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Coupons are great, except when they're not...

By Adam Judd | April 22, 2013

Coupons are a great way to encourage new customers to visit your storeCoupon promotions are a great way to bring customers into your store and encourage them to complete the transaction where they may otherwise not be completely sold on their purchase. From looking at data across all FoxyCart stores, we’ve noted that stores that provide coupon discounts have as much as 83% more transactions, bringing in 60% more revenue than stores without. While that’s not a hard-and-fast rule, if you put some time into creating a coupon and marketing it, we believe it will definitely be worth your time.

Too good to be true

Recently, gaming hardware manufacturer Razer found itself in a bit of a tight spot. They regularly run coupon promotions to attract new customers and reward existing ones, but a coupon found its way into the public that was never meant to. It seems that a third-party company that was testing Razer’s discounting system accidently left a test coupon in the system that the team wasn’t aware of. The coupon, activated simply by the generic code “1234” gave the customer an unbelievable 90% off of their order. All it took was for one serendipitous individual to try a few common codes, post their discovery online and the social networks took care of the rest with thousands of orders placed in the space of a few hours.

Razer was quick to respond to the issue, and after pulling their site offline for a short time to investigate, posted to Facebook with their decision to honor the orders.

“While we have the option of cancelling the orders legally, we’ve always had a customer comes first policy at Razer and in respect of this incident, we have decided to honor the orders that were placed using the unauthorized code by Razer fans buying single products for their own use.”

Co-founder and CEO Min-Liang Tan on Facebook

The decision was an unexpected bold move by the company as an effort to increase goodwill with the customers - and it worked. Comments on posts about the event are littered with expressions of support for the company that will no doubt turn into future sales, and reports of customers cancelling their majorly discounted orders and reordering at full price.

Prevention is simple.

While testing is definitely something we encourage you to do a lot of - often it can be something that you complete and move on without cleaning up your work. That definitely looks to be the case with Razer, and is a scenario that could very well happen to anyone. If you haven’t already jumped over to your FoxyCart administration to look through your active coupons - we absolutely recommend it. It would also be worthwhile reviewing your add to cart links and forms across your site - ensuring that any testing or out of date add to carts aren’t still active anywhere. We’ve had reports in the past where a customer has made a purchase for a product at a price that the merchant didn’t think should be possible - but a hidden away add to cart in a dusty corner of their website had an old price for the product that enabled them to purchase it. While Razer turned their sticky situation into a positive one in terms of customer goodwill (albeit they may still be making a considerable loss on the persisting orders), we suggest periodically reviewing your site’s enabled features and functionality to ensure it is not a situation you find yourself in unexpectedly.

To finish off though - while this is certainly an example of something to be aware of when working with coupons - don’t take it as a reason not to use them at all. The return on investment that we see with stores who are using coupons as a promotion tool shows a noticeable growth in sales. Coupons can be a very flexible tool as well; whether you include a banner on your website, an email campaign to subscribers or hand out coupon cards to prospective customers at a trade show - the possibilities are endless. And when coupled with FoxyCart’s flexible discounting system, you can achieve some very inviting offers for your customers and some fantastic results to your bottom line. Why not give them a try!

Are you someone who has been, or are using coupons in your store? We’d love to hear from you in the comments below on how you used them and your experiences with working with them as a tool.

The views expressed in the above post are the author's own, and may not reflect those of FoxyCart.com LLC.

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