Pros and cons of coupons
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Pros and Cons of Using Coupons in Your Business

Pros and Cons of Using Shopping Coupons

In today’s e-commerce world, the trend of Shopping Coupons is at peak. In such case, coupons are like a magnet that will attract customers to your business. If reports are to be believed, 96% of consumers have used a coupon in the past 90 days. Coupons are a fantastic tool for advertising and marketing for your organization.

Though couponing makes the brand more appealing, it can be a tough decision for small-time businesses. There is a continuous flow of discounted purchase which can hamper the profits of the business. However, studies have shown businesses offering coupons have a competitive edge. Customers are driven by the need to purchase by a strong influence of coupon availability.



Now whilst offering the coupon on their websites, companies first need to decide on a strategy. Consider your business model, your promotional campaigns, etc before taking the plunge.

Here are few pros and cons of using coupons in your business.

Pros of Using Coupons

  1. One of the benefits of offering coupon is you get an opportunity to introduce your store to new customers, your product line.
  2. It is also a way of cleaning the unwanted inventory and making room for a newer product in your warehouse. You could make space by giving away old, untrendy products at lower prices and get new and trendy products.
  3. Through coupons, companies can encourage customers to try out their brand or get their first-time buyers back to their store.
  4. On introducing a new product line or a new brand company can speed up the sale by offering coupons and discounts. It is a great way to gain the much-needed attention. Also, you can put up old products for discounts and introduce a new line of product side-by-side.
  5. Due to frequent visits and purchases from loyal customers, companies incur a quick inflow of cash. That’s the reason why some companies offer discounts and coupons so frequently.
  6. Coupons can also be used to create your customer base. For instance, at the time of buying the coupon encourage your customers to enter their name and email address. This way you can form your base for email marketing and use this names and emails while selling a new product or starting a new campaign.
  7. If the company tends to sell coupons on social media, it is another good way to make customer base and allow free communication.
  8. When you offer coupons, discounts, and deals it creates a buzz among your customer and drives traffic to your site. In this way, customers may even end up buying non-discounted products due to the strong influence of the site.
  9. The usage of mobile is on the verge as compared to desktops and laptops. Most of the emails today are viewed from mobile applications. Discount Coupons continue to be received from mobile. Hence, there are fair chances of customers viewing and buying the coupon.
  10. With the advent of digital technology, the cost of creating and distributing coupons has dramatically reduced. They can be easily compiled through online sources and share them is even most easier. They can be shared through online couponing sites, email or social media networks like Facebook and Twitter.
  11. Offering coupons and deals may also encourage your customers to switch brand.
  12. It has been studied that, so many times the customer never redeem the coupon. Do not worry you’re not in for a loss. This may also serve as an awareness for your company/product for free.

Hence, the bottom line is very clear. Coupons will drive business to your store. Just get in the right discount market strategy.

Cons of Using Coupons

  1. The biggest con of offering coupons is that it will cost you money. The discount you offer will obviously affect the weight of your pocket. You need to calculate whether the discount you offer will make any difference to your profit margin.
  2. You need to have a careful strategy on how and when to introduce coupons again. Some regular customers wait for coupons habitually. But this cannibalizes your income generated in your previous coupon program, thus making a deficiency of existing cash.
  3. Coupons always result in reduced profits on the item. Do your math before starting a coupon campaign. You need to assess the cost of purchase for the product and the value of coupon on that particular product.
  4. Many companies maintain their brand image by maintaining competitive prices, keeping low margins of profit so that they don’t feel the need to introduce discount programs. Due to fear of lost revenue since the customer might make their purchase without a coupon as well.
  5. When a company offers a discount, consumers subconsciously lower the brand value in their mind. They came to a conclusion that the merchandise must be overpriced if the retailer is able to make discounted offers.
  6. Nowadays, customer expecting shopping coupons from retailers are at a high. According to estimates, about 85% of consumers seek coupons before visiting a retailer. If you are not offering coupons, you may lose out on that population and even get perceived negatively for not offering special offers.
  7. If you’re giving out coupons to first-time buyers only, regular customers may feel left out. Chances are that you might hurt the sentiments while trying to woo new customers. Carry out an equal balance between new and old customers by satisfying their needs.
  8. There are chances that your employees may limit the quality of their services. They might feel that they’re tipped less based on the decreased amount of the bill.
  9. Coupons are not a long time promotional strategy. There are few customers who buy products with discounts only. There is a fair chance of customer buying the product from you when you’re offering coupon and not coming back once the discount period is over.

Lastly, have a crystal-clear idea of the amount of discount you’re going to give. The decision to lose potential profits in exchange for sales is sole of the business owner’s. Shopping Coupons can be an effective marketing strategy if done in right manner.



Article written by Tarundeep Singh

I am a Web developer and Social Media Promoter at Tarundeepsingh.com I have done BCA. I am working on my Coupons and Deals Program.