Latest news:

You are currently not logged in

Log in

Why coupon codes are harming your business

Killing you softly: Why coupon codes are harming your businessBalbin

If your running an eCommerce store or considering opening one, using and disseminating coupon codes can be a fantastic tool to drive sales, increase average order value or to reengage dormant customers.

Being in the drivers seat – you decide the discount and control all the variables along the way. In addition, your Content Management Systems (CMS) should be able to report associated transactions and revenue for any coupon code you created.


Life is good – your online store is advancing.

(And here comes the but..)

But, coupons are actually doing your business an injustice. While coupons are a great tactical marketing tool they are slowly eating away at your margin. Every day, every minute, every second, even when your sleeping.

Some of the most advanced eCommerce CMS’ and Shopping Carts in the world are making the same mistake everyday.

The big mistake – the coupon code field

According to a recent Monetate report, Checkout Abandonments Rates worldwide average at 82%. In plain english that means only 1/5 people who add something to their cart actually end up finishing with a purchase.

In the bricks and mortar world this is akin to 4 customers walking up to the counter, wallets ready, card in hand only to walk away. Heads would roll.

Why? Why do 4/5 people abandon their carts? In my experience of the many reasons is that iddy biddy coupon field. Here’s what I mean:


The red arrow in the image above indicates a field that as a shopper your always happy to see. It means that there is a possibility that you can complete your purchase at a cheaper price, with a coupon code.

So off to Google you go and search for a coupon. (Note BigW only ranks 5th for this search query)



You hop over to OzBargain (self confessed addict here) and get distracted by all the amazing savings.

Now put on your business owner hat. Lets assume that you use coupons as a short term tactical solution. More often than not, your not using coupons so why tempt people to leave when they are about to hand over their money? Why place a coupon code field during the checkout?

Back to our bricks and mortar analogy, it’s as if BigW would place a huge billboard on top of the counter and tell you that the same product is cheaper if you just take 20 minutes to fill up your car at the nearest Shell to receive a 15% off docket.

Admit it, you’ve coupon trolled before. And your not alone. As shoppers we’re getting smarter and we drive hard for a bargain.

Solution: Hide the coupon field when you have no live coupons. Simple.

Userlicious recently tested this with a client and found that by hiding the coupon field, there was a 5% bump in sales.

5% may not sound significant, but for an hour or two’s work, its well worth the while.


Tzvi Balbin is an experienced digital marketer previously heading up online marketing at CatchOfTheDay, one of Australia’s fastest growing online retailers (raising $80m in 2012), improving their conversion rates by over 25%. He now runs his own eCommerce and Optimisation consultancy, Userlicious and shares his wisdom with eCommerce stores the world over. You can find him via @tybalbin, on Google+ and on Linkedin.

No Comments | Be the first to comment

Comment Manually

No comments