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How Coupons Can Kill Your Sales, And What You Can Do About It

Author: Lee Silverstein   |   November 30th, 2011

Ever seen an ad for an air fare special for one price? But by the time you sign up and get to the small print, you realize that your fare isn’t nearly as cheap.

How often does this leave a bad taste in your mouth?I opened my mail the other day and found some coupons sent to me by a well known department store.

“20% Off Your Next Purchase” screamed one coupon; “$20 Off Your Next Purchase” shouted the other.

“Hmmm, I do need some shoes” I thought. The hole that was burning in my pocket was quickly doused when I turned the coupon over, put on my reading glasses, dusted off my electron microscope and read the fine print.

1, 2, 3, 4, 5, 6, …………………….74, 75, 76 77. Seventy seven exclusions were listed on the back of this “coupon”! Yes, I did say 77. Besides the sheer number of things I can’t buy with this coupon there’s a host of unintended consequences that these coupons cause.

Anyone who has ever worked in a customer service business knows that customers rarely read the “fine- print”. Imagine a customer enjoying a day of shopping. He or she has walked around the store, perhaps gone to the fitting room to try some things on. They stand in line at the register and when it’s their turn to pay, the associate tells them they’re sorry, but you can’t use your coupon on this, this, this and this. Now your idea for gaining loyal customers has done nothing, but ticked them off.

To be effective, loyalty programs need to be simple to understand for your customers and employees.

I recently received the following email from Starbucks :

“We want to thank you for being such a great Starbucks customer. We’re so happy you’ve chosen us and are pleased that we can offer you some amazing benefits. Here’s what you’ll get:

• A personalized gold card.

• A free drink with every 15 stars you earn.

• We’ll add flavored syrup to your drink, or customize with soy milk, for free.

• Free refills on brewed coffee and tea every time you visit.

• A free handcrafted beverage on your birthday.”

Looking for the fine print? There isn’t any. This email is what a good loyalty program looks like. It’s easy to understand, makes me feel like I’m an important customer (they call me a “great customer”) and doesn’t leave me thinking “what’s the catch”?

The department store’s way of “thanking” their customers, however, creates more frustration than loyalty. And who do you think is on the receiving end of the customer’s frustration? The sales associate. Picture the poor sales associate who has to continually tell their customers “I’m sorry, you can’t use your coupon on that item”.

What has this great idea for a loyalty program gotten you? Aggravated customers, and employees who are tired of bearing the brunt of your bad idea. As for me; I bought my new pair of shoes……………….somewhere else.

About Lee Silverstein
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3 Responses to “How Coupons Can Kill Your Sales, And What You Can Do About It”

  1. Tom Borg Says:

    Lee,
    You make a great point and illustration. Too many businesses try to sneak one over on their unsuspecting customers. The rest of their customers just roll their eyes at these kind of offers. It is obvious that the first example does more harm than good.

  2. Tom Borg Says:

    Lee
    Just so happens I received a “$10” off coupon from JC Penny today. It sounded good until I read the fine print. After reading it I soon discovered it was a meaningless coupon.

  3. Shefiu Francis Says:

    I certainly agree with you from a customer’s viewpoint. Unfortunately, most people don’t read the small print on their coupons. The captivating thing is the big print they see initially. I had one offer myself with my card company recently offering a 15% off Coupon for my next purchase. But not knowing the deal was only for 14 days and it expired. As a result, I missed out for not reading the small print.

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