9 thoughts on coupon activity operation

Coupons are an important and practical marketing tool for operators.

We can usually find that in various fields of the Internet, whether it is e-commerce, food delivery, taxi, travel and other platforms, coupons are essential tools for attracting new customers, promoting activation and conversion.

Coupons are called differently on different platforms. Some are called red envelopes , some are called vouchers , and some are called coupons , but their essence is the same.

Why use coupons?

Coupons are essentially a "price discrimination" strategy, in which merchants differentiate prices based on different consumer demands. They neither infringe on consumers' equal rights nor violate the principle of fair trade. Instead, they are reasonable pricing behaviors for merchants to pursue profit maximization.

For example:

Suppose a hamburger costs 5 yuan and is priced at 10 yuan, 100 people will accept this price.

When the price is set at 15 yuan, 60 people will accept this price. The profit of the former is (10-5)×100=500 yuan, and the profit of the latter is (15-5)×60=600 yuan.

But the merchant did not want to give up the other 40 consumers with a lower willingness to pay, so he decided to use a 5 yuan coupon to attract them, while maintaining the original price of 15 yuan for the remaining 60 consumers who were not sensitive to prices. At this time, the merchant's profit is 60×15＋40×10－5×100=800 yuan, which is maximized.

For users, coupons are a psychological issue. What users need is not necessarily to get a bargain, but the feeling of getting a bargain.

If the product price is reduced directly, sales will indeed increase in a short period of time. But after a long time, when users become familiar with the price, this stimulating effect will no longer work. When you raise the price back to the original price, sales will actually decrease.

The use of coupons takes advantage of a contrast effect, which makes users feel that they are getting a good deal. It creates an urge for users to take advantage of a good deal, which leads them to buy more from never buying.

Framework of this article:

1. Types of coupons

The types of coupons vary depending on the gameplay and purpose of the activity . Generally, there are the following types:

1. Full discount coupons: can be used when a certain amount is reached; full discount coupons can increase the average order value or promote conversion, mainly targeting old users who have consumption habits on the platform, so as to increase the overall profit of the platform by selling more products at a lower profit margin;

2. Designated product coupons: can be used for specific products; provide targeted guidance for products you want to promote;

3. Specified area/nature/category coupons : can be used for products within the area/nature/category, for example, in the tourism industry, only outbound products can be used, only surrounding activities can be used, etc.;

4. Specified days coupon: only used for products within XX days; guide users to place orders for long-term products;

5. Unrestricted vouchers: There are no restrictions on the amount, product, or region. Unrestricted vouchers are generally used to convert new users or recall silent users, or to conduct flash sales unrestricted voucher activities to attract user attention and increase platform traffic.

2. The amount of the coupon

The amount of the coupon will be affected by the type of coupon and the marketing goal you want to achieve. The specific amount depends on the affordable cost of the activity and the user's perception of the coupon . It is necessary to understand how much coupon amount should be given to the user to encourage the user to place an order.

For example, for food delivery platforms like Meituan and Ele.me, a red envelope with no threshold of 10 yuan is enough to attract users to participate in the event. However, for e-commerce platforms like NetEase Kaola, where product prices are all over 100 yuan, a red envelope with no threshold of 10 yuan will hardly attract the attention of users.

3. Validity period of coupon

The validity period of a coupon can be set based on operational purposes or activity purposes. It is fairer to users if the coupon is valid for N days after receipt.

If you want to increase the platform order volume during a certain period of time or on a certain day, you can consider valid from X/X/X to Y/Y/Y, or valid on X/X/X.

4. Number of grants

According to the intensity of subsidies and the purpose of the game, it is divided into: unlimited issuance, limited issuance, and limited issuance and release in batches, and even the issuance can be restored after expiration.

The significance of releasing it in batches is that it can promote activity and conversion over multiple days rather than concentrating it on one day or a period of time.

5. Applicable users

Depends on the purpose of the activity.

For example: for new or first-time users, promote new conversion and retention; for VIP users, promote VIP purchases and continuous purchases; and the other is common to all users.

6. Frequency of collection

You can only collect it once a day, and you can collect it again after using it up. These methods are flexible and need to be determined based on the subsidy situation and the goals to be achieved. Each approach means different subsidy inputs and effect outputs.

7. How to distribute coupons

(1) Reward coupons after placing an order:

After the user places an order and pays, a coupon will be returned to the user, with the goal of enabling the user to place an order again. The face value of the coupon can be set based on the subsidy affordability and the average customer spending threshold, and the validity period of the coupon needs to be set based on the user's travel frequency.

(2) Random distribution:

This is a way to avoid subsidizing high spending.

Users can be informed of the random range of coupons to stimulate them to collect them, and the actual denomination after collection is determined randomly. However, this random distribution method is very unreasonable. The effect it actually produces is far worse than if the system had an algorithm that determined the quota based on the individual. For example: the score for new users is higher; the score for active old users is lower. This will make the effect more clear.

(3) Activity scene distribution:

You can receive the coupons directly on the event page, share the event to receive the coupons, complete designated tasks to receive the coupons, obtain the coupons through lucky draw, redeem the coupons through points, or receive the coupons through cross-industry cooperation.

(4) Distribution to specific groups:

For new or lost users, larger coupons can be issued separately to promote the conversion of new users and the recall of lost users.

8. Use of coupons

After the coupons are distributed to the user's account, the initiative is in the hands of the user.

From the time the user obtains the coupon to the time the coupon expires, what the operator needs to do is to remind the user not to forget to use it.

The reminder time can be when the user just receives the coupon, in the middle of the coupon validity period, before the coupon expires...

9. Coupon statistics analysis

From the conversion of the number of views of the coupon redemption page to the number of coupons received , we can analyze whether there are problems with the coupon redemption page, and also show whether the coupon is attractive to users;

The conversion from the amount received to the amount used shows the attractiveness of the coupon and whether the operational reminders are effective; the actual usage represents the final conversion and measures whether the coupon setting is successful.

Related reading:

1. Event operation: coupon distribution strategy design!

2. How to use coupon activities to improve user conversion rate?

Author: Xiyan

Source: Xiyan