

There are myths as who uses a coupon to shop.  Typically, women are the biggest users of coupons at 82% while men are at 56%.  The difference is related to the idea that women do most of the shopping but as times continue to change, I believe men will use coupons more and more. Interesting as heavy coupon users (5+ coupons used weekly) women and men are very close with a four percentage point spread.  Roughly 70% of all households use coupons and of the heavy user households it is about 30%. In age brackets, adults 18-24, 66% have used coupons (a group many retailers feel do not use coupons at all). With coupon usage continuing to climb as the age group ages to 61+ at 80% usage. Missouri households tend to use coupons at 81% while heavy users are 16%, so the practice is very active here in our state. (Information for these statistics is from the Manufacturers Coupon Control Center).

How to Get Your Coupons Out There

As a retailer, you have many options to choose from for coupon delivery.  Some, like the FSI, are used mainly by national companies. For our local businesses, the options are direct mail, ROP newspaper, local magazines, handouts and electronic. Each has its own advantages and disadvantages and to get the best results the retailer needs to evaluate them against his/her marketing objectives for the coupon.

How to Attract with Coupons

Another question is how much should the coupon be for? According to NCH Promotional Services, consumers require a coupon value of 23 cents before they would consider using one. For a product they have not tried before, a value of 44 cents was required. The survey pointed out that by increasing the value did not necessarily mean a higher redemption rate. 

So as a local small business, the idea of couponing should be considered as part of your promotional marketing mix.  It can deliver an audience ready to buy.  If there are questions about this article or would like to set up a time to discuss your business marketing strategies, feel free to contact Richard Proffer, University of Missouri Extension Business Development Specialist at 573-243-3581 or profferrd@missouri.edu.